New Utility Rates
Effective January 2021 Billing Cycle
Delta Township is proud to provide reliable water and sewer services to its residents and business owners. Water and wastewater services are funded through the revenue collected from your water and sewer bill. No tax revenue is used to provide water and wastewater service so the Township must align water and sewer rates with the cost to deliver services. Costs include (1) the cost to supply water and treat wastewater, (2) compliance with regulations governing the distribution of drinking water and treatment of wastewater, (3) the repair, replacement, and update of the Townships aging wastewater treatment plant, and (4) ongoing maintenance of critical infrastructure. Like any asset, regular maintenance is critical to maintain and operate water and sewer infrastructure.
It is a best practice to periodically conduct a rate study to ensure that rates are fair, equitable, and tied to the demand customers place on the water and wastewater systems. In 2020, Delta Township contracted with the independent consulting firm Baker Tilly Municipal Advisors, LLC, to prepare the Delta Township Water and Sewer Fund - Rate Study. The results of this rate study for both the water and wastewater systems are outlined below.
In the upcoming years, the Township is planning to invest nearly $78 million in maintenance and upgrades to the wastewater treatment plant. The rate study determined that the Township requires additional revenue to support the future debt service payments on these major capital improvements to the Delta Township Wastewater Treatment Plant.
A ready-to-serve charge for wastewater has been implemented at $2.50 per typical residential meter per month. Additionally, a 7.25% increase in the wastewater charge per cubic foot of water used has also been implemented. A typical residential customer with a 5/8” meter, using 1,000 cubic feet of water, would see their estimated bill increase from $34.38 to $39.40 per month in 2021 (Approximately $4.99/month).
On the water-side, the ready-to-serve charge (formerly called the “customer charge”) for the typical homeowner has been lowered from $12.40 to $10.00. Additionally, a 1.25% increase in water rates has been implemented. The average residential water bill based on 1,000 cubic feet is expected to decrease from $36.70 to $34.60 despite the 1.25% rate increase due to the reduction in ready-to-serve ($-2.40/month). Please note, 1,000 cubic feet is simply an estimate.
The net impact of the changes in the ready-to-serve charge and utility rates for water and sewer customers will vary based upon actual water consumption and meter size. Despite these increases, Delta Township water and wastewater rates remain competitive in the greater Lansing region.
For assistance in determining the impact of the rate increase on your bill, please call the Delta Township Accounting Department at 517-323-8510. Customers can review the accepted Rate Studies below.
WATER RATE STUDY
SEWER RATE STUDY
What Utility Charges Are Affected?
- A 1.25% rate increase will be applied to water commodity charges.
- The ready-to-serve charge for the typical homeowner has been reduced from $12.40 to $10.00.
- A 7.25% rate increase will be applied to wastewater commodity charges.
- The addition of a ready-to-serve charge for wastewater at $2.50.
When Was the Utility Rate Increased?
The utility rate increase was approved by the Board of Trustees at the December 21, 2020 public meeting.
When Will the New Rates Take Effect?
The new rates will go into effect for the January 2021 utility billing.
How Much Can I Expect My Bill to Increase?
A typical residential customer with a 5/8” meter, using 1,000 cubic feet of water, would see their estimated bill increase from $34.38 to $39.40 per month in 2021 (Approximately $4.99/month). Sewer-only residential customers would see no increase. The average residential water bill based on 1,000 cubic feet is expected to decrease from $36.70 to $34.60 despite the 1.25% rate increase due to the reduction in ready-to-serve ($-2.40/month). Please note, 1,000 cubic feet is simply an estimate. Despite these increases, we will remain competitive in the region while increasing revenues for critical infrastructure needs.
Why Were the Sewer Charges Increased?
The comprehensive Delta Township Water and Sewer Fund - Rate Study provided by Baker Tilly Municipal Advisors, LLC revealed that a rate increase is required to ensure adequate revenue is available to support future debt service payments on the estimated nearly $78,000,000 in projects planned to be done in multiple phases over the next several years to improve the wastewater treatment plant.
Why is This Major Capital Improvement Project Necessary?
Delta Township’s WWTP was constructed in 1965, with expansions in 1972 and 1986, which means the newest equipment is 34 years old. The equipment is at the end of its useful life; it is worn out and the plant is experiencing frequent equipment failures.
While the plant has historically met or surpassed required treatment levels, in 2019 the Michigan Department of Environment, Great Lakes and Energy (EGLE) added tougher treatment standards to our discharge permit in an effort to improve water quality in the Grand River. This requires a new treatment process that the existing plant does not have.
With approximately 10,300 residential, commercial and industrial customers including the State Secondary Complex and General Motors, the plant currently treats almost 5 million gallons of raw sewage per day which is over 80% of its design capacity.
What Are the Proposed Improvements?
Major Capital Improvements to the Delta Township Wastewater Treatment Plant are required to address issues with failing equipment, provide a higher level of treatment, and provide a modest increase in capacity for continued growth in the Township.
After identifying the large cost, construction difficulty, and inefficient operation of the plant, associated with repairing and retrofitting the plant, Delta Township’s project team developed a plan to reconstruct the plant on the same site. Reconstruction was found to be more cost-effective to both build and operate and is anticipated to use 34% less energy than repairing and retrofitting the plant.
The project will be constructed in phases. The first phase is planned for construction in 2022 and a second phase will immediately follow in 2024. The first two phases will allow the WWTP to meet tougher discharge limits that take effect in 2027.
Because the project will be constructed within the current fenced-in boundary of the WWTP, it is not expected to have any significant negative environmental or social impacts. An overall improvement to energy efficiency and increased level of treatment prior to discharging to the Grand River are significant positive environmental impacts.
What Will It Cost and How Will the Township Pay for It?
The total cost of all necessary improvements is estimated at approximately $78 million and the project will be constructed in multiple phases. The Township has applied for low-interest loans (est. 2 - 2.5%) from the Clean Water State Revolving Fund (SRF) to finance the construction of the WWTP improvements. The loans would be repaid over 20-years with revenue collected from sewer bills.
The Township is pursuing principal forgiveness funds that are available for energy-efficient “green” infrastructure that is offered through the SRF program.
How Are the Collected Water and Wastewater Revenues Used?
The Township’s Water and Sewer Fund are enterprise funds. This means all funds collected are maintained within the Water and Sewer Fund and used for water and wastewater-related expenses only.
Where Can I Get More Information Regarding the Water Rate Changes?
For more information about water service or the new utility rates, please contact the Accounting Department at 517-323-8510.
Where Can I Get More Information Regarding the Water Resource Recovery Facility Reconstruction Project?
For more information about the wastewater treatment plant reconstruction project, please contact the Delta Township Engineering Department at 517-323-8540 or visit our website at the link below.
Do you have an idea, question or comment for the Township? Let us know!
Lansing MI 48917
Fax: (517) 323-8599
8 a.m. - 5 p.m.