Rates for Water and Waste Water Systems

Announcer: Farm and Family is a production of the Mississippi State University Extension Service.

Amy Myers: Today, we're talking about rates for water and wastewater systems. Hello, I'm Amy Myers and welcome to Farm and Family. Today, we're speaking with Dr. Jason Barrett, Mississippi State University Assistant Extension Professor, and Patrick Miller, Mississippi State University Extension Instructor. They're both with the Center for Government and Community Development. Jason, what are the water rates based on? What exactly is this?

Jason Barrett: Okay. Well, when we start thinking about drinking water and wastewater production, a lot of our municipalities, if not all, are going to have their own water system and subsequent wastewater systems. From the water system standpoint, each customer will have a meter in their yard, and almost all are registered by thousands of gallons. Some are actually by cubic feet, but most are registered by thousands of gallons. The customer will be charged based on the thousands of gallons that come through the meter, and then their wastewater rate would then be based on those gallons consumed as well.

Because the mindset behind that is the amount of water that comes through the meter is used in the home and then that is discharged also to the system, so that'd be the wastewater. You would have actually two different enterprises, the water system and then the wastewater system.

Amy Myers: Patrick, what exactly starts or generates a specific rate?

Patrick Miller: Well, I think what's important to remember is that your county or municipality who's providing the system is providing a public enterprise. In order to provide that enterprise, they need revenue to do so. The major source of revenue just like, for example, a private enterprise is going to be through their rates. Typically municipalities or counties are going to try to provide that service at a what I would say as a wholesale rate. They do so so that they're able to provide quality employees, be able to maintain the actual water system, wastewater system, account for depreciation.

What's important as a citizen is to recognize that the rates and the rate structures as Dr. Barrett discussed are there to provide that service locally because you don't really see that money coming as a revenue source from state and federal government.

Amy Myers: This is public water systems.

Patrick Miller: Correct.

Amy Myers: Not the same as a well. Let's make sure. We both know that it's not the same as like a well service.

Patrick Miller: Correct.

Amy Myers: Patrick, tell me what some reasons might be if we see a rate increase and how much we are charged for water?

Patrick Miller: Yeah, I think you're seeing a trend in the United States, and especially in Mississippi, where there's a need for an increase in rates to help maintain infrastructure. You're seeing a need for a higher quality of employees. You are seeing an increase in federal regulations that essentially cost money to provide a better quality service. What counties and municipalities are doing and with the help of folks like Dr. Barrett, they're prioritizing where they need improvement in their infrastructure and then taking a look at those rate structures.

Like I said earlier, they are providing them hopefully at a wholesale rate that is at the lowest cost to the hardworking citizens of the county or municipality, but at the same time being able to provide a public service.

Amy Myers: Jason, it seems like the rates to some... Sometimes it might seem like the rates should be the same everywhere, but sometimes they're not. Why are the rates not the same everywhere?

Jason Barrett: Okay. Well, first of all, for each system, water or sewer, there are different classifications. With each of those classifications, you have different forms of treatment, different amounts of infrastructure, different ages of infrastructure, different numbers of employees. You just have so many factors that go into each water and wastewater system. There are essentially no two systems the same, and it's very important that that one water sewer system doesn't try to compare themselves to another system or to an adjacent system just to think that's their reference point because it's not. They truly need to base their rates on their own system and what it takes to function.

Amy Myers: Thank you so much. Today, we've been speaking with Dr. Jason Barrett, Mississippi State University Assistant Extension Professor, also with Patrick Miller, Mississippi State University Extension Instructor. I'm Amy Myers and this has been Farm and Family. Have a great day.

Announcer: Farm and Family is a production of the Mississippi State University Extension Service.