Biloxi council wary of utility rate hike for casinos, other large users
BILOXI -- Mayor Andrew "FoFo" Gilich on Tuesday stood by his proposal to raise water and sewer rates for the city's largest users by 54 percent over the next five years, but council members weren't convinced, even after an hour-long discussion.
On the first reading of the ordinance, Councilman Kenny Glavan moved to deny the new rates and Robert Deming III seconded it, but no vote was taken on the denial.
During the workshop before the meeting, Councilman George Lawrence said he thought the proposed utility rate increase should be lowered and the fees for residential garbage collection increased to help pay for much higher landfill costs this year. Residents pay $10 of the $15-per-month cost to the city for garbage removal this year.
The council asked for an adjustment for large apartments and condos that have only one meter. Some are occupied by senior citizens and low-income residents, and council members pointed out they will be charged at the higher prices.
Under Gilich's proposal, water and sewer rates won't go up for the next five years for the 91 percent of customers in the city who use fewer than 8,000 gallons a month.
Casinos, hotels, the hospital and other large users of water would pay 15 percent more the first year, and additional rate hikes each of the next four years. By the end of the five years, the bills for the largest casinos, which pay $100,000 or more a month, would increase by $648,000 a year.
Gilich said the water-rate hike will affect only 1,500 customers. It is for these large users that the city water system requires so many water towers and other equipment to meet peak demand, he said.
New Year's Eve, when the casinos and hotels were full, was a big peak period for water usage, said city attorney Gerald Blessey. "You've got to be able to make that peak happen."
He compared the costs for residents and businesses with other cities in South Mississippi and said in Biloxi, even with the proposed increase, "the rates are the lowest and the taxes are the lowest by a significant margin."
The law requires the expenses of the public utility fund to be covered by customer fees, Blessey said. Biloxi has subsidized the fund for years, and he said this year Biloxi will contribute $500,000 from its general fund -- more than $1 million if the debt service the city pays for the Harrison County Utility Authority is included.
"Even at these rates," he said of the increased fees, "it will take three years to catch up."
In other action Tuesday, the council voted Deming as president and Dixie Newman as vice president; approved short-term rentals in parts of the city; extended its participation in the Motor Vehicle for Hire commission for 30 days and gave a five-year, 50 percent tax incentive to Biloxi Lodging LLC for the former Casino Magic property.
This story was originally published January 5, 2016 at 10:38 PM with the headline "Biloxi council wary of utility rate hike for casinos, other large users ."