Questions about the $8 million bond for wastewater system improvements being sought by the Cabot Water and Wastewater Commission were fielded by chairman Gary Walker during a special meeting held Monday. The meeting was called after questions about the projects could not be answered at the Feb. 2 Mayor’s Breakfast.
Committee members Ed Long, Ann Gilliam, Angie Jones, Dallan Buchanan, Jon Moore, Ryan Flynn and Rick Prentice attended the meeting. Mayor Bill Cypert attended as an observer, but still contributed to explanations.
The wastewater system improvements are one of the bond issues being put to voters at the April 9 special election on refunding the current sales and use tax for improvement bonds. The tax is a one-percent city sales tax.
Cypert has proposed the refunding to fund six improvement projects, including a new interchange, parks and recreation improvements, community center renovation and expansion, library relocation and expansion, and drainage projects for the Highlands area.
Opening the meeting, Long emphasized that there was little choice with the listing of the projects on the ballot. It is a matter that is already settled and the only option other than proceeding with the election is to repeal the entire ballot, he said.
Long said probably the only benefit to be realized from the special meeting would be for a clarification of the water and wastewater rate increases to be expected.
During the breakfast session, resident Tom Standley challenged the bond proposal on several points, specifically a rate increase that would be imposed even if the bond was approved. Standley asked that the wastewater projects be removed from the ballot.
The council, Standley said, had proceeded too rapidly and had left little or no time for discussion.
The proposed bond-funded projects are in an area bounded by Arkansas Highways 5 and 89, U.S. Highway 67/167, and Magness Creek North. Many of the improvements would reduce the need for pumps by changing to a gravity flow and would be less costly to operate, Walker said Monday.
Walker explained that the bond issue is being pursued to reduce the amount the rates would be increased. Regardless of the bond approval, the wastewater projects must be done to avoid a consent decree from the Arkansas Department of Environment Quality (ADEQ) and the federal Environmental Protection Agency, he said.
There are a wide range of deficiencies in the wastewater system, such as storm and ground water entering the system, system overflows, and deteriorating lines, especially old concrete lines, that must be corrected, Walker said.
A consent decree to correct system deficiencies would be much more costly to rate payers by requiring a rate increase, Walker said. “Rates are forever, bonds can be retired,” he remarked.
During Walker’s 30-minute presentation on the proposed improvements, he noted that approval of the bond would still require rate increases but at a much lower rate.
Without the bond, the first rate increase would more than double the current rate, followed by step increases of 5, 10 and 15 percent, Walker said. The current rate of $9.81 for the first 5,000 gallons would be increased to $23.69 by 2016.
With the bond to fund the projects, the rate by 2016 would be $12.97, reaching $19.73 by 2019, Walker said. “It is an easier way to pay,” he said.
Further improvements to the south of the city, along Arkansas Highway 321, Ford Bottoms and Holland Bottoms would be funded through rate increases, Walker said.
Jones said she had “done the math,” and found that she would have to increase her annual spending by $700 to $900 to see the same increase from the sales tax as the difference made by the first projected increase of the wastewater rates without the improvement bond.
Cypert added that Cabot has a history of early payment of bonds, often in half the projected time. Even if Cabot were to stop growing, the bond would be paid in 16 years, he said.
The Mayor’s Breakfast is a quarterly event by Cypert as an informal setting for public comment.