Little Rock Wastewater will no longer collect connection fees from new customers who hook up to the sewer system that was expanded into previously unserved areas a few years ago, the agency's governing commission voted Wednesday.
In a unanimous vote, the Water Reclamation Commission -- which governs certain finances and operations of the sewer utility -- decided to eliminate the capital recovery fees created in 2001.
The fees were created with a two-year grace period to encourage residents in 29 previously unserved areas to hook up to the newly installed public sewer mains. Little Rock Wastewater took out two loans to build new infrastructure to reach the 29 sites.
It was thought residents would hook up if they were told the fee would be waived for the first two years after the sewer construction. About 89 percent of previously unserved residents in the 29 areas have hooked up since then, and the majority of them did so in the two-year grace period, Chief Operating Officer Howell Anderson said.
Since the fee amount is based on acreage, the financial burden can be high. He said some fees were as high as $20,000.
The fees now "appear to be detrimental to additional connections and the basic intent of the Unsewered Area Program," Anderson wrote in a memorandum to the wastewater commission.
"It was a good thing to do and it's been a success, we just want to get these last 11 percent and we think the best way to do this is through" eliminating the capital recovery fees, Anderson told the commission at a Wednesday meeting. "As much as an incentive as the two-year grace period was, it appears to become a disincentive if you didn't connect in those first two years. So we've seen drastic reduction in people willing to connect after those two years."
The fees weren't necessary to repay the loans taken out to extend the sewer services to the construction areas, the memo said.
Eliminating the fees will not affect sewer rates, the ordinance said.
The ordinance goes into effect Jan. 1.
Wastewater attorney Carolyn Witherspoon said the 29 areas are scattered across the city and include areas near Cantrell, River Ridge, Colonel Glenn, Kanis and Bowman roads.
Metro on 09/17/2015