Auburn city councilors on Thursday continued their analysis of a proposed budget, with an emphasis on possible water and sewer rate increases.

The council tackled the last half of the city manager's submitted plan, which included water and sewer funds, public safety and and public works.

Water and sewer, both currently characterized as bleeding city funds, have planned fee hikes.

If the council agrees to the potential financial plan, city residents will pay 38 cents more for 100 cubic feet for water and 83 cents more for 100 cubic feet for sewer.

More than two decades ago, the city bonded $3.5 million for a sewer project that never happened. Auburn leaders then didn't have access to the total amount, so beginning in the 1990s, the city began siphoning a portion of the money to support the sewer fund. This fund is suppose to sustain itself, taking in as much revenue as needed to cover costs.

“The fact that the city used $2 (million) to $2.5 million in the past five years (for the sewer fund) shows that the fund wasn't self-supporting,” Comptroller Lisa Green said.

In 1996, the city was advised to double the then $1.80 per 100 cubic feet sewer rate. Instead, the city installed a series of three 50-cent raises during two years.

“That's why the water and sewer have an increase. They've been underfunded,” City Manager Mark Palesh said. “(The city) has been increasing property taxes instead of water rates.”

While the potential water billing changes would affect how much the contracted towns pay, changes in city sewer rates do not cause changes in sewer contracts, Green said.

“The towns' contracts are very specific what costs can be passed on,” she told councilors.

If the water rate does increase for city residents, so will the town's contracts. The new rate, $1.78 per 100 cubic feet, would bump up town rates that pay 1.05 times the city amount to $1.87 per 100 cubic feet.

Mayor Timothy Lattimore suggested new initiatives to save energy would help decrease the rates, but Palesh said any savings would affect prices for a year or two, and would trickle down.

Palesh drafted a five-year plan to pay back the debt the two accounts owe to the general fund. Those plans take that into account and can be adjusted, he said.

The budget detailed the expected impact for a family of four would see an average increase of $2.53 monthly in the water bills, and $2.77 per month for the sewer bills.

“No one likes to look at an increase but this is the right thing to do,” he said. If not, auditors may take issue with the current system.

In other news:

- William Cetti of ECO Technology Solutions spoke to the city about applying for a Clean Renewable Energy Bond program, which would allow the city to receive a no-interest bond for the pending biodigester and or collecting methane gas at the landfill. The application is due in July.

Staff writer Jessica Soule can be reached at 253-5311, ext 267 or jessica.soule@lee.net