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June 25, 2013In counteracting an $83,000 operating deficit in its sewage fund last year, the Town of Golden Meadow has increased its sewer-use rates and relinquished authority over collections.
Golden Meadow’s sewage fund has operated at a deficit every year since 1995, requiring about $615,000 in total subsidies, an average of $34,000 per year, according to audit reports. Its deficit in 2012 was by far the largest.
“Every department should be able to sustain its own expenses,” Golden Meadow Mayor Joey Bouziga said.
Golden Meadow has pulled from its sales tax and gas distribution funds to cover the losses, the mayor said.
Since 1995, the municipality’s sewer operating expenses have risen from $28,000 to $138,000, nearly 400 percent, as the town has expanded its services, including construction of a new treatment plant. Comparatively, the gas distribution fund has remained relatively steady, jumping from $220,000 to $278,000.
Bourgeois Bennett, a Houma-based CPA firm, conducted Golden Meadow’s annual government audit for 2012. In the report, made public Monday, auditors recommended the town consider raising its rates and pursue uncollected amounts.
The town council voted unanimously in March to raise sewer rates to a flat rate of $15 per month up to 2,000 gallons of use at metered households. It was previously $7, Bouziga said.
After the cap is exceeded, residents pay $3 per 1,000 gallons. For residents without meters the flat rate is $20.
In addition to the rate changes, the town turned over fee collections to Lafourche Parish Water District No. 1.
State law permits water districts to collect sewage fees for various public and private entities, a service Water District No. 1 provides for multiple partners, said Dirk Barrios, the water district’s general manager.
Although a sewage provider that wishes to penalize excessively delinquent accounts would have to dig up sewer lines to shut off service, a cost- and labor-intensive process, a water district can enfold sewage-fee collection with its water collections and penalize nonpayers simply by turning off access to water.
“We’re used as the enforcer, basically,” said Barrios.
Golden Meadow allowed for $10,300 in uncollected sewer fees in 2012, an increase from $1,500 in both 2011 and 2010, according to audit reports.
“We had no way to collect,” Bouziga said. “It’s something we’ve been looking at for several years.”
In addition to putting the fund on stable footing, the town needs to increase its sewage revenue to prepare for future construction and maintenance expenses, such as upgrades to the north treatment plant and various pumps to keep in line with mandated standards, Bouziga said.
Taxes were out of the question because not all of the town’s residents utilize its sewage system, the mayor added.
