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Court OKs 1.5% hike in sewer rates for sanitation district

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By Thomas Barr

 SHEPHERDSVILLE - Something is better than nothing. That is the philosophy being taken by Jerry Kennedy, manager of the Bullitt County Sanitation District.

Instead of receiving the 3 percent user fee increase he sought, Bullitt Fiscal Court opted to allow the district to hike its current rates by 1.5 percent for one year.

The decision marks the end of three months of discussion, which still has issues left unresolved.

"It beats a zero," Kennedy said in thanking fiscal court for its blessing for a user fee increase.

The original proposal was to add 25 cents per 1,000 gallons of water usage over the minimum 2,000 gallon bill.

The minimum bill would be $14 for 2,000 gallons, which Kennedy said would affect 800 customers. The rest would have seen an increase from $4.35 to $4.60 per 1,000 gallons of usage.

In looking at the recent audit conducted, magistrate Ruthie Ashbaugh was concerned that the district's budget was exceeded in many line items. For example, she said salaries were almost $20,000 over budget and legal fees were $114,000, which was budgeted for $75,000.

Magistrate Dan Kelty also mentioned that $7,600 was spent on phones and $5,700 for shop tools, neither of which were budgeted.

Kennedy said that the audit report is not the budget and the expenses are grouped differently. He added the legal fees were not only for the attorney, but also for things like accounting.

Ashbaugh said the people of the north end, which is the primary service area at this time, have to tighten their belts and she felt the district should look at its expenses.

Even before that discussion started, county attorney Monica Robinson wanted to clarify several points made in a letter she received Tuesday morning from the sanitation district.

She said fiscal court never told the sanitation district that it should impose a tax, although it is allowed by law.

The sanitation district, formed in 1997, can seek fiscal court approval for user increases but it can tax, sell bonds and create a sinking fund on its own.

Robinson cited a 1994 attorney general's opinion sought by then-county attorney Walter Sholar that the district could not be formed without having the taxing authority.

Kennedy, however, said the window to impose such taxes closed after a three-year period.

Robinson had not had an opportunity to research that claim.

The purpose of fiscal court was to operate only on user fees, said Kennedy.

"It was never the intent for us to tax," said Kennedy.

If a tax was imposed, it would cover over 17,000 parcels of property, said Kennedy. The sanitation district would tax anyone not currently in a sewer service territory, regardless of whether sewers were available or would ever be available.

He said the tax issue was never considered until Robinson offered the various options and County Judge Melanie Roberts recommended the sanitation board go back and look at the tax option.

Over the past seven years, Kennedy said no rates have been increased but the expenses, including unfunded mandates from state and federal authorities, have gone up and the equipment is getting older.

Larry Hatfield, a member of the Shepherdsville City Council, offered another option.

He felt there might be some possibility of the city talking with the sanitation district to have sewage sent down to Shepherdsville's new plant for treatment.

Having extensive experience in the sewer system, Hatfield knows that Kennedy's aging equipment gets expensive to maintain. He also knows that unexpected repairs are also possible.

Kennedy agreed that the discussions had merit; however, any resolution might take a year to 18 months.

"It does merit investigation," said Kennedy. "It does not solve my immediate needs."

He said there are bills that must be paid and mandates which must be met. Belt-tightening had already been planned but there are projects that must be done.

Some projects could be delayed.

But when a plant has a major mishap, which happened recently at the Bullitt Hills facility, Kennedy said there is no money set aside for emergencies.

"We just don't generate the revenue we need," said Kennedy.

A major reason has been the lack of any growth over the past few years, which dried up connection fee money.

After a recess, Ashbaugh came back with a compromise to allow a 1.5 percent user fee increase for a one-year period. The court would then revisit the issue at that time.

Kennedy said he would pass along the court's action to Louisville Water Co., which bills and collects funds for the district.