The City of McCleary has received a final draft of a rate study for utilities.

In September 2016, city leadership was provided with a draft rate study that included staggering proposed rate increases. The city cautioned that those increases were only suggested and that the city could move forward with less-abrupt rate hikes.

The rate study was suggested by the State Auditor’s office after the city received a finding. The study was prepared by FCS Group. It looked at future costs for operation and creates a plan for improvements.

In the final draft of the study, the rate hikes were altered slightly to reflect the city’s ambitions.

For light and power, the proposed rate increase would have been a hike of 20 percent in 2017, 15 percent in 2018 and 2.5 percent each year through 2021. Those hikes would have raised rates from $95.85 per month (a sample residential monthly bill of 1,200 kWh was used) to more than $142.

The final draft reflects the city’s reluctance to raise rates in December. Late last year, the council approved a 3 percent rate hike for light and power. The remaining proposed hikes in the final study are 15 percent in 2018 and again in 2019, and 2.5 percent in 2020 and again in 2021. The sample monthly bill went from $95.85 to $147.93.

The water fund’s proposed increases were 5 percent each year through 2022, increasing the sample monthly bill from $69.69 to $93.75 by 2022.

Late last year, the council approved a rate increase of 3 percent. The final draft of the rate study reflects that increase and proposes 5 percent increases for the remaining years through 2022. The sample bill will increase to $91.97 if those proposed hikes are followed.

The sewer fund’s proposed increases were 15 percent in 2017, 7 percent in 2018, 2.5 percent in 2019, 2.5 percent in 2020, 1 percent in 2021 and again in 2022. The sample monthly bill would increase to $108.54 from $82.30.

Late last year, the council approved a rate increase of 3 percent for the sewer fund. The final draft of the rate study proposes increases of 15 percent in 2018, 2.5 percent in 2019 and again in 2020, and 1 percent in 2021 and again in 2022. The sample monthly bill would increase to 104.48.

The rate study also suggested minimum fund balances for each fund. Light and power had a proposed minimum balance of $1 million for 90 days of operation, water had a proposed minimum balance of $100,000, also for 90 days of operation, and sewer had a minimum balance of $250,000 for 60 days.

The suggested rate increases were calculated to meet those benchmarks.

During the April 26 city council meeting, Mayor Brent Schiller again cautioned the public that the rate hikes were only suggestions.

“Remember — it’s recommendations,” Schiller said. “We can use this as a guide to help us make our decisions with our utilities plan in the future.”