Oak Ridge officials are considering utility rate increases that could cost many residents another $6.87 per month, and they have also proposed building three large sewer system holding tanks, including two near busy roadways, in response to a federal order requiring the city to stop all sewer system overflows by September 2015.
Council could consider those proposals, as well as a request to buy three new fire trucks, during its Sept. 9 meeting.
Oak Ridge officials said the increases in water, wastewater, and electricity rates will pass on a 1.5 percent increase from power generator Tennessee Valley Authority, help cover work to comply with the sewer system order, pay for water plant and distribution system improvements, enable the implementation of new technologies that could help customers save money, and resolve cash flow issues. The rate changes could go into effect in January and be followed by additional increases in later years.
The sewer system holding tanks could be built at the East Plant Pump Station on Cairo Road, on Emory Valley Road in central Oak Ridge, and at Scarboro Road and South Illinois Avenue at the main southern entrance to the city.
The three new fire engines would replace trucks that are 15 years old. Those vehicles would be used as reserves. The new trucks could be delivered in September 2014 and cost about $482,000 each. The city would pay cash for one and lease-purchase the other two.
Utility rate increases
Oak Ridge Public Works Director Gary Cinder said the water and wastewater increases would help pay for electrical, wiring, and pump and motor upgrades at the city’s water plant. Some of the pumps are 50-60 years old, he said.
The city’s water distribution system, which includes many components more than 70 years old, also needs ongoing maintenance, including to fire hydrants and water tanks.
“It continues to need a lot of attention to keep functioning,” Cinder said.
The city’s sewer system also requires more work than what it is required in the U.S. Environmental Protection Agency order that requires Oak Ridge to repair its sewer system overflows, Cinder said. The non-EPA work includes lift station upgrades. Cinder said the city needs to pay cash for the ongoing maintenance and upgrades, rather than having to borrow more money.
The rate increases could total 15 percent in 2014 for wastewater and 10 percent for water, and then drop to 10 percent and 8 percent in 2015. They could taper off to increases between 6 percent and 4 percent from 2016 to 2019. The rate hikes would help build cash flow for more routine items, Cinder said.
“You’ve got to invest in the infrastructure to keep it working,” he said.
Information presented by consultant Chris Mitchell during a Monday night Oak Ridge City Council work session said the rate increases could cost the average resident who uses 2,000 gallons or less an extra $2.78 per month for sewer and another $1.35 for water. Cinder said about one-half of the city’s residential customers use 2,000 gallons or less per month.
The electrical rate increase includes the 1.5 percent TVA increase and a 1.2 percent distributor increase, a total 2.7 percent hike. The average residential customer could pay another $2.78 per month.
Oak Ridge Electric Director Jack Suggs said his department is trying to replenish its cash supply. Residential electrical consumption is down 9.5 percent in the past two years due to weather, and that’s where a majority of the Electric Department’s operating cash comes from, Suggs said.
“We’ve got to have cash to pay the bills,” he said. “We do not want to ever get in a position of paying our bills with debt.”
The Oak Ridge Electric Department is also trying to start a utility modernization program that would include a modern utility billing system flexible enough to meet TVA requirements, substation controls to control electrical loads and save money, and automated meters that would allow the city to participate in a TVA program introduced last week, keeping Oak Ridge competitive economically.
The rate increases to be considered by Council next month follow water and sewer rate increases approved by the Oak Ridge City Council in April 2012. Those hikes were implemented in two phases, the first in May 2012 and the second this past January.
The city staff said then that the increases were necessary to maintain adequate cash reserves and also pay for maintenance and capital improvement projects, including those required by the EPA order. Those increases were expected to be between 28 percent to 35 percent, depending upon a variety of factors, including the total number of gallons used. There was a minimum monthly increase of $7 for the first 2,000 gallons of water and sewer, but the increases were expected to be larger for bigger customers, the staff said then.
See Mitchell’s summary of the utility rate increases here.
Sewer system holding tanks
The three new sewer system holding tanks discussed this past Monday are also meant to help Oak Ridge comply with the EPA order. The tanks could store between one and two million gallons of a mix of storm water and sewer. Cinder has said the holding tanks are required at critical locations to detain extra water flows during heavy rains to comply with the EPA order.
“It should be noted that while technically the material is considered sewage, it is predominantly storm water that has leaked into the sewer system and exceeding its capacity to carry it to the treatment plant,” Cinder said in a recent memo.
The tanks could be emptied within a few days after a heavy rain as capacity in the downstream sewers becomes available.
Building the tanks and their associated pump stations could cost about $6.5 million, Cinder said. The U.S. Department of Energy could reimburse some of those expenses, and Cinder said the cost of the tanks is included in a recently announced $14 million state loan. Repaying that loan is part of the proposed rate increase, he said.
One two-million-gallon holding tank would be built on the east side of the former Daniel Arthur Rehabilitation Center on Emory Valley Center at Fairbanks Road. The Anderson County Commission has endorsed donating up to 2.05 acres of county-owned land at the site for the tank.
The East Plant tank would also be also be two million gallons, but it would be in an industrial area away from homes and busy roadways.
Council members raised questions about the visibility of the other two tanks, both of which could be close to busy roads. Those two tanks on Emory Valley Road and Scarboro Road at South Illinois Avenue, near the entrance to the Y-12 National Security Complex, could be more than 100 feet wide and 18 to 27 feet high. Council members asked if the tanks could be moved back from the roads, located elsewhere, or possibly partially buried.
“It’s going to be an eyesore,” City Council member Charlie Hensley said of the Emory Valley Road tank. “To put something like that on a main road is not looking forward…aesthetically.”
On Thursday, Cinder said the city is preparing a response for Council members that will discuss some of the suggested sites that had been discussed earlier by staff but essentially dismissed. Cinder said moving the Emory Valley Road tank farther back could put it on wet land and shift it off a solid rock foundation, a move that could cost significantly more. Burying the tank would be difficult and more expensive because of all the underground rock. Other sites could also require bigger pumps and extra sewer lines, which might have to be placed underneath the four-lane Emory Valley Road, city officials said.
Cinder said the city staff and its consultant were trying to minimize costs and use city-owned property when possible. But they could consider buying Mullins Car Wash at Scarboro Road and South Illinois Avenue and moving the proposed one-million-gallon tank there back farther from the road, making it less visible but not affecting its operations. Still, there is already a significant drop-off from the Scarboro Road/Illinois Avenue intersection to the proposed tank location, Cinder said, and that drop-off could help hide the tank.
Oak Ridge City Manager Mark Watson said other techniques, such as berms, paintings, and landscaping, could also be used to reduce the perceived height of the tanks.
City officials hope to have a final design authorization by Sept. 9 and submit the project to the Tennessee Department of Environment and Conservation by Jan. 10. The staff could tentatively award a contract in April 2014, and construction could start in late July and be complete by Sept. 1, 2015.
“The key here is the time schedule,” Cinder said.
Council member Chuck Hope asked Cinder and consultant Lamar Dunn to provide more information on the alternative locations and proposals, including costs, at the Sept. 9 City Council meeting.
The new trucks discussed during Monday night’s work session have a range of features designed to help firefighters battle smaller fires, such as in brush and cars, and make their jobs safer by, among other things, reducing their need to climb on top of fire trucks to accomplish certain tasks like winding up hoses.
Oak Ridge Fire Department Chief Darryl Kerley said the city hasn’t replaced a fire truck in 15 years. Money for the new trucks was part of Kerley’s budget presentation to the Oak Ridge City Council earlier this year.