Sewer rates will probably be going up, but it could have been a lot worse, according to Washington Mayor Larry Haag.

The City Council heard the first reading of an ordinance that will start raising rates 9.57 percent to pay for $24 million of the combined sewer overflow project.

Sue Hasse with London Witte group said an average family home using 5,000 gallons of water would see its rate per month raise a little over $3 from $32.78 to $35.92.

A second phase of the rate hike would be in 2012, and if needed, that would raise another 20.34 percent to $43.21 for an average home.

But Hasse said the city should review its project before instituting the 2012 rate increase. Haag said after the meeting that with a possible $9 million grant and competitive construction bidding, the total project cost could come down.

“What we are going to do is bid the contract and build the project,” Haag said. “We feel that bids will come in under ($24 million). I feel the contractors will come in with some nice prices.”

The proposed $24 million combined sewer overflow project would build two holding tanks and a constructed wetland near Hawkins Creek. The construction, mandated by the federal Environmental Protection Agency and the state Department of Environmental Management, would solve all future issues with draining untreated sewage into the White River.

That rate hike, Haag said Monday, could have been a lot higher. Original plans were to separate all sewers in the city, at a cost of $63 million over 20 years.

He said the wetland option, to be completed over two years, would save city rate payers money in the long run. Haag quoted a 2007 study that said if the $63 million project were to be bonded at once, rates would raise as high as $70.

“We’re stating that rate could be as high as $43.21 not $70,” Haag said. “What could have been 20 years and continual rate increases, we will finish (in two).”

The city is also looking for a $9 million Community Development Block Grant to help pay for some of the funding. The application is due on May 10. The rest of the funding will come from a bond from the state Revolving Loan Fund.

Haag said after the meeting the grant will go a long way towards keeping rates down.

“We are down to receiving easements, hopefully by mid-week, we will make our application,” Haag said.

The mayor said the green project has become a leader for environmentally sound projects and has been helping the city get construction going.

“We are 20 years ahead of everyone else in the state of Indiana,” Haag said. “The reason the state is behind us is because we are the poster child for them and the entire Midwest.”

There was no word on when the rate increase would take effect and there would be a hearing for the rate hike. The council will vote on the rate increase at its next meeting on March 22.

Before the council meeting, another grant hearing was held on securing grant funds for another wastewater project. The grant, about $1 million, will pay for stormwater improvements in five areas along parts of Viola Avenue, Apraw Road, Hemlock Drive, S.E. 14th and 16th streets and Vincennes Avenue. Parts of the city that flood after major rains.

“It’s the nature of the terrain that we are having some of these problems,” Haag said. The grant application is due April 30.

In other business

DEMOLITION BIDS

The Board of Public Works and Safety awarded bids for demolition of two properties in the city to Rex Gress and Sons.

The company will demolish a house at 2211 Oak Grove Road and a building at 309 N.W. 11th St.

Three other properties up for bid were not awarded. Two of those, on Vine Street, were completed by the owner and the other at 15 W. Pearl St. has asbestos shingles and needs to be rebid.

“We’re getting them one at a time,” Haag said. “We are cleaning them up.”

WASTEWATER WORK

Public Works was asked by the Washington Moose lodge to reduce a $200 bill the city has charged them for contracting work on their sewer system.

The lodge asked for a reduction in half because they host community events, like Shop with A Cop. Board members were then made aware that it is illegal for the council to do that since the charges are in designated through a city ordinance.

“You are making a gift with public money,” Board member John Gray said.

ASPHALT PAVING

Two bids were received for asphalt paving Tri-County Paving, Otwell and Dave O’Mara Contracting, Bloomington. The bids were referred to Public Works who asked Street Department Superintendent Ernie Evans to review and make a recommendation.

CROP LAND LEASE

Only one bidder, Richard, Robert and David Robinson, submitted a bid to farm the city’s 63 acres of land at $102 per acre. Public works awarded the bid to the farmers.

FIRE DEPARTMENT CHANGES

City fire Capt. Rick Mattingly was promoted to battalion chief by Public Works, replacing former chief Dave Chapman, who will retire on March 20.

Firefighter Bobby Norton will replace Mattingly as captain and a new firefighter will be hired.

CENSUS

Haag said city residents have started to receive Census forms and encouraged citizens to fill out the forms and return them to the 2010 Census.

“If you are not counted, we don’t receive Federal dollars,” Haag said. “It is very important to get those filed.”