At the beginning of 2022, Lakehaven implemented a general increase in the water and sewer rates charged to our customers. I’d like to give you a brief overview of the many factors that influence what the District needs to charge to keep the system operating properly.
District staff works with our consultant, Financial Consulting Solutions Group (FCS), to determine what the District’s monetary needs are. FSC has worked with the District, as well as other utilities throughout the state, for many years. There are many things that FCS takes into consideration when setting water/sewer rates (e.g. historical data, inflationary factors, capital improvement projects, taxes and fees that may be levied by other governmental bodies). The District has a conservative financial policy which FSC helped us develop and which has resulted in a bond rating of AAA from Standard and Poor’s. This rating, which is the highest rating possible for a municipal bond issuer, enabled the District to recently issue bonds for the low interest rate of 2.2%, which helps to keep our borrowing costs very low. We are proud to say that Lakehaven is one of only a few utility districts in the state that has this high rating.
Capital improvements are the big driver of the rate increases, mostly on the sewer side as you can see from our rates. Both of our treatment plants have equipment that is over 30 years old and in need of replacement. As an example, the Redondo Treatment Plant needs an upgrade to the electrical and odor control systems, with an estimated price tag of over twenty-one million dollars. The work is expected to be completed in the middle of 2024. At the Lakota Treatment Plant, there are upgrades to the solids handling system that is estimated to cost seventy-seven million dollars, with completion sometime in 2029. These are just two of the big ticket items that the District is working on. There are less costly, but just as important, upgrades to the water distribution system as well that need to be made. Please feel free to contact the District if you would like more detailed information on the projects that are ongoing, as well as those that are in the planning stages.
Look for the 2022 Rate Comparison Summary enclosed in your upcoming billing statement. Lakehaven has the lowest water rates in the region and the fifth lowest sewer rates. As you can see, our rates are very reasonable. The District is proud of the efforts made over the years to provide you with safe drinking water and proper wastewater collection and treatment.
Finally, a few words on COVID 19. We continue to work hard to protect our employees as much as possible. Between April 2020 and this writing, the District has had forty-five confirmed cases of COVID infections. Fortunately, everyone has recovered. Please get vaccinated and boosted and please wear a mask. We all need to do our part to put this virus behind us.