Vicksburg Eyes Sewer, Water Upgrades, Rate Hikes

vix vc obrien
State Senator Margaret O’Brien attended the Vicksburg Village Council meeting to announce a grant from the state. It is $55,000 to resurface Wellhouse Drive near Sunset School. It was awarded as part of the state’s request for shovel-ready projects according to O’Brien.

By Sue Moore

Water and sewage disposal rates could increase by $80 or $90 per quarter for an average user if the Vicksburg Village Council follows recommendations from its engineering and financial consultants.

Council members reviewed an analysis by Mike Swartz, senior engineer from Prein&Newhof and the village’s consultant on sewer and water infrastructure. His report was derived from studies conducted over the last two years, with 90 percent funded from a grant from the state of Michigan.

The analysis focused on the work that needs to be done in capital improvements from 10 to 20 years out, Swartz said. He brought in an expert on financing major sewer infrastructure from Umbaugh & Associates, a Lansing financial advisory firm represented by Andy Campbell.

The total estimated cost for improvements is $11,673,500. Campbell said the best way to finance a project of this magnitude would be through a bond issue through the U.S. Department of Agriculture and that the application needed to be made within the next few months to lock in the most favorable rates.

To pay off these loans would require an increase in rates for both utilities, Campbell explained in his cash flow analysis of the two systems. The more costly improvements are to the sewer infrastructure. A 40-year bond issue of $8.9 million would require increases for an average homeowner, one using 13,500 gallons per quarter, from $82 now to $126 in 2018-2019, $157 in 2019-2020 and $163 in 2020-2021.

Water rates to make the debt service payments on a $1.37-million 40-year bond with a finance rate of 3.125% would increase each year from $61.35 per quarter currently to $63.48, $65.70 and $68.00 by 2020-2021.

The council had been reviewing these findings for several months with Swartz but this is the first time the entire board was included in the presentations. “I thought the members were extremely calm in their reaction,” Swartz said. “They understand the need for the project and that rates will need to increase to pay for it. They are being pro-active to manage the system and maintain their assets that are all underground in the best way possible.”

Village Manager Jim Mallery received a raise and praise from his bosses.

Trustee Gail Reisterer summed it up for the Council: “The Village must continue to feed the positive momentum we have generated in recent years. The Council believes that Mr. Mallery is the right person to keep leading us in our mission to be the best small village in America. Thus, we propose a 2.5 percent raise to his base salary to bring it to $70,213 and a one-time performance bonus of five percent for 2017-2018.”

The council sweetened the deal with a unique salary incentive – $5,000 for each of the remaining four years of his current employment contract; he will be eligible to collect the $20,000 if he remains village manager through the year 2022. “The council is confident this compensation package will be an excellent investment in the future of the Village,” Reisterer said.

Reisterer has been consistent in her support of Mallery, saying he has brought superb budgeting skills and money management to his position over the last two years as village manager. To demonstrate this, he spent the better part of his manager’s report outlining the quarterly budget adjustments that needed to be made to conclude the 2017-2018 fiscal year with a balanced budget. It is especially sweet for the council as it has insisted upon this while driving to increase the fund balance up to a goal of 15 percent this fiscal year. That has been achieved.

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