Bentonville Utility Board Proposes Updates to Utility Deposits and Fees

In a move reflecting the city's ongoing growth and evolving utility usage patterns, the Bentonville Utility Board will discuss significant updates to utility deposits and fees at their meeting on July 16, 2024. This marks the first major revision since 2018 for deposits and since 2005 for fees, with the goal of better aligning these charges with current costs and service demands.

Addressing Increased Costs and Usage Patterns

The proposal, presented by Gary Wilson from the Utility Billing Department, underscores the need to adjust deposit amounts based on current average charges for each service and class of service. "Our basis for setting the deposits is to ensure the standard level deposit is sufficient to cover one month’s average bill for the service and class of service," Wilson explained in his memorandum to the City Council. With the average electric charge for a residential customer rising from about $100.00 in 2018 to $124.37 now, the standard deposit for residential electric service is proposed to increase from $100 to $150.

Proposed Changes to Deposits

Here are the key changes in the proposed deposit amounts for different services:

• Residential Services:

  • All services (electric, garbage, and water): Increase from $200 to $250 for standard deposits, and from $400 to $500 for higher risk deposits.

  • Electric: Increase from $100 to $150 for standard deposits, and from $200 to $300 for higher risk deposits.

  • Garbage: Increase from $20 to $30 for standard deposits, and from $40 to $60 for higher risk deposits.

• Commercial Services:

  • Small Commercial: Standard deposits remain at $800, but higher risk deposits increase from $1,600 to $2,000.

  • Medium Commercial: Standard deposits increase from $2,900 to $4,000, and higher risk deposits from $5,800 to $8,000.

  • Large Commercial: Standard deposits decrease from $8,750 to $8,000, but higher risk deposits remain the same at $16,000.

New Fees and Adjustments

In addition to deposit changes, the Utility Billing Department is proposing updates to various service fees to better capture actual costs and streamline the fee structure. Key proposed changes include:

• Service Fee: Increase from $15 to $25.

• Same Day Service Fee: Increase from $30 (stacked fees) to $50.

• After-Hours Service Fee: Increase from $45 (stacked fees) to $75.

• Reconnect Fee: Increase from $45 (stacked fees) to $50.

• Reconnect After-Hours Fee: Increase from $60 (stacked fees) to $75.

• Returned Item Fee: Increase from $20 to $30.

• Past Due Notice Fee: New fee of $2.50 to cover the cost of preparing and sending disconnection notices.

Wilson emphasized that the new fee structure is designed to simplify billing for customers and reduce administrative burdens. For example, the same day service fee now combines the standard service fee and the same day request fee into a single charge, making it clearer for customers and easier for staff to process.

Rationale and Impact

The proposed changes are driven by a need to ensure that the city's utility services remain financially sustainable. "It has been six years since the last change to our security deposits and nineteen years since we have updated our fees," Wilson noted. "Both have served us well, but they have not kept up with the costs they are meant to cover."

By updating these deposits and fees, Bentonville aims to mitigate losses from unpaid utility bills and ensure that the city's utility infrastructure can continue to meet the needs of a growing population. The updates also reflect a broader trend of increasing reliance on utilities for everyday activities, including heating and cooling, which have contributed to higher average utility bills.

The proposed changes will be effective starting September 1, 2024, pending approval by the City Council. Residents and business owners are encouraged to review the details of the proposal and provide feedback during the public comment period at the upcoming Utility Board meeting.

Community Feedback and Next Steps

The Bentonville Utility Board meeting on July 16, 2024, will provide a platform for residents and business owners to express their views on the proposed changes. Community feedback will be crucial in shaping the final decision and ensuring that the updates balance the need for financial sustainability with fairness and transparency for utility customers.

As Bentonville continues to grow, these updates to utility deposits and fees represent a proactive approach to managing the city's resources and maintaining high-quality utility services for all residents.