We had a great meet and greet on Wednesday, May 21, 2014. A good number of residents attended.
There were questions about the technical aspects of the water and wastewater systems and Lee Wolfe explained. He also explained that due to the actual flow levels experienced by the system and some other engineering realities he did not expect there would be a continued requirement for a second Eliminite tank in the sewer system but that other improvements to the sewer system would be reviewed by the Department of Environmental Quality (DEQ) based on the data of the system and available technologies.
Lee explained that Glacier Point Water & Sewer is not a homeowners association and attendee-residents discussed the desirability of them creating a homeowners association. It appeared that many homeowners looked on this option favorably. Lee explained that it would be nice to deal with a homeowners association when communicating matters relating to the system to the homeowners.
Lee explained what parts of the water and sewer system are owned by the utility and which are owned by the homeowner. Glacier Point W&S owns and is responsible for the water system up to and including the curb stops. The homeowners are responsible for their water system up and to where it attaches to this curb stop. Glacier Point W&S owns and is responsible for the sewer system up to and including the sewer mains. The residents own and are responsible for the residential side of the sewer system (including septic tanks) to the point it connects to the sewer main.
There were questions about whether there would be a rate increase for water and sewer usage. Leroy Beeby, a rate analyst with the Montana Public Service Commission (PSC), explained that there would be no immediate increase but that Glacier Point expects to ask the PSC to gradually increase rates (over a two to three year period) to the $80 water-wastewater rate referred to as the “Standard Rate Tariff” pursuant to PSC rules for simplified rate setting for small utility systems. This rule allows a small utility system to forego an ordinary rate case and its costs, which can run $20,000 to $30,000 in legal and other fees on top of the expenses a utility expects to recover with a particular rate. This small-system rate setting rule is a boon to small systems like Glacier Point because an ordinary rate case is very expensive and those costs must be passed on to the users of the system. Mr. Beeby noted the new small utility rate setting procedures protects both the water utility customer and the utility itself and is a great solution for the problem of small systems who need to recover the costs of installing and operating a system, but are unable to take on the expense of an ordinary rate case.
Pursuant to this rule, a small system may simply charge $50 dollars per hookup for water usage and $30 dollars per hookup for sewer usage, a rate considered to be fair and common for small utility systems in Montana. Obviously, if the Standard Rate Tariff would be too low to cover expenses, a system could initiate a full-blown rate case. Glacier Point W&S does not expect that to occur. See the rule here. See a PDF version of the rule here. In order to alleviate “rate-shock” (a increase in rates that occurs all at once), the PSC would permit a phase-in of the rate over a two to three year period. Glacier Point W&S understand that the $80 combined rate would be effective for three years with additional three year periods available if requested of and approved by the PSC.
In the future, after at least three years, if the Standard Rate Tariff seems inappropriate given the needs of the system, another simplified rate setting procedure created by the new rule may be undertaken. This procedure evaluates the actual operating expenses of the system and will set rates according to those expenses. (This potential new future rate setting methodology is called the Operating Ratio Methodology and is set forth in new PSC Rule 38.5.2529.)
We also discussed the new water system web site which will have information on the system and allow for paperless, online payment of bill.