This table sets forth the one-time monthly bill increase needed for each utility as compared to the five phases being proposed for both the minimum monthly charge and the charge based on average consumption/flow/meter size.

From the City of North Vernon

The City of North Vernon Municipal Water, Sewer and Stormwater Utilities, through the Utilities Services Board, have performed Rate and Financing Sufficiency Analyses to determine whether their current rates and charges generate sufficient revenues to fund the necessary operations and maintenance costs, pay debt service on the outstanding long term bond issues, provide the required debt service coverage on these outstanding debts and to provide sufficient funds for the Utility’s ongoing capital replacement needs. The current revenue generating Utility Rates were effective on the following dates:

  • Stormwater July 1, 2008 (Final Phase of a four Phase Initial Rate implementation);
  • Water July 1, 2020 (Final Phase of a three Phase Rate implementation); and
  • Sewer January 1, 2020 (Final Phase of three Phase Rate implementation).

The City of North Vernon Waste Disposal and Recycling Fund initially began charging residential customers for waste disposal services in 2005 and increased that rate in 2013/2014. This Fund, through its Street Superintendent and City Common Council, has determined that the current monthly waste disposal charge does not generate sufficient revenues to pay the landfill/transfer fees, capital equipment necessary for waste disposal and recycling activities, salaries and wages of those responsible for trash pick-up and the operation of the City’s waste disposal and recycling facilities.

The recent minimal annual increase amounts for both the Water and Sewer Phased-In Rate implementations were intended to help mitigate the magnitude of future increases as no formal capital plans had been performed. Currently the Stormwater and Sewer Utilities have had detailed Long Term Capital Improvement Plans prepared by their Utility Engineer.

While the Water Utility does not have a formal Long Term Capital Plan, it did have its Water Utility Engineer prepare a short-term project listing for the purpose of applying for the Indiana State Revolving Funds’(SRF) State Water Infrastructure (SWIF) Grants (funding from State Funds received from the American Recovery Plan Act).

The Water, Sewer and Stormwater Utilities did submit their individual grant requests to the SRF by the July 15, 2021, SWIF Grant deadline. However, no North Vernon Utility received grant awards from this first round due in part to the fact that each of the utilities’ current monthly rates are less than the monthly rate floor set by the SRF. In addition to the SWIF Grant, the Stormwater Utility also had applied for grant funds from the Indiana Office of Community and Rural Affairs (OCRA).

The time and financial resources invested in this attempt again did not result in funding assistance. While the projects included in both grant applications are capital projects that would benefit the City’s Residents, the fact that the current rates charged are below the rate thresholds, North Vernon cannot qualify for the funding assistance that the grants would provide. Therefore, the City and its Utilities must fund the needed capital improvements through increases to the rates they charge customers/citizens.

Each of the Analyses performed resulted in the need for substantial rate increases. For all Utilities, the increases were due to the magnitude of the capital improvements needed. It should also be noted that the unprecedented recent increase in the consumer price index (CPI) also contributed to the increases because of the impact on operations and maintenance costs. Given the impact to customers’ monthly utility bills due to implementing these substantial increases in their entirety, the Utility Services Board asked that the analyses be structured such that the increases be phased in over time.

Note: An annual CPI was used in calculating the revenue requirements for each of the Annual Phased Increases as well as the Single Increase scenario for the Water/Sewer/Stormwater Utilities. The Waste Disposal increase is a one-time increase and thus is applicable to the Single Increase column and the PH I increase column.

Both the City Council and the Utilities Services Board have always tried their best to keep the rates charged at the lowest possible level. However current factors and circumstances such as the increases in critical operational costs (i.e., chemicals, landfill/transfer fees) and ever-changing Federal and State requirements have made it impossible to do so at this time.

By using the phased-in approach rather than the single increase approach for all but the Waste Disposal increase does spread the overall impact of the needed increases over time and is intended to somewhat alleviate the burden that this may cause our citizens/users.