NRV water rates expected to double

By  | 

RADFORD, Va. (WDBJ7) Water isn't cheap; Local governments in the New River Valley are finding that out. They're eventually going to have to pay twice as much for the water they provide to their citizens.

Projects with the NRV Regional Water Authority are going to cost much more than expected. The first study into the projects was done in 2012.

However, to get the projects designed and construction going, the Virginia Department of Health required a more detailed study. In that study, a few issues were found that are causing the price-tag to skyrocket.

Four years ago two projects were designed aiming to create new water lines leading into Blacksburg and Christiansburg, following along Prices Fork Road and Plum Creek, respectively. However, the most recent studies show those projects will cost more than $7 million than originally expected.

"Part of that is due to a change in the project in terms of where the line runs and what's needed in order to convey the water," NRVRWA Executive Director Caleb Taylor said.

Renovations are needed for the water treatment plant, which is still using technology from the 1950s and '70s, when is was last renovated.

"All of the water that gets treated goes through the plant and goes out into the system, so this is the heart of of the system and this is where it all starts," Taylor said.

The plant upgrades will cost $27.5 million.

Bond issues are needed to fund these projects. To pay for the bonds over time means rate increases for the wholesale customers of Blacksburg, Christiansburg, Montgomery County and Virginia Tech.

Right now, the four groups spend $2.22 per 5,000 gallons of water. By 2025, it's projected to cost $4.35 for the same amount, nearly doubling the cost.

"We're totally funded through that rate, and that rate only," Taylor said.

But how the mandatory rate increase will go is up for debate. It could be small some years with a couple huge jumps, or it could be larger rate increases every year. Local governing bodies will meet again in November to try to decide which to go with.

"We work with a financial adviser as well as our engineers, who work in conjunction, and look at what is best in terms of providing the lowest interest rate and loan period for us to be able to fund the project," Taylor said.

Taylor could not say whether or not rate increases would mean everyday water users will have to pay more as well.

The governing bodies will have to decide among themselves what to do to cover the extra costs they'll be paying to bring the water in.

To see the PDF presentation Taylor showed to the Blacksburg and Christiansburg Town Councils and Montgomery County Board of Supervisors click the NRVRWA PPT Joint Meeting document attached to this article.

Related Documents