EUREKA SPRINGS -- The City Council is making the best of a bad situation as it juggles its options to increase the city's water rates for the first time in half a decade.

  In back-to-back emergency meetings Friday morning, council discussed proposed Ordinances 2080 and 2081, one of which will raise the water rate, the other the sewer.

What are the options?

  Council had several options on the table for dealing with the financial shortfall that has left the city out of compliance with the bonding company which funded the building of the new sewer water plant.

  One option is to alter the water/sewer payment tiering system.

  At present, the cost for the first 2,000 gallons of water used is $8.36. For the next 8,000 gallons, the cost is $3.06 per thousand gallons. Above 10,000 gallons, the cost is $4.18 per thousand.

Tiers of a town

  At the request of Alderman Rae Hahn, Eureka Springs Water Department Office Manager Amy Williams brought council a series of alternative options with breakdowns on the rates for residential, small lodging facilities and large lodging facilities, if council decided to change the tier structure so the minimum break was at 1,000 gallons, then at 6,000 and finally 7,000 and above.

  The consensus was shifting the cut-off downward would place an undue financial burden on the people at the lower end of the economic spectrum, rather than large-volume users.

  Bill Earngey took the microphone to expand on that point.

Volume, volume, volume

  Earngey said council was dwelling on percentages, but the real issue in water use is volume.

  "If you have larger volume [users]," Earngey said, "you need a larger plant; if you have a larger plant, you have larger maintenance costs."

  Earngey encouraged "a workable system that acknowledges [that] large volume users cost [residents] money," and that bills its users accordingly.

Water Department encourages nine percent hike

  Williams recommended leaving the billing tier system unchanged and raising water rates nine percent across the board.

  A nine percent hike is the minimum necessary to satisfy the bond holders that the city is attempting to correct its financial problems.

  "It just makes sense to do a straight nine percent raise," Williams said, pointing out doing so would have a less severe financial impact on residents than changing the tier system would.

Good deal for irrigators

  Although the city charges separate parallel fees for water and sewage, Williams pointed out those using water for irrigation do not pay the sewage fee. She said there are 196 active irrigation meters in the city currently.

  Williams' suggestions for raising revenue beyond water hikes or tier changes included instituting a non-refundable deposit for new accounts.

  She also suggested revisiting tap fees.

  A tap fee is charged when the city taps into the water line for either water or sewer.

  Williams said the standard tap fee in neighboring cities is $500, while Eureka's remains at $300.

  Asked by Alderman Kathy Harrison how much the city's income would be increased by raising the water rate by nine percent, Finance Director Yvonne Kline said the city's coffers would grow by an additional $82,434 with a nine percent water hike, based on projections from 2007 numbers.

The 'little people' speak

  Mayor Dani Joy read an e-mail sent her by Historic District Chair Melissa Greene.

  "The little people in Eureka already understand that past mismanagement, misspending and misappropriations are the cause of this increase," Greene said. "To jeopardize their livelihoods by the histrionics at this table is just another insult. Because of the situation we've been brought to, I support this increase. Please do it now and don't put it off."

Decision deferred until workshop

  In need of further information from Williams, including a breakdown on how a flat fee of $5 per 1,000 gallons for water, and $7 per 1,000 for sewer, would affect residents and businesses alike, council decided to hold a workshop at 5 p.m. before the next meeting on May 12.

  Alderman Joyce Zeller asked Joy whether putting off the decision until the next meeting would cause problems with the bonding company.

Eureka Springs, unstable?

  City Attorney Tim Weaver replied, "Since you've missed this billing cycle anyway, it probably doesn't change anything, as long as you do get it done by the next billing cycle. But the bonding company is not going to like any delay anymore. The longer it goes, the more unstable they're going to think we are."