(C. Proxmire, April 29, 2013)
The increasing cost of water, along with complications from a recent water meter reader change, have got Ferndale residents worried about their water bills. Some have reported bills increasing to over $1,000, while rumors and speculations have flooded social media sites as to why.
On April 2, The Ferndale 115 News reported the release of a water rate study and water department overview that was presented to City Council on March 25. The report gave details about how Ferndale’s water rates compared to other communities, with Ferndale being the highest of the participating communities. However, because communities have different minimum charges which were not factored into the rates, the comparisons were not as succinct as they could have been.
The one thing that is clear, is that water is getting more expensive and cities across Michigan are interested in sharing data and finding solutions.
At the March 25 meeting, Council voted to eliminate a $50 fee that was charged quarterly for delinquent bills, in hopes this would help those with their water turned off get caught up. They also instructed the City Manager and her staff to dig deeper in the rates, and to clarify the billing issues for residents.
A presentation is expected at tonight’s council meeting on the subject. The report by Jaynmarie C. Hubanks, Assistant City Manager, Finance Director and Treasurer gives more insight into the billing process. Department of Public Works Director Lloyd Cureton also shared his perspective in a recent Ferndale 115 News interview.
Why are the bills so high?
There are several factors that come into play with regard to the water bill. Listed simply, they are:
- ~Increased cost of water and sewer service from Detroit, including a shift from per unit fee to imposition of a minimum fixed fee
- ~Mandatory fees as part of the Oakland County drain system
- ~Increased cost of treatment to maintain water quality
- ~Bond debt from projects the City undertook to improve the water and sewer system, which other cities may not have now but are likely to face as infrastructure ages
- ~Increased cost of water in general
- ~Costs of maintaining the system, including labor
- ~Fewer customers using less water, while fixed costs continue to increase Therefore each customer must pay more to maintain the system
- ~“Catch up bills” from the new water meters and readers
Water has become more expensive across the country. A September 2012 survey done by USA Today shows that some communities have increased water bills of up to four times what they were just ten years ago.
The recent report shows that Ferndale’s water rate in 2003 was $5.28 per MCF and the sewer rate was $8.76 per MCF, for a total of $14.04.
For 2011 Ferndale’s water rate was $7.64 per MCF and the sewer rate was $15.92, for a total of $23.56.
In eight years the total rate increase has been 67%.
Questions have also arisen about a $33 charge on the water bills. Cureton said that is the City’s fixed fee which is charged to all customers, which helps cover fixed system costs for everyone such as the fee from Detroit.
Rumors that the fee is to help pay for the new meters are incorrect. Cureton said that the meters were paid for three years ago, and have already been helping the city save money in labor costs by not needing employees to read all of the meters.
The New Meters
The meters are the subject of rumors and concern. The March 25 report explains the meter situation “The report explains that situation:
“The City of Ferndale has been working with Elster to address issues with the reading system for the new water meters. The new meters were installed in 2009, however the Evonet radio read system failed to automatically read the water meters causing the city to continually manually read meters or estimate quarterly bills. The meters were calculating correctly, however the automatic reading system wasn’t working properly. In spring of 2012 Elster determined it could not find a solution to address the original readers and moved toward complete replacement of the meter reading system. As of March 25, 2013, 9509 readers have been replaced, which is 97% of the total project.” It goes on to explain that 94% of the new meter readers are reporting data.”
As a result of the billing lapses some customers are getting high bills. The City has been looking into these “catch up bills,” and has implemented a payment plan for people with unexpectedly high bills.
Catch Up Bills
The April 29, 2012 report explains the problem of “catch up bills.” In it Eubanks says “Due to the lack of dependable and accurate readings prior to the new radio devices being installed, many bills were estimated during this transition period. In most cases, accounts were under-billed rather than over-billed, which has resulted in “catch-up” bills going to customers at the end of January. Prior to receiving actual reads from the Elster system, however, there was no way to guess the impact of missing and estimated reads on under-billing. Since only about half of Section 1 (January 29th billings) was synchronized between the meters and new radio devices, the accounts not completed did not receive catch-up bills for January, but will receive them at the end of this month. The catch-up bills were more noticeable for the Section 2 bills sent out February 25th, due to the completion of the build out on that section and obtaining actual reads on most accounts…. The best we could do was to provide them an estimate of their usage. Although estimated bills were generated based on prior consumption, there was no reliable way to project how far behind some of the cumulative estimated readings had become from the actual reading – until the actual readings were finally obtained.”
In short, the meters continued to track water usage even though the remote reader was not working. So when the meter was finally read, it often showed a total usage that was higher than the estimate had been.
The Worst is Over
Eubanks’ report indicates that catch up bills have been sent out, so there should be no more surprises. She explained the communications involved in assisting customers who called in with questions. “As we have received calls from customers, we have explained this situation to each one. Once we review their usage history with them, most customers are satisfied that their catch-up bill is valid. In some cases, staff has prepared a multi-year history of the property usage to assist the customer in understanding their account usage,” the report said.
“DPW, Finance, and Elster staff who have been working through these issues for the past three years are hopeful that the conversion process is behind us. Based on the fact that the number of missing and estimated reads which were imported this month are close to pre-conversion levels, it appears to be the case. I would continue to encourage customers to contact the water staff or me if they need a further explanation of their water account.”
Billing questions can be addressed to the Water Billing Department at (248) 546-2374. More information on the City of Ferndale can be found online at http://ferndale-mi.com.