Sewer Hikes in the Pipeline

The Little Rock, Ark., Board of Directors last week approved a series of four rate increases for the Little Rock Wastewater Utility through 2016 to finance construction of facilities needed to comply with a 2001 lawsuit settlement.

The city expects to issue up to $200 million of new debt over the next three years for sewer projects.

The Sierra Club sued the utility to stop the releases of untreated sewage into the Arkansas River after heavy rains because of insufficient capacity provided by the utility’s two treatment plants.

The 2001 agreement was extended and reinforced by a consent order issued by state regulators in 2006. The original agreement had a compliance deadline of Dec. 31, 2009, but the state order extended it to 2016.

The rates will go up by an average of 12.75% this year, 8% next year, 7% in 2014 and 4.8% in 2016.

Residential users will see smaller increases.

The average residential customer will pay $41 a month when all the increases are accomplished, the city said, up from pre-lawsuit $13 a month in 2000.

The $263 million of outstanding debt issued for the sewer utility by Little Rock is rated Aa3 by Moody’s Investors Service.

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