Wednesday, January 20, 2010

Drop in growth rate poses problem for city

Bellevue mulls ways to pay for new sewer facility


By TONY EVANS
Express Staff Writer

The real estate bust is hitting the city of Bellevue just as the city needs money to pay for a new wastewater treatment facility, scheduled to come online in February.

City Administrator Tom Blanchard says the city has stored enough cash in recent years from hookup fees from new residents to make the payments, but the city's wastewater fund balance could be nearly tapped out by 2013.

Blanchard said the wastewater fund balance was expected to be $150,000 in 2013, but current growth expectations will leave it with only $75,000.

The new treatment facility was funded with a $6 million sewer bond passed in 2005. An additional $714,000 in city funds was also allocated for the facility.

Residents currently pay $61 per month per sewer hookup. That rate is scheduled to rise by 4 percent per year for the next 20 years, in part to pay for the new facility.

Blanchard said that when the city made plans to build the new facility, growth rates had been about 4 percent. He expected that growth to continue, adding about 40 new homes to the city each year. Each new hookup would bring $3,500 to the city's sewer fund and $2,500 to the water fund.

Blanchard said he now expects a zero growth rate for the next few years, and said the population of Bellevue may even be diminishing. He said he doesn't expect growth in the city to hit 3 percent for a decade.

"We can't control how many people build in Bellevue, and that is going to impact our projections," he said.

Fortunately, the city raised about $470,000 in sewer capitalization fees over the last 10 years from new homeowners buying into the city's wastewater system. By law, that money can only be spent on sewer upgrades.

Blanchard advised the City Council last week to spend from the sewer capitalization fund first as the city begins paying for the new system. Otherwise, he said, the city may have to raise rates again to make up for the 2013 shortfall.

Tony Evans: tevans@mtexpress.com




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