Council considers decrease in water bills

The part of Biloxi’s water bill that has raised eyebrows and temperatures over the past several months — the payments to the Harrison County Utility Authority — will go down about $60 a year or nearly 14 percent for the average customer under a proposal being considered by the Biloxi City Council.

David Staehling, the city’s director of administration, presented a report to Council members that showed the city could afford to reduce payments to the countywide utility authority by nearly 60 cents per thousand gallons and still cover costs and debt service payments. The debt service payments, which help pay off the costs of improvements to the two wastewater treatment plants in Biloxi, caused monthly water bills to increase dramatically in Biloxi over the past year because the payments were based on a variable interest rate and were tied to water usage.

“We’re able to reduce these rates because we’ve seen more usage, we’ve reduced operation costs, and because the utility authority has negotiated a stable rate – 5.22 percent – on its debt,” Staehling told council members. “The variable rate had been averaging 6½ percent, which was costing an additional $3 million a year.

“Even though Biloxi has low rates for water and sewer, we know that the increase in that surcharge hit people hard, particularly with the increased usage because of the drought,” Staehling said. “The council will now be able to provide some relief.”

Staehling made the presentation to the City Council this morning as the first public step in the FY 2012 budget process. A new municipal budget will be place in mid-September for the new fiscal year, which begins Oct. 1.

Councilmembers also viewed proposals that could have seen property taxes increase slightly to provide even further decreases in water bills, and a proposal that would have seen water rates remain the same, which would have created an $855,000 surplus that could have been used to help fund the purchase and installation of electronic water meters.

In the end, councilmembers favored reducing rates, although no vote will be taken until more of the municipal budget is crafted.

Under the proposal that could take effect in October, the city would reduce the current surcharge from $4.40 a thousand gallons to $3.80 a thousand gallons. The average customer uses about 8,000 gallons of water each month.

How Biloxi stands: To see a comparison of current rates for water, sewer and garbage for South Mississippi communities, click here.