Metro Council Delays Decision On Sewer Rate Hike
A Louisville Metro Council committee has delayed a decision on an ordinance that would raise sewer rates by 20 percent, or about $10.49 each month for the average ratepayer.
The measure wasn’t brought to a vote during a budget committee meeting Monday afternoon, but an additional piece of legislation filed earlier in the day gave council members the option of essentially approving a smaller rate increase.
The Metropolitan Sewer District board requires Metro Council approval for any rate increases larger than 6.9 percent; the new proposal would give the board the ability to raise rates up to 10 percent annually for the next four years without legislative approval.
At the committee meeting, MSD Executive Director Tony Parrott made his case for the 20 percent rate increase, saying it’s necessary to update crumbling sewer and flood protection systems.
“Decades ago the system was adequate, but as our city has grown and as the assets have gotten older, we have been strained in terms of keeping the system in working order,” he said. “We have tried in recent years to stretch our dollars, to make sure we can keep them operational. We’ve been using sort of a Band-Aid approach, if you will, to do that, and to be able to make sure we could keep a level of service.”
The agency has laid out a 20-year plan to fix the problems in a $4.3 billion Critical Repair and Reinvestment Plan. That plan calls for a large initial rate increase, followed by smaller subsequent increases.
These investments are different from the federal consent decree to reduce sewer overflows into the Ohio River. MSD has spent more than $400 million so far on those projects and is projected to spend another $500 million by 2024.
Parrott’s testimony drew scorn from Councilwoman Mary Woolridge, who said she couldn’t believe any of her colleagues would support such a move.
“‘The sky is falling, the sky is falling! We’re going to be another [Hurricane] Katrina, we must have a 20 percent increase,’” Woolridge said, parodying Parrott. “I disagree with him. I think it is absolutely outrageous for us to even entertain a motion for a 20 percent rate increase.”
Last year, in proposing an identical rate increase, MSD encountered similar opposition. The effort failed in 2016; this year, MSD officials have spent months making their case for the rate increase, holding more than 40 meetings with various community groups and industry representatives. Parrott said by and large, he found community members understand the challenges the district is facing, and support the decision to begin working to fix them.
But, perhaps in a nod to the uphill battle of getting council approval for the 20 percent rate hike, an alternative plan was proposed earlier Monday. That ordinance would change the section of Louisville’s code that restricts the MSD board from raising sewer rates more than 6.9 percent annually. Instead, it would allow rate increases of up to 10 percent without Metro Council approval for the next four years.
As Metro Council members were preparing to meet to discuss the subject, Republican state Rep. Kevin Bratcher announced he was considering filing legislation to move MSD under control of the Kentucky Public Service Commission.
Any discussion about a sewer rate increase was tabled until July 13.