The city of Siloam Springs will increase water rates for all residential, commercial, and industrial users on April 1. The rates for water and sewer services have not increased since 2007. This increase will affect everyone in the community, including John Brown University and its students.
This initial increase will be followed by a series of smaller increases each January for the next three years.
The rates are determined by a tiered system. Due to the increase, by 2016, the minimum cost for the first 1,000 gallons will have risen from $5.75 to $13.50. Each following tier will have increased by at least a dollar per 1,000 gallons by 2016.
These increases come for several reasons, according to City Ordinance No. 13-15:
• Demand is increasing for water treatment capacity as a result of area growth and development
• Cost of chemicals and other treatment inputs have been steadily increasing
• Repair for the system infrastructure, maintenance, and upgrades are needed to reduce distribution losses
• Balancing the budget while preserving services in the face of rising costs requires an increase in the city’s water rates and charges.
Holland Hayden, communications director for the city of Siloam Springs, said, “It was a hard decision that had to be made to improve the quality of life in this community.”
Hayden explained that the cost of doing business, that is, treating and distributing the water necessary for the city, has grown by 26 percent since 2005.
Siloam is also losing close to 20 percent of the water between the treatment facility and the consumers because the pipes are leaking and infrastructure needs improvement.
In addition, services such as the library, the aquatic center, and animal services are funded by the revenue from the water services. These “are not really money-makers” and yet provide services that the community enjoys and would not want to do without, so the city finds these budget increases necessary to continue providing these services.
Even after the changes, however, the city’s rates will be lower than many surrounding cities and will still be competitive, Hayden said.
Scott Jones is an adjunct professor at the University, a board member for the city and the owner of Fratelli’s Pizza in downtown Siloam.
Jones was elected to the board this fall, and one of the reasons he pursued a role in the city government is because of the utility issue. He was not in favor of the increase. As a small business owner, he knew his utilities would increase just like everyone else’s. He is concerned with the increase in costs, despite its necessity, Siloam may become less business-friendly.
“I question whether or not now is the best time to expand that revenue for those budget lines when everyone else has to tighten their belts,” said Jones.
“When is the right time?” queried Hayden. “It may not be the perfect time, but we have to do it. We cannot keep hemorrhaging water and money. Nobody likes an increase, but we have got to do it.”
University senior Kristin Pankey will be living off campus in the fall. She said that even though the utilities costs may be higher than she was expecting, it will probably still be less expensive than living on-campus, so she is okay with that.
“The water rate increase is just one example of the utility rate increases experienced by JBU over the last few years,” said Kim Hadley, vice president for finance and administration.
The University used 54,000,000 gallons of water last year, according to Steve Brankle, director of facilities services and sustainability. At the current rates, this would have cost the University over $60,000.
“I am still running an analysis of how this is going to impact us financially,” Brankle said. “I am also looking at ways to reduce our usage to hopefully absorb these increases.”
Hadley said, “While we work diligently to become increasingly more efficient in our utility usage, rate increases do place pressure on the operational budget. This fact emphasizes the importance of the sustainability projects that Steve Brankle and the Facilities Services team have undertaken. As the various utility rates increase, we have to conserve on utilization to maintain the budget.”