Westwego faces lawsuit over $1.3 million water storage tank contract _lowres

Advocate staff photo by JOHN McCUSKER -- The Westwego water plant. Westwego has scrapped a plan to replace its water treatment facility behind City Hall, deciding instead to repair and modernize the facility.

After years of subsidizing the cost of water service by raiding the city's general fund, the Westwego City Council is expected to raise the rates paid by businesses and residents next year.

The council will vote Monday on whether to increase rates for residential water consumption and create a separate rate for commercial users. There is also a measure on the agenda for the council's regular monthly meeting to build in a 2 percent annual increase to cover inflation.

The new rate structure, which would take effect Jan. 1, would increase the residential rate for the first 2,000 gallons from $6.38 to $10 per month, an increase of 57 percent. Residents would pay $3 for each 1,000-gallon increment above that, up from $1.82 at present.

Mayor Joe Peoples said 25 percent of residents use less than 2,000 gallons per month, and about 17 percent use between 2,000 and 3,000 gallons.

The new plan would also create separate rates for commercial users, who now pay the same as residents. Those rates would be $14 for the first 2,000 gallons and $4 per 1,000 gallons after that.

Peoples said 50 percent of commercial users pay the base rate, which will more than double under the new plan.

Westwego, which has an aging and dilapidated water plant, has bought its water from the parish for several years. But the 54 cents it pays the parish per 1,000 gallons will rise to 99 cents per 1,000 gallons in January, with a 2 percent increase per year.

For about a decade, the city has been drawing $400,000 to $700,000 per year from the general fund for water service alone. The city's sewer system also runs an operating deficit of about $400,000 a year, though there are no immediate plans for a sewer rate increase.

Peoples said the water rate increase is necessary to “try to get us out of this hole that we’re in.” He said a recent message from the state Legislative Auditor's Office was clear: “The city’s going to go broke if you don’t find a way to turn it around.”

The city has historically struggled to find ways to cover its water costs. A 2-mill property tax proposed in 2015 failed by two votes out of almost 1,000 ballots cast. The year before, the council reduced a rate increase proposed by the administration and was able to pass it only after instituting a two-year cap.

Westwego water millage fails by 2 votes, sewer by 17 votes

Councilman Glenn Green, who said he proposed that cap out of concern for residents who are elderly and on fixed incomes, said Friday he supports the new rate increase and expects it to pass.

"It’s not something we want," he said. "It’s something we need."

He added, however, that he will propose shortening the term from 10 years to five.

The higher rates are expected to generate about $538,000 per year in additional revenue. Peoples said any excess funds raised will be put toward fixing leaking waterlines and replacing meters, a job the city estimates will cost $12 million. He said the city has put in for state capital outlay funding to tackle that work.

Peoples said Westwego's water rates are "lower than just about everywhere else.” He said he looked into getting grant money from the U.S. Department of Agriculture, but that agency told the city its rates were too low to qualify for assistance.

Gretna is the only municipality in Jefferson Parish that supplies its own water; the others are part of the parish system. Then there is Westwego, which distributes the water to customers but buys it from the parish.

Gretna charges a base rate of $12.46 for up to 2,000 gallons for residential customers and $4.21 for every 1,000 gallons above that. Its base commercial rate is $19.60 for the first 2,000 gallons and $5.76 for each 1,000 gallons after that.

Peoples said he tried to convince the council to become part of the parish's water system, to no avail.

"It’s just a no-brainer that a small city like us should not be in the water business," he said.

But the council didn't back the move, and in the meantime the parish became cool to the idea after it took a closer look at Westwego's aging system of pipes, Peoples said.

As much as 42 percent of the water used in the city leaks out of its aging waterlines, Peoples said, more than twice the national average.

Peoples said the city's water plant, which was built in the 1920s, is a money pit he has no interest in continuing to feed. He estimated it would take another $3 million to get it back into operation.


Follow Chad Calder on Twitter, @Chad_Calder.