Utility fund lost $3.8m last year

Published 12:58 pm Wednesday, September 27, 2017

By Ryan Kushner

Staff writer

Isle of Wight County’s Utility Fund suffered a $3.8 million loss in fiscal year 2017, according to a recent auditing report.

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The fund’s $5.2 million in revenue didn’t come close to offsetting the $9.1 million in expenses incurred over the last fiscal year, part of which includes payments for the county’s somewhat infamous 40-year Norfolk water deal with the Western Tidewater Water Authority.

The county’s utility division is currently subsidized by the county’s general fund, according to Director of Utility Services Don Jennings. 

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The county budgeted $5.2 million in its general fund in anticipation of subsidizing its utilities, according to Assistant County Administrator Don Robertson, so the $3.8 million loss is less than the county had originally expected. 

The amount of money being transferred to the utility fund has been going down for the past several years, according to Robertson.

“So we’re making progress,” he said.

County Administrator Randy Keaton estimated at a Board meeting this past week that the county would need 4,800 new water customers in order for the utility fund to break even.

Part of the $9.1 million in expenses includes payments for the county’s Norfolk water deal, the amount of which increases incrementally each year, according to Jennings.

The water rate for county water customers has increased accordingly over the past few years, with the county estimating a roughly 9.5 percent increase each year for the foreseeable future.

This past July, the water rate climbed only 5 percent because the county had installed new, more accurate water meters that determined many water customers were using more water than previously documented.

Newport District Supervisor William McCarty asked at the Board meeting Thursday, Sept. 21, for staff to construct a timeline for what it would look like to finally get the utility fund to be revenue-neutral.

“In years, what does that look like,” asked McCarty. “Will I still be alive?”

McCarty noted that his water bill has been in the hundreds at times.

Smithfield District Supervisor Dick Grice stressed that the only way to level the fund was to increase water consumption in the county.

“It’s just too big a number to ignore,” Grice said of the $3.8 million loss.

The county is currently in the midst of plans to add an additional water line along Route 10. The slated water line is mainly planned to be available as a backup should the county’s Route 17 waterline ever rupture, according to Jennings, but could also be a resource for gathering additional water customers for the county.

The county’s audit report will be finalized in November, according to Director of Finance Wendy Hu.