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City utility increases unfortunate but understandable

Beginning next month, utility customers in the city of Marquette may have to dig a little deeper into their pockets when they pay their bills.

That’s because the Marquette City Commission last week approved a 7 percent rate hike for the city’s three utilities – water, wastewater and stormwater.

The new rates, effective Oct. 1, will cost a typical residential customer nearly $6 extra each month, which equates to about $70 annually.

In 2013, the Marquette Board of Light and Power increased electric rates by 8.5 percent, or about $4 for the average customer, each year over the following three years. The BLP said the reason for that increase was because revenues were nearly 18 percent below costs necessary to provide the electric service.

A similar situation was occurring in the utility funds at city hall, officials told The Mining Journal. Apparently, people are using less water these days, meaning less revenue in the utility funds.

According to officials, because of that drop in usage, next year’s utility rates would have required at least a 3 percent hike in order to provide the same service residents are currently receiving.

But officials said the higher 7 percent increase was proposed to set aside reserve funds to pay for future improvements.

Coupled with the rising electric rates, uncertainty surrounding gasoline prices and the countless other expenses most Marquette residents face, it’s unfortunate that we now have to add utility rates to that list of items becoming more costly.

That said, we understand the city’s reasoning that setting aside some money to properly fund infrastructure upgrades is a wise path to take.

As with many communities, the infrastructure in Marquette is aging and needs replacing. Across the state, municipalities received federal grants some years ago to improve or construct facilities, without properly setting their rates afterward to account for the total cost of construction or to fund future maintenance.

The rate increases are expected to generate $736,000 in next year’s budget and while that won’t fix every leaky pipe in the city’s utility system, it’s a good start to putting away a little extra money for a rainy day, or the next deep freeze, like the area saw in winter 2014. With the reserve funding, the city will be able to cover all of, or at least a portion of those unforeseen repairs.

If the city is lucky, and doesn’t need the money for emergency repairs, it can set aside monies for future maintenance and improvements, some of which is currently being paid for through bonds and grants.

Additionally, the reserve fund would allow the city to cut back on borrowing money for infrastructure projects, either freeing up those bonds for other improvements or simply leaving the city with less debt to pay off.

It’s difficult to pay a little extra now, but the reserve funding, if used properly, will put Marquette in a much better place in the future.

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