Months of wet, cool weather and slow population growth are forcing Jefferson County to amend its bankruptcy plan. It's considered a risky move because it will cost sewer users and possibly the bankruptcy exit plan itself.
"We felt it was better to say, 'the assumptions in the original projection didn't appear to be accurate.' And it was better to say, 'we needed to make more adjustments,'" said Commission President David Carrington.
The original revenue projection in the bankruptcy plan filed last month is now being called "optimistic." To make up for the five percent revenue loss, the initial proposed sewer rate increases of approximately seven and a half percent will now be closer to eight. The base charge will rise from ten to fifteen dollars.
"The amended financing plan is the right and honorable way to proceed," said Jefferson County bankruptcy attorney Kenneth Klee.
Commissioner George Bowman doesn't agree. He was once again the lone "no" vote against the amended plan.
"It's being paid for by people on the system right now, the existing ratepayers. We've got to grow the system to make a difference," he said.
There's no promise rates won't increase yet again because the sewer rates are based on sewer revenues and the interest rate secured once the sewer debt is refinanced."There is no more wiggle room. In fact, interest rates have to adjust between now and the confirmation date in order for this plan to work," said Klee.
But Carrington says he's done and any additional money won't come from sewer users.
"Now it will be up to creditors to absorb any interest rate fluctuation, so there are no more rate adjustments I anticipate," he said.
Bowman isn't as confident."I don't know it [sewer rates] won't continue to increase. We're told it's because of lack of consumption. If that continues, rates will continue to climb," said Bowman.
Because the county is changing the bankruptcy plan, creditors do have the option of withdrawing their support. The bankruptcy attorney says it's a risk but adds it's not uncommon for plans to get amended eight even nine times.
The federal bankruptcy judge will still approve or reject the new plan August 6.