Statesville OKs rate hike for utilities, fees

Statesville residents and business owners will pay more for electric, water, sewer and fire inspection services under an $82.4 million budget the City Council adopted Monday.

The increases will go into effect July 1 as part of a spending plan that includes no salary increases for city workers, despite pleas from firefighters and their families.

When the budget was proposed in May, Mayor Costi Kutteh said, "This is a daunting task every year and perhaps more daunting than usual this year." After seven hours of budget meetings and workshops, little seemed to have changed Monday night as Kutteh labeled the new budget "the toughest in my 21 years."

Like many other municipalities, Statesville attributed the difficult budget decisions to "a bleak economic picture" complicated by a 15 percent increase in health insurance costs and a 31 percent increase in retirement costs.

Here are highlights of the new spending plan:

Electric rates increase 5 percent. The hike is essentially a pass-along of a wholesale rate increase from Electri-Cities, which provides electric power to the city. It's the third consecutive year the city has raised electric rates.

Water and sewer fees up 6 percent. The increase would be the first since 2005, and it is needed, City Manager Rob Hites said, "for the long-term fiscal health of the water and sewer fund."

Taken together, the new electric and water/sewer fees are estimated to cost residents an additional $90 annually, while city businesses will pay over $200 more per year.

Tax rate stays the same. The city's property tax rate remains at 38 cents per $100 assessed valuation. For a home with an assessed value of $250,000, city taxes for the next year should stay at about $950. The city's tax rate hasn't changed since 2003.

Fire inspection fees. An expanded fee and permit schedule for inspections and other services provided by the Fire and Life Safety Division will go into effect July 1, generating an estimated $66,000 in revenue during fiscal 2010-11. Nineteen fees will be increased by as much as $20 each. New permits and fees have been established for such events as carnivals, fairs and trade shows.

New firefighters. Rejecting options to increase taxes or enact a sanitation fee, the council agreed to transfer enough money from an existing fund balance to start training in May 2011 for the 15 firefighters needed to staff the city's new station. The station is due to open next summer.

After the vote, Kutteh left little doubt that next year's budget could be even more troublesome: "We'll have some big-ticket items to consider, such as a full year of funding the 15 new firefighters, and the impact of revaluation."