Hard copies of this report are available at the Norwood Town Hall.
Letter to Citizens Regarding New Fiscal Year, Fees and Rate Changes
Hello Fellow Citizens of Norwood,
The Town of Norwood’s fiscal year ends June 30th. This is a time to evaluate where we are financially as a town. It is also a time to implement the plan that guides us into the future.
I am pleased to share with you that all of our departments (water, sewer, police, administration, etc.,) ended within budget. I would like to thank Police Chief James Wilson, Public Works Director Mike Thompson and every employee for their assistance with this, and you as citizens for being good stewards of our community property. Norwoodians should and do take pride in their town and it shows.
While we have made strides in building our reserve funds and pricing our services to responsibly operate and maintain a town, there is a long way to go. The State of North Carolina required that we raise our water and sewer rates several years ago. This systematic price increase makes steps each year in getting closer to the break-even point where we as a town need to be.
Norwood had promised the state to implement these price increases as part of a low/no interest loan to repair our wastewater treatment plant which was in such a state of neglect that we had many sewer spills which can be a health hazard and has cost Norwood dearly in fines over the years.
Though it was not an easy decision, Norwood Town Council made the correct choice to do what was imperative for the Town of Norwood, to keep its promise to the state and to adjust its rates to cover the cost of providing high quality water and a safe, effective sewer system. As promised as a result of the water rate study around 2017, the water rate will increase the 15% that was in place several years ago, in order to cover costs for this necessity.
As an example of this increase, if your water bill is the minimum amount (which will be $25.01) your water bill will increase by only $3.26. The same amount that your sewer rate will increase. Put in perspective, if you are a minimum, base rate customer you receive one gallon of good, tested (our water has stricter quality standards than the bottled water that is priced scores higher in stores), treated, water delivered in your home, with the turn of a knob for 2.5 cents!
Another area where we had to increase our charge for a service is garbage removal. There has been no price adjustment in recent History from the town while our price to provide that service has been naturally rising.
Norwood is charged $10. 52 per residential cart per month and $12.93 per commercial cart to service the garbage removal. While this is a competitive market rate for garbage service, Norwood is only charging $4 per month for residential cart service and $6.25 for commercial cart service. Norwood also provides extensive additional services: limb, leaf, bulk items, and so on add up to an annual Sanitation Budget of $494,900 while our $4 per cart and $6.25 per cart for commercial per month only provide $55,000 in revenue to offset the cost.
Therefore, duty, fiscal responsibility, and common sense dictates the increase in the residential garbage cart fee to $11.00 per month and $14 per cart for residential cart service. Norwood Government budgets the same as all other municipalities in North Carolina, revenue neutral. What this means is that Norwood is not budgeting to make a profit, Norwood is budgeting to cover the costs of providing services, making payments, and meeting its obligations in order that we can continue to serve its citizens.
Norwood government painstakingly reduces every cost we can that leads to more value for you, the citizens. You can do your part to provide maximum value for our tax money. Together we can keep costs low. It takes all of us.
Some things you can do to help keep all of our town taxes, fees, and rates low are to bag your leaves in strong plastic bags. If items are permissible and fit in your garbage cart, place them there. It will reduce a costly trip the town would have to make to remove it should you place them by the road. You can also place bagged leaves in your garbage cart. Again, this reduces the number of costly trips the town would make to remove it.
In my eleven months here, we have made great strides to getting Norwood fiscally sound. We have reduced the amount we have to borrow from our modest cash reserves by 15% compared to last year. I ask you to take pride in the fact that we are growing fiscally stronger. I ask for your help in continuing this winning. We can do it together.
Best Regards,
Scott Howard MBA, ICMA
Town Administrator
Proposed Budget for 2020-2021
The proposed 2020-2021 budget for the Town of Norwood has been presented to the Norwood Town Council and is available for public inspection on the town’s website at www.norwoodgov.com and in the Norwood Town Hall, 212 South Main Street from 9:00 a.m. until 5:00 p.m. each weekday except Wednesdays.
There will be a public hearing on June 15, 2020 at 5:00 p.m. at the Norwood Town Hall for the purpose of discussing the proposed budget. Any persons who wish to be heard on the budget may appear.
The proposed General Fund budget is $2,520,050 and the proposed Enterprise Fund budget is $2,079,800.
For more information, call 704-474-3416.
To view the proposed budget, click here.
To view the Budget Message, click here.
Norwood Farmers Market
The Norwood Farmers Market is open on Saturday’s 8:00am until 12:00pm.
Norwood Town Council hears presentation by NC Rural Water regarding Utility Rate Structure
On Monday night May 7th 2018, The Norwood Board of Commissioners heard a presentation by representatives of the NC Rural Water Association.
Terry Green and Marty Wilson presented their findings following an extensive review of the towns utility operations. The rate study was done at the request of Town Administrator, John Mullis.
Wilson remarked that a Proposed Rate Increase of 62 percent would be required in order for revenue to match expenses including debt service and depreciation. This would move your existing $16.44 rate to $26.63 ($10.19 on the base rate) or a 62% increase. Wilson advised council the town has not raised rates in several years. The recent Berry Hill Sewer project was approved in April 0f 2014 yet no provisions to pay for the additional debt requirement were made at that time. While you will have some debt dropping off from completed projects, the debt service for this project alone requires an annual payment of $163,000 for 20 years. Current State Bond Obligations. In current dollars, that equates to every utility customer paying $8/mo for 20 years to cover the state bond debt obligations for this one project alone. The current rate structure will not support this additional debt and leaves limited borrowing capacity to address other critical infrastructure projects that are greatly needed. This creates the need to pull from fund balance which should be a last resort. Ideally, rates are adjusted to accommodate for the additional debt load at the time the town encumbers itself for the project. In this case, a rate increase in 2014 and even beyond would have softened the need for larger rate increases now.
It is important to note, that as collection and distribution systems evolve, they too become more expensive to construct. As with every water and sewer project, while they typically serve a small percentage of the total users, the entire cost of the project is spread out among all of the rate payers. I want to be careful to not single out this one project but the additional debt service obligation created by this project is driving the immediacy for rate setting action.
Additionally, the town has two(2) critical projects in the works including the O’neal Alley Sewer Lift Station and the Waste Water Treatment Plant. While these projects are in the planning stages, the board should consider preparing for the impacts now. While no one wants to raise rates, You, the board have an obligation to set the rates at a level that will fund water and sewer operations, prepare for unexpected events, fund depreciation, and fund repair and replace projects. All of this, and most importantly, to provide for the public health and safety of your water and sewer customers.
I will warn you now, no matter the rate increase, the public will not be happy. The public expects the water to be there when they turn on the faucet and the waste to be gone when they flush. The process from the intake to the treatment plant and the pipes in the ground is not a concern of theirs. The public just expects it as a given. You and I know the massive responsibility that comes with operating a collections and distribution system yet the public really has limited knowledge of what all is involved to bring them the service and to maintain the infrastructure. Boards will be hesitant to raise rates and especially in an election year, but you have to consider all factors and what is in the best interest of your water and sewer customers. The easiest thing to do is to turn your head and ignore the problems but your savings account will only last so long. You have to set your rates to not only fund current operations but to also put back in a rainy day fund.
The cost of treating water is expensive and the cost of treating sewer is even more. Doing nothing will only impact your customers negatively in the future. One dollar of deferred maintenance today will translate to $4-$5 in the future, so it becomes pretty apparent that the issues you face today should be swiftly dealt with by not kicking the can down the road.
Wilson remarked that Norwood is not alone. Much of America’s infrastructure is Pre World War II as far as age. The pipes in the ground are now having significant and more frequent failure rates, which increases the cost year after year. In fact, Norwood had an above average hit to your Enterprise fund in the recent months during the cold cycle.
In closing, Wilson remarked, “I’m not here to set the rates for Norwood, that is up to the Commissioners”. I know that you will not be able to initiate a 62% rate increase at one time but you do need to work towards a long term plan to get there. I have conducted hundreds of these rate studies including Murphy and Manteo. I appreciate you allowing NC Rural Water in your Chambers tonight and to present our findings to you.
Following the presentation, the board adopted the following rate schedule.
July 1, 2019 – Base Rate moves from $18.91 per 1000 gallons to $21.75 an increase of $2.84 (or 9 cents per day) for inside customers. For sewer customers, the same rate will apply. So the combined increase for water and sewer will be $5.68 (or 19 cents per day).