For decades, Williamsville village residents have paid a much higher water bill than all their neighbors. And for decades, village leaders have debated the worth of shutting down the village’s Water Department and getting the Erie County Water Authority to take over the old and leaky system.
That debate is finally over.
This week, Mayor Brian Kulpa received Village Board approval to sign an agreement with the Water Authority for a complete takeover of its water system. The takeover, which will take a year, is expected to mark the end of routine water rate hikes and budget subsidies required to keep the water system running.
“The village is done chasing leaks underground,” Kulpa said. “We’re focusing our effort on creating value above ground for our residents.”
The village just recently raised the water rate from $4.87 per 1,000 gallons used to $5.37. That’s a sharp contrast to what the average Water Authority customer pays – $2.96 per 1,000 gallons. The latest village rate increase followed rate hikes in 2009 and 2010 before more aggressive steps were taken to control water leaks.
“It’s time to get out of the water business,” Kulpa declared earlier this year. “It’s a game that we can’t play and win.”
Under the new agreement, signed by the mayor just this week, village residents will still pay more for water than other Water Authority customers – at least for a period of time – but most will pay a rate lower than the current one.
“I have to give an enormous amount of credit to Mayor Kulpa,” said Water Authority Commissioner Jack O’Donnell. “He and his trustees have been relentless in pursuing this. The long-term benefit to them of not having the responsibility and maintenance and upkeep of this system, I think, is going to make the village residents very happy.”
It also will benefit other Water Authority customers, since expanding the customer base keeps water rates down across the board, O’Donnell said. The agreement is expected to be approved by the Water Authority board next Thursday.
The new agreement will require village residents to pay a special surcharge on top of the Water Authority’s standard $2.96 water rate to replace all of the village’s outdated water meters and to upgrade the village’s broken water lines.
That surcharge could be in place for up to 20 years, Kulpa said, until roughly $2.7 million in debt is paid off.
Even with the surcharge, however, the agreement would ensure that village residents will pay no more than $4.87 per 1,000 gallons, the amount they had been paying until the most recent rate hike.
The agreement will not lower water bills for everyone, however. Single residents who use very little water would see a jump in their bill because the minimum water billing charge for the Water Authority is 9,000 gallons, while the village has a minimum water billing charge of 4,000 gallons.
Finally, the village still has to wrestle with some deficit accounting that could result in future tax increases.
For many years, the village had subsidized and “artificially suppressed” its water rate by spending money from its general fund. That money – $418,000 – is considered by the state to be debt that must be repaid to the village.
The village began to address this by raising its water rate to $5.37. But once the village water system is transferred to Water Authority control by June 2014, village leaders will have to find other ways to pay off the remaining debt.
The village expects to save money once it no longer has to support a separate Water Department, Kulpa said, but some tax increase may also be necessary. Even so, he said, the benefits to the village in getting out of the water business far exceed the costs.
“What we have to do here is look at the best interests of the village, the best interest of our water users, and the best interests of the village in the future,” the mayor said. “There’s going to be a lot more people helped in this scenario, and there will be a tremendous amount of savings for the future, for future generations.”