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(A) The City Council has determined that the purpose of sewer and water rates is to produce sufficient revenues each year to pay the costs of service. The City Council has found that annual revenues and expenditures of the system can fluctuate as much as 25% from year to year. Based on the recommendations of the city's engineers, City Council has determined that, in order to provide adequate, but not excessive, annual adjustments in revenue levels in a timely manner, the Department shall develop the costs of service based on 5 year projections of cash needs, adjusted for inflation, and shall base rates each year on the estimated needs for those 5 year periods, adjusted annually.
(B) The costs of service to be paid from revenues shall include all of the following:
(1) Operation and maintenance expenses;
(2) Debt service expenses; and
(3) Capital expenses not funded from bonded indebtedness.
(1993 Code, § 68-97) (Ord. passed 1-22-2001; Ord. 2014-01, passed 1-27-2014)
(A) The city shall pay the same water and sewer rates for service to the city as would be payable by a private user for the same service.
(B) In addition, in recognition of the capacity requirements of fire hydrants, the city shall pay a fee equal to 5% of the annual budgeted revenues of the water supply system.
(1993 Code, § 68-98) (Ord. passed 1-22-2001; Ord. 2014-01, passed 1-27-2014)
(A) Charges for water and sewer usage shall be paid within 30 days of the date which they are billed. Payments shall be deemed made when they are received in the Treasurer's office or a city authorized depository. If payment is not made as provided in this section, a penalty of 10% shall be added to the bill. Failure to receive a bill shall not relieve the customer from the responsibility for payment.
(B) Such charges shall constitute a lien upon the respective properties served and if any charge is not paid before it becomes delinquent it may be recovered by the city in an action in assumpsit against the owner of the property served as well as any tenant supplied with such water, or such charges may be certified to the City Treasurer by the City Council and assessed against the property on the next city tax roll, in which event such charge shall be collected and returned in the same manner as other city taxes are collected and returned; provided that any charge shall not be so certified which has not been delinquent for a period of a least 6 months. The effective date of certification by City Council shall be May 1 of each year. In addition to any other remedy provided in this chapter or by law, if such charges for water consumed is not paid as provided in this section, the City Treasurer shall have the authority to shut off the supply of water to any such premises, provided:
(1) Delinquent notice is provided by first class mail to the account holder, which shall serve as due process, prior to the water being shut off;
(2) Shut off notice is provided to any occupant(s) of the property by posting notice of same at the premises at least 3 days prior to the water being shut off;
(3) After shut off, such connection shall not thereafter be reconnected until all such water charges and penalties shall be paid, together with turn-on charges.
(C) If the city shuts off the water supply by mistake, the City Manager or his designee is authorized to credit the property owner an amount equal to the shut-off fee.
(D) (1) It is the policy of the city to discontinue utility service to customers by reason of nonpayment of bills only after notice and a meaningful opportunity to be heard on disputed bills. The city’s form for application for utility service and all bills shall contain, in addition to the title, address, room number, and telephone number of the official in charge of billing, clearly visible and easily readable provisions to the effect:
(a) That all bills are due and payable on or before the date set forth on the bill; and
(b) That if any bill is not paid by or before that date, a second bill will be mailed containing a cutoff notice that if the bill is not paid within ten days of the mailing of the second bill, service will be discontinued for nonpayment; and
(c) That any customer disputing the correctness of his bill shall have a right to a hearing at which time he may be represented in person and by counsel or any other person of his choosing and may present orally or in writing his complaint and contentions to the city official in charge of utility billing. This official shall be authorized to order that the customer’s service not be discontinued and shall have the authority to make a final determination of the customer’s complaint.
(2) Requests for delays or waiver of payment will not be entertained; only questions of proper and correct billing will be considered. In the absence of payment of the bill rendered or resort to the hearing procedure provided herein, service will be discontinued at the time specified, but in no event until the charges have been due and unpaid for at least 30 days.
(3) When it becomes necessary for the city to discontinue utility service to a customer for nonpayment of bills, service will be reinstated only after all bills for service then due have been paid, along with a turn-on charge of such amount as is authorized from time to time by Council by resolution.
(1993 Code, § 68-99) (Ord. passed 1-22-2001; Ord. passed 1-14-2002; Ord. 2014-01, passed 1-27- 2014; Ord. 2021-10, passed 8-2-2021)
(A) The City Council has determined that not all classes of users of the system cause the same costs of service. Based on the recommendations of independent engineering consultants to the city, City Council has determined the following:
(1) The commodity costs of water supply and some portions of the costs of sewage disposal are uniform among users in accordance with the volume of use;
(2) Indirect costs of water supply and sewage transportation, including size of service pipe, materials used, locations of meters, size of storage and treatment facilities, and maintenance, billing and collection costs vary according to the size of meters;
(3) While all users benefit equally from capital improvements to the system, users taking possession of previously undeveloped properties, and users changing the nature and amount of use of the system at renovated or expanded properties would not bear equally the cost of those capital improvements unless required to pay a system equity charge;
(4) Certain types of property uses require a reservation of a greater capacity of the system than others;
(5) At least 50% of the costs of service to all customers is related to the indirect costs of service;
(6) Current technology does not support the efficient and cost effective metering of sanitary sewage discharged into the sanitary sewage disposal system. As a result, the city has determined that the most equitable measure of the volume of sanitary sewage discharged into the system is the amount of water consumed;
(7) The city will offer service to properties located outside the city limits only pursuant to city-township contract.
(B) The City Council has therefore developed the following classes of users.
(1) For meters of the following sizes, the following meter equivalency ratios for purposes of allocating the base amount of the indirect costs of service and calculating the quarterly base rate per meter size:
Meter Size (inches) | AWWA Meter Capacity Ratio |
Meter Size (inches) | AWWA Meter Capacity Ratio |
5/8 and 3/4 | 1.0 |
1 | 1.6 |
1-1/2 | 3.3 |
2 | 5.3 |
3 | 10.0 |
4 | 15.5 |
6 | 33.3 |
(2) All classes of users shall pay the same rate per gallon of metered water for water supply and sewage transportation services.
(3) For purposes of calculating the system equity charge, City Council has decided to use a table of unit factors, a copy of which is on file with the Director, based on a unit equaling 250 gallons of water consumed per day per year, as recommended by the city's consulting engineers.
(4) The base charge shall be calculated so as to produce no less than 50% of the annual budgeted expenditures of the system.
(5) The amount of water consumed is generally an appropriate and fair indicator of the amount of sanitary sewage discharged into the sanitary sewage disposal system.
(6) Where a user discharges sanitary sewage into the sanitary sewage disposal system but does not use the water supply system, or where a property uses large quantities of water that are not disposed of through the sanitary sewage system, the Department shall propose and the City Council shall adopt, methods of allocating the costs of service to those properties based on the estimated use of the sanitary sewage system.
(1993 Code, § 68-100) (Ord. passed 1-22-2001; Ord. 2014-01, passed 1-27-2014)
(A) Consumption charge. Every user shall pay a consumption charge calculated on the basis of metered gallons per day of water consumed at a rate determined by City Council to produce an estimated 45% of the annual budgeted revenues of the system.
(B) Base charge. Every user shall pay a base charge calculated on the basis of meter capacity ratio in an amount determined by Council to produce an estimated 50% of the annual budgeted revenues of the system.
(C) System equity charge. The purpose of the system equity charge is to recover certain of the capital costs incurred to provide sufficient capacity to all users from those users that have not previously paid their share of those costs. Every person seeking to utilize the system for a use estimated to demand the reservation of greater capacity of the system shall pay a system equity charge established and managed as provided in this section.
(1) Calculation of estimated demand on capacity. The estimated demand on capacity of the system shall be based on the unit factor assigned to the type of use described in the table of unit factors approved by City Council from time to time, based on historic average use for each type of use.
(2) Calculation of system equity. System equity shall be determined annually on the basis of the value of system assets comprising the backbone facilities of the system, including, but not limited to, wells, reservoirs, treatment plants, mains, distribution mains and high service pumps, plus funds in the Replacement and Improvement Fund, plus accumulated depreciation, less the amount of any grants received to fund system assets, and less the principal amount of bonds remaining outstanding and incurred to finance those assets.
(3) Calculation of system equity charge. The system equity charge shall be determined each year as follows:
System Equity x residential equivalent unit factor Total number of existing Meter Equivalent Units
(4) Credits. If the system equity charge relates to an increase in demand on capacity, the city shall provide residential equivalent unit credits in the following order:
(a) The number of documented residential equivalent units previously paid for connection of that property to the system;
(b) If the number of residential equivalent units paid for previously can not be identified, the residential equivalent units shall be determined by the latest 2 year average billable flow divided by 250 gallons per day per year;
(c) If the latest 2 year average billable flow cannot be determined, the residential equivalent units shall be determined by the table of unit factor based on the properties' previous use.
(5) Use of proceeds of the system equity charge. Proceeds of the system equity charge shall be used exclusively to pay for replacements and improvements to the system, other than extensions of service to new users.
(6) Appeals. A person may challenge the unit factor applicable to the property being connected to the system, or the amount of the system equity charge by bringing an appeal to the Utility Board of Appeals within 24 months of payment of the charge and after review of the City Manager. In considering the appeal, the Utility Board of Appeals shall take into account the historical volume of use by the appellant for the previous 24 months.
(D) System equity charges for buildings built before 1960. The purpose of this section amendment is to encourage the redevelopment of structures originally constructed before December 31, 1959. For all structures built before this date which: 1) involves a change of use and 2) which use is estimated to demand a greater reservation of capacity, the equity investment fee shall be half of the fee set by resolution of the City Council for new construction. By resolution of the City Council, payment for the equity investment charge can be deferred for a period of up to 2 years. Any deferrals shall be filed as a lien on the property.
(E) Tap fee. Each person connecting to the system shall pay the actual costs of the material, meter, labor, equipment and supervision related to the installation of the connection and the meter, plus an administrative charge equal to 10% of the actual costs of the connection.
(F) Inspection fee. Each person connecting to the system shall also pay a fee for inspection of the premises during connection to the system, which fee shall be set from time to time by City Council by resolution.
(1993 Code, § 68-101) (Ord. passed 1-22-2001; Ord. passed 1-13-2003(1); Ord. 2014-01, passed 1-27-2014)
As authorized by the provisions of Public Act 94 of 1933, being M.C.L.A. §§ 141.101 through 141.138, as amended, if a user shall fail to pay a bill within 6 months of the date on which the bill is due and payable, the delinquent bill and all penalties thereon shall become a lien on the premises served. The City Assessor shall place such charges on the next general tax roll, and the charges shall be collected in the same manner in all respects as provided by law for the collection of taxes by the city.
(1993 Code, § 68-102) (Ord. passed 1-22-2001; Ord. 2014-01, passed 1-27-2014)
§§ 68-103 – 68-119 RESERVED.
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