ROGERSVILLE — On Tuesday, the Board of Mayor and Aldermen approved two of three required readings for a 23 percent water/sewer rate hike ordinance, which is expected to be implemented in September.
The increase will cover a $2 million bond being issued to upgrade the system as well as offset the current budget deficit.
With the assistance of a $50,000 loan from the city’s general fund, the Rogersville Water Department ended the 2018-19 fiscal year $13,324 in the red.
The minimum water/sewer rate inside the city will increase from $18.19 to $22.04 for the first 1,000 gallons.
The minimum water rate (without sewer) for nonresidents will increase from $21.83 to $22.70 for the first 1,000 gallons. Nonresidents on the city sewer system will see their bill increase from $29.63 to $35.57 for the first 1,000 gallons.
A public hearing, as well as the third and final reading of the water hike ordinance, will be on the Aug. 14 BMA agenda.
A detailed breakdown of the new water rate schedule can be seen in the online version of this article at www/timesnews.net.
A recap of the 2017-18 Water Department budget
For the 2017-18 fiscal year, the Rogersville Water Department ended $13,324 in the red, including the $50,000 that was injected into the budget by the city.
Acting Water Superintendent Bill Pearson presented the Water Commission with a detailed breakdown of the 2017-18 budget during Tuesday’s meeting, which preceded the BMA meeting.
Water Department Revenues
Budgeted water revenue was $2.344 million, but actual revenue was $57,517 below budget.
Sewer revenue was budgeted at $606,456 and came in $35,000 below budget.
Overall, revenue came in $90,000 below projections.
Water Department expenditures
On the expense side of the budget, the water treatment plant was budgeted at $501,250, but spent $75,061 over budget.
The wastewater treatment plant was budgeted at $411,114, and spent $60,000 over.
Maintenance was budgeted at $696,750, but came in $41,000 under budget.
Office and administration expense was budgeted at $1.326 million, and came in $102,334 under budget.
The total budgeted spending versus actual expense was $8,500 in the hole.
That’s not including capital outlay, debt payment and depreciation.
Other aspects of the budget
Capital outlay projects were budgeted at $144,500, but only $81,870 was spent.
Debt principal was estimated at $359,891, but was $17,945 over budget.
For total cash outlay, the department was in the red $53,207, which takes into account depreciation.
Total revenue for the year was $2,863,974, while cash outlay was $2,882,004, for a negative balance of $18,030.
Did alleged theft affect the 2018-19 budget?
Commissioner Mark DeWitte asked how much of the $90,000 revenue deficit could be attributed to alleged theft by previous Water Superintendent Shawn Hatchett. Pearson said he couldn’t answer that, although the 2017-18 fiscal year began July 1, 2017, and Hatchett was suspended that same month after $69,000 in Water Department receipts was reported missing.
According to a Tennessee Comptroller’s report, Hatchett diverted cash collections totaling at least $338,929 by withholding funds from deposits he was entrusted to deliver to the bank.
The investigation is continuing and more charges against Hatchett are pending.
Searching for Hatchett’s replacement
Pearson, who has served as interim water superintendent since Hatchett was fired last August, said he interviewed one candidate with managerial experience, but he believes the search should continue. Pearson said several applicants had work experience, but no managerial experience.