Nashville, Tenn., Likely Faces Rate Hike

Customers in and around Nashville, Tenn., will likely pay higher water and sewer rates beginning July 1. A resolution allowing the Metro Council to implement the increases should be ready by mid-May, according to Metro Councilwoman Emily Evans. Depending on how many years the hikes are spread over, customers could pay about 20 percent more.

"It is my hope we have a recommendation to take to the council before July 1," said Richard Riebeling, metro finance director. "Whether we get there or not, we'll see. There's still a lot of work to be done."

While rates have not increased since 1996, a 2006 local water and sewer study suggested the Nashville area increase fees by 18.5 percent in 2007 and continue with double-digit increases for the following three years. A more recent report by Fitch Ratings has downgraded the area's $375-million water and sewer bonds to an AA rating and called for double-digit increases over several upcoming years.

"Receiving the 2007 update to the previous rate report is a major piece of [figuring out the rate increases]," Riebeling said.

The rate increases, which are based on consumption, are needed to help fund $556 million in capital projects planned for the next five years. A $100-million-per-year water/sewer projects budget is typical of a city Nashville's size, according to Evans. "We need to keep the system updated so that sewage doesn't leak into the Cumblerland River, so water mains won't break--things we all don't want to see. It's nothing out of the ordinary."

Area residents recently began paying fees ranging between $2.49 and $4.98 per month to fund separate storm water-specific upgrades totaling $84 million over the next five years.

Source: Nashville City Paper