As the City of Jefferson continues planning to replace its wastewater treatment plant, residents will see an increase in their sewer rates to pay for the project.

It was mentioned at the most recent city council meeting that in order to finance the preliminary cost estimate of the $10-12 million project, it was proposed to increase the sewer rates to 5.5-percent over the next five years. City Administrator Mike Palmer says sewer rates are annually increased by three-percent, so there would be an additional 2.5-percent increase for each of the next five years.

Palmer points out preliminary estimates to increase sewer rates anywhere from 7-9-percent, so he believes 5.5-percent is reasonable. He notes the rate increase works as a certain kind of bond that the City pays for through the Iowa Finance Authority, which then reimburses the City.

“It’s actually the bonding companies that look at this to see and they calculate what kind of rate increase would need to happen to pay for the bonds, the amount of money that’s being estimated to redo the sewer plant. It’s a different kind of bond, it’s usually what they call a revenue bond, and it’s tied directly to the user fees. It’s not a tax assessment on anybody, it’s all based on fees.”

Following the most recent streets/sewer/sanitation/water committee meeting from this past week, the city council is expected to consider approving the first reading of the amended ordinance to increase sewer rates to begin at the start of the next fiscal year on July 1st.