Athens will start its next budget year with a $1.2 million surplus, a fact Mayor Ronnie Marks proud to announce.

However, the fiscal 2015 budgets will also include previously built-in rate increases for water, sewer and garbage services.

The average residential water and wastewater customer will pay an average of 2.5 percent more per month in fiscal 2015, which runs from Oct. 1, 2014, to Sept. 30, 2015, according to Water and Wastewater Manager John Stockton. That works out to a total of about 75 cents more per month for the average residential water and wastewater customer, he said.

In addition, garbage pickup will increase about 2.5 percent, the mayor said. Even with the built-in increase, the general fund is still subsidizing garbage pickup for residents.

City Council members reviewed and unanimously approved the $26.2 million fiscal 2015 general fund budget Friday morning. The budget includes $750,000 set aside for capital improvements to be announced, Marks said.

The general fund budget does not include a cost of living increase for employees, though the mayor said the council could take a look at that midyear 2015, depending on the city’s revenue. Athens Utilities’ budget does include a 3 percent cost-of-living increase for employees but it would have to be approved by the council before it could be enacted, the mayor said. In addition to unanimously approving the general fund budget, council members also unanimously approved fiscal year budgets for special revenue, landfill and special school fund budget.

Disagreement

Council members did not vote unanimously on the fiscal 2015 water and wastewater budgets Friday, which include built-in annual rate increases of an average of 2.5 percent.

Council President Jimmy Gill and council members Chris Seibert and Joseph Cannon voted in favor of the budgets that include that automatic increase. (These automatic increases were enacted in 1998 and 2001 or 2002.) Council members Harold Wales and Wayne Harper voted against the budgets because of the automatic increases.

Wales was adamant that the council should try to gradually phase out the automatic increases, say at 1 percent a year. After some discussion, Councilman Chris Seibert said, “It’s great to be a champion of the people but we have this (debt) in front of us.”

Both Wales and Gill were on the council when all of the current wastewater and water debt was acquired over the past 12 years, Water and Wastewater Manager John Stockton said after the meeting.

Marks agreed phasing out the increases gradually is a good idea, but he said council members opposed to the automatic increase never asked him to provide budget estimates showing how it could be phased out, even though the matter was discussed two weeks ago for a couple of hours. Marks said the council already approved the wastewater projects that require the automatic increase remain in place.

One of the projects includes running an additional water line at Canebrake subdivision to ensure fire protection. Canebrake has only one water line. If a main were to break or malfunction and a fire broke out, homes would likely be lost because they are built close together, Fire Chief Tony Kirk has said.

Also, City Clerk Annette Barnes told council members the automatic rate increases were enacted to pay off revenue bonds for work that has been completed. She said the city must maintain a stable funding source for the debt or face mandated rate increases higher than those currently built-in.