October 22, 2018

State budget includes water and sewer reimbursement for Standish

Funds expected to allow city to lower rates


LANSING — The state of Michigan’s fiscal year 2018 budget includes $1.7 million in water and sewer revenue reimbursements for the city of Standish due to the closure of the Standish Maximum Correctional Facility in 2009.

State Sen. Jim Stamas, R-Midland, announced the budget item in a press release July 17. He said he hoped the city would be able to take another look at its recent water rate hike.

“The state closed the Standish prison back in 2009 as part of an effort to reduce costs, and we owe it to the local community to help them adjust to the loss of such a large part of their water and sewer revenue,” he said in a press release. “My hope is that the city will re-evaluate the water rate increase and take into consideration the long-term asset management of the water system.”

City Manager Jerry Nelson said the monies would go toward debt accumulated by the city order to accommodate the prison.

“As part of our agreement, if they ever closed the prison, we wanted to be compensated for it if they left,” he said.

Nelson said he and Stamas begun discussing the possible reimbursement in 2016, communicating monthly on the issue. Nelson said when State Rep. Jason Wentworth took office this year, the two had similar discussions. As a result, the reimbursement was included in the budget for next year, Nelson said.

“They got it in as part of the budget,” he said. “They fought for us. They argued for us. They came through for us.”

“I want to thank Representative Jason Wentworth, Standish City Manager Jerry Nelson, Mayor Ray Koroleski and former Mayor Mark Winslow for their commitment to finding a way to help offset the cost to the city residents of the prison closure,” Stamas said in the press release. “I look forward to working with local officials on a long-term asset management plan that provides vital water services to Standish families in a manner that is affordable and sustainable.”

The water and sewer debt would be reduced from about $2.4 million to approximately $600,000, Nelson said. He said this would be good news for city residents, whose rates for the services were increased in June.

“What we’re going to do now is bring back Mike Engel from the Michigan Rural Water Association,” he said. “He will take into account that debt repayment and rates will be adjusted back down.”

Water rates in the July 1 billing period for city residents were $19.95 for the monthly ready-to-serve fee and $8.25 per 1,000 gallons used, per a motion passed in April by the Standish City Council. Previously, the monthly fee was $10.67 and the usage rate was $7.15 per 1,000 gallons.

Using 2010 census figures and numbers from the city, the increase was expected to cost the average city household $11.42 per month and about $137 annually.

Rates were increased after a study performed by Engel, which was done to see how much the city would have to charge for water to satisfy Michigan Department of Environmental Quality requirements that municipalities be more upfront with water system costs and asset management.


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