Lower Township MUA Board of Commissioners

VILLAS — Lower Township Municipal Utility Authority (MUA) is proposing a slight rate increase in water and sewer rates.

MUA’s Board of Commissioners introduced a 2010 budget Oct. 7. A public hearing will be held during MUA’s Nov. 4 meeting at Lower MUA headquarters.

MUA Executive Director Mike DeMarcantonio said despite budget cuts instituted, operations streamlined and purchases reduced, rate increases were necessary. Health benefit costs for employees has risen 25 percent as well cost increases for electricity, chemicals, sludge removal and insurance.

In a written statement, he said a balanced water budget would call for a 30 percent increase across the board. DeMarcantonio said he was calling for a 10 percent increase and will use funds from the utility’s surplus account to balance the budget.
He said he hoped to continue to reduce expenses, streamline operations “a little more,” complete a water main project on three streets in Villas and gain more customers to reduce the amount of money needed from the surplus account.

A balanced sewer budget would call for a 10 percent increase in rate. DeMarcantonio said he is asking for a 5 percent increase and will use surplus funds to balance the sewer budget.
The water rate increase for residential customers with a 5/8-inch meter is $22.72 per year, amounting to $5.68 per quarter or 6 cents per day.

The increase in sewer charges for residential customers is $15.40 per year, which amounts to $3.85 per quarter or 5 cents per day.

He offered a comparison of Lower Township MUA’s water rates with Cape May and Wildwood. A quarterly water rate comparison for a minimum of 10,000 gallons per quarter showed Cape May with a bill for $92.30 in winter and $140.60 in summer. The same consumption in Lower Township would cost $62.48.
In comparison, Wildwood’s water bill would be $46.79.

DeMarcantonio noted a number of items reduced for lowered expenses for ratepayers:
• Saved $7,600 per year on telephone service.
• Saved $3,000 on cell phone service.
• Joined a Joint Insurance Fund for a savings of $58,000 per year.
• Changed fuel purchases to county facility for a savings of $40,000 per year.
• Combined superintendent and supervisor jobs for savings of $103,000.
• Saved on costs of an outside engineering firm: $77,000.
• Outsourced lab work for savings of $34,200.

Among items proposed for savings in 2010 is a controversial proposition of combining two office positions to one chief financial officer position for a savings of $73,302. (See related story).

Former Lower MUA Executive Director Robert Fothergill said rates were not raised during his 10 years with the authority.
“That’s why we are in the condition we are in today,” replied DeMarcantonio.

Fothergill said rate increases could not have been brought on at a worse time.

“Where are some of these people on fixed incomes going to find the money to pay their utility bills?” he asked.

The proposed 2010 budget projects $185,337 in connection fees, up from $3,828 in 2009, due to a mandatory connection ordinance from the township that requires property owners to hook up to the water system when pipes are placed in their street.

The budget projects $6,800 revenue from interest on investments and deposits, down from $70,000 in 2009. DeMarcantonio said that was one of the reasons he wanted to hire a CFO to watch that line item more carefully.

Administrative costs are increasing from $529,950 to $644,450. Salaries and wages are $361,750, down from $378,275 in 2009.