Hollister
– City officials unveiled a plan Thursday that calls for using
rate increases and future impact fees to fund the construction of a
new $120 million sewage treatment plant, completion of which will
prompt the state to finally remove the sewer moratorium that has
been strangling the city for nearly
four years.
Hollister – City officials unveiled a plan Thursday that calls for using rate increases and future impact fees to fund the construction of a new $120 million sewage treatment plant, completion of which will prompt the state to finally remove the sewer moratorium that has been strangling the city for nearly four years.
The sewer project will be paid for with money generated from selling bonds, according to Councilman Doug Emerson. Since the moratorium – imposed by the state after 15 million gallons of treated sewage spilled into the San Benito River in 2002 – has halted new construction, the city won’t be able to use impact fees from new construction to cover the bond. Therefore, the city council will have to approve a new sewage rate scheme to demonstrate that it can generate enough revenue to satisfy the binding company.
“We have to authorize the rates to cover the cost of the $120 million project in order to be bonded,” Emerson said.
Under the new rate schedule a single family residential water bill, currently 31.30 per month, will cost $124.40 per month by 2009. The sewer rate increases, once approved, will be as follows:
2006-07: 48 percent
2007-08: 40 percent
2008-09: 39 percent
2009-10: 38 percent
City officials, however, hope that the full rate increase won’t have to be implemented. It is anticipated that impact fees from new development once the moratorium is lifted will cover nearly half the cost of the treatment plant’s construction. If that assumption holds up, the sewer rate increase for current customers will be significantly less. The monthly rate would climb to $71.50 by 2009.
Under that scenario, the rate increases would be as follows:
2006-07: 48 percent
2007-08: 40 percent
2008-09: 5 percent
2009-10: 5 percent
City officials have said that the new treatment plant will be complete in mid-2008 or early 2009.
