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Council passes Resolution to base surcharges on water usage

Lennox City Council covered a lot of ground during Monday night’s meeting, including moving forward with their intent for the proposed Ambulance District, tackling water and sewer surcharges and adding an assistant finance officer position.

The City of Lennox has been working on the formation of an Ambulance District since last year. This is allowed under South Dakota State Law 11-34A. During Monday night’s meeting information was presented that included a complete list of properties and a map of the proposed district. The Resolution before the council was basically just to inform Lincoln and Turner counties of the City’s desire to join a Lincoln-Turner Ambulance District should the counties decide to allow an election. The formation of the Ambulance District would be brought to a public vote before actually being formed.

The City of Lennox currently funds the Lennox Area Ambulance, even though the Ambulance coverage extends outside of the municipality. People who use the Ambulance service are billed for the service, but there is always a shortage of funding that is covered by the City of Lennox for the Ambulance’s budget. The shortage can run $30,000 to $90,000 according to the City Administrator. The formation of a Lincoln-Turner Ambulance District would distribute the tax burden among all who use the service, rather than just those within the City of Lennox.

City Administrator Nathan Vander Plaats said the City could choose to reduce the property tax levy for citizens in the municipality by the corresponding Ambulance District tax levy and then those in the city limits would not be double-taxed.

The council voted in favor of Resolution 2022-2-14-03: Resolution of Intent to Join Lincoln-Turner Ambulance District.

Another interesting topic was Resolution 2022-2-14-04: Water and Sewer Surcharges.

Currently the City of Lennox charges flat rate surcharges to pledge revenue against debt service for several projects.

Vander Plaats said that after reviewing neighboring communities, he discovered some communities charge surcharges on a usage basis instead of a flat rate. After following up with Department of Agriculture & Natural Resources (DANR), which administers the state revolving fund (SRF). He learned that DANR requires that the City collect an additional 10% over the principal and interest payment (P&I) amount due for all surcharges.

Finance Officer Denise Hanson provided calculations for the new surcharges based on the P&I due for the current projects and that was what was presented in the Resolution Monday night.

Vander Plaats said, “The overall impact of this change is clearly beneficial to many of our customers, as it reduces the overall cost of water and sewer for users under approximately 4500 gallons per month. Rates will increase for heavy users of the water and sewer systems, including some residential properties.”

This option places the burden of debt service on the heaviest users of the system. Council approved the Resolution. It was noted that the new surcharges would be in affect for the March billing cycle, which would be reflected in the April bill.

It was also noted that the Boynton Avenue surcharges are not yet included in the Resolution, and the Resolution will be updated in July to reflect the new surcharges.

Following an executive session Council approved the creation of an Assistant Finance Officer position and authorization to advertise the new full-time position. The starting wage was listed at $17.30 to $23.00 per hour on the draft job description provided at the meeting.

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