FARMINGTON – Selectmen sat down with the agency that provides water for the town’s fire protection this evening, to discuss a proposed rate increase.
Farmington Village Corporation, a non-profit, quasi-municipal organization which provides water for more than 1,500 local businesses and residences in Farmington, Temple and a small part of Wilton, sent representatives to discuss a proposed round of rate increases for 2009. The increase varies depending on usage, but the selectmen are particularly concerned with a requested 13 percent increase for public fire protection.
This would raise the cost of that protection by $30,000. In 2007, Farmington budgeted $230,000 for public fire protection. The last increase was in 2006.
“What obviously caught our attention,” Selectman Chair Stephan Bunker said, “especially as we enter this budget period, was this line item for hydrants and this increase in rates.”
The proposed rate increase for residences is 8.6 percent. FVC Business Manager Jane Woodman estimated that the average residential customer would pay roughly $236 annually.
Selectmen were interested to hear why an increase was warranted, and what the process entailed. Maine Rural Water Association’s Steve Levy, who audits FVC to help determine what rates should be set at, said that the town’s allotment of FVC’s gross annual revenue was set by law.
“Invariably what happens,” Levy, who works with similar utility systems across the state, said, “for most mid- and small-sized towns’ fire protection is that there is a cap of 30 percent, even though the formula curve sets Farmington at 46 percent.”
The logic behind the high percentage, Levy said, was that fire protection requires water systems to be far more robust than they would typically need to be to just provide drinking water.
“The water system is much bigger to knock down a fire, then it would be to simply provide these other services,” Levy said.
There was little debate on the 30 percent, but instead selectmen questioned FVC’s budget. Selectman Jon Bubier questioned whether the agency was “digging deep enough” in such difficult fiscal times.
“We are looking at cutting programs back anyway we can,” Bubier said, “what are you doing to cut costs?”
Woodman gave a few examples. FVC is trying to save electricity by running pumps at night, as well as installing new meters to thwart new power company fees. The problem, she noted, was that the cost of raw materials was going up. Replacement hydrants, for instance, now cost $3,000 to install. Furthermore, Levy said, the small size and comparatively cheap water in Farmington make it ineligible for most USDA and state grants.
“The good news is that you have good, cheap water,” Levy said. “The bad news is that you, well, have good, cheap water.”
There is a public hearing set for Thursday at 7 p.m. at the FVC office on High Street. That hearing will effectively alert residents to the rate changes.
There is a petition process which can be used to appeal the increase. That petition would begin a review undertaken by the Public Utilities Commission, wherein FVC would be reviewed and a new rate eventually negotiated. Levy said that rates occasionally did come down further after the arbitration, but rarely significantly so.
