By Bay Stephens EBS LOCAL EDITOR
BIG SKY – On Aug. 20, the Big Sky Water and Sewer District approved a rate hearing concerning a new rate structure for billing sewer and water services that would involve a 5 and 10 percent bump to residential and commercial sewer accounts, respectively, and lower thresholds for water upcharges.
The hearing will take place sometime in September, and the district will notify all ratepayers.
As massive bills come down the pipeline for a new wastewater treatment plant to meet Big Sky’s blistering growth, the district board hired rate consultants from Advanced Environmental Engineering and Services’ Bozeman office to determine how to balance the budget by aligning the cost of services with the amount the district charges classes of sewer and water users.
Sewer rate changes
Base sewer rates will increase 10 percent across the board, while volumetric rates will increase 5 percent per thousand gallons for residential users and 10 percent for commercials users for the rate hearing.
To shoulder operations without sharp rate increases in the span of a year, the AE2S consultants recommended yearly rate increases of around 5 percent for residential accounts for the next five years; for commercial accounts, the recommendation included 20 percent increases each of the next two years and 10 percent increases the following three years.
Ryan Graf, an AE2S rate consultant, said that increasing rates before debt service plus operations and maintenance costs of the new wastewater treatment plant come online builds in a financial reserve so that the district can avoid slamming ratepayers in any one year.
In the previous rate structure, residential and condos were overcharged 24 and 11 percent, respectively, while the commercial class was 34 percent undercharged for the cost of the district providing sewer services.
The recommended rate structure from AE2S incorporates consistent resort tax funding, so the BSWSD board discussed developing a plan to explore long-term funding options with the Big Sky Resort Area District board.
Water rate changes
On the water side, the board approved a hearing for a tweaked tier structure that lowers tier thresholds and includes a specific irrigation tier; they also adopted a 9 percent increase to the rates for water services for the coming year.
The new structure increases rates by 9 percent this year, and will have four tiers with increasing rates as water users move into higher tiers. The lowest tier is from 0-20,000 gallons and will be charged at $2.98 per thousand gallons
The current rate structure bills 0-60,000 gallons at $2.73 per thousand gallons.
The irrigation rates start at a higher tier, which aims to incentivize less water usage in Big Sky’s water-scarce environment.
Rates have increased an average of 6 and 9 percent for water and sewer services, respectively, in the last three years, according to district financial officer Terry Smith.
Mike DuCuennois, BSWSD board member and Yellowstone Club’s vice president of development, is working with the rate consultants and district staff to determine how to charge the club commensurate to their wholesale water sale, which has a maximum of 216,000 gallons per day.
In other news:
- The board approved Lone Mountain Land Building 4 for the requested capacity submitted by Bechtle Architects. The building will be across from the Town Center Plaza on Town Center Avenue.
