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EMU Required To Come Into Compliance With New Wastewater Treatment Order

By Staff | Apr 7, 2016

An order for Emmetsburg Municipal Utilities to come into compliance with recently-imposed chloride and copper standards will have an affect on all EMU sanitary sewer customers.

The order, issued by Iowa Department of Natural Resources, requires EMU to bring chloride and copper standards into compliance in the City’s National Pollutant Discharge Elimination System permit.

“The utilities will soon be required to make additional, significant capital improvements to its wastewater treatment facilities in order to comply with these new federal and state water quality regulations,” said John Bird, City Administrator.

“While the costs for these improvements are not yet known, the utility’s debt will likely double, at a minimum,” said Bird.

A look at Emmetsburg Municipal Utilities’ wastewater (sanitary sewer) department debt over the past 20 years shows that EMU has borrowed significant money through Iowa Finance Authority’s State Revolving Fund program. These funds were used to finance improvements to both its treatment plant facilities and for a main trunk line replacement project.

“As of February, 2016, EMU’s wastewater department has outstanding debt equaling $1.541 million,” said Bird. “In fiscal 2017, the annual debt service payments related to this outstanding debt will be approximately $190,500. Although the interest rates on these outstanding debt issuances are very low (1.75% and 3.00%), the annual debt service payments still place quite a burden on the utility’s cash flow.”

Considering the newest state mandate, which must be instituted at an unknown cost, Emmetsburg Municipal Utilities Board of Trustees has voted to establish a debt service surcharge to its customers.

“The EMU board has deemed it necessary to implement a $5 monthly debt service surcharge to be included on every sewer customers’ bill,” said Bird. “This surcharge will generate approximately $96,000 in additional revenue annually which will be placed in a fund designated for servicing existing and future sanitary sewer utility-related debt.”

The $5 surcharge will become effective with the May, 2016 billing.

As the EMU board and administration continue to evaluate the full financial impact of compliance with water quality standards, in addition to the utility’s ongoing and significant capital demands for infrastructure replacements and improvements, the need to adjust the volumetric component of the sewer rates may arise.

In its preliminary draft order to EMU, the Iowa Department of Natural Resources has included a requirement for the Utilities to “inventory the number of residential ion exchange (salt) water softeners that discharge into Emmetsburg’s wastewater collection system, and inventory the number of softeners that regenerate based on flow versus regenerating based on a timer.”

“Emmetsburg Municipal Utilities will request an amendment to this draft requirement to allow for a mail-in survey rather than physical inspections of in-home systems,” said Bird.

Additional information will be provided to the public as this process unfolds.