Temple is now operating on a new fiscal year budget after the City Council was able to agree on a new utility rate structure aimed at making the water and sewer fund self-sufficient within five years.

The city had been operating on its 2009 fiscal year budget for the first month of 2010 while a new rate structure was hammered out. An attempt to approve the budget in January was tabled after the proposed rate structure based on water meter size was lambasted by residential and commercial customers.

The new rates are primarily based on usage, but those rates will increase 5 percent per year over the next five years — an average increase to the base rate of about 63 cents per month for both water and sewer — to make the water and sewer fund self-sufficient to the point that the city’s $600,000 annual bond payment on its sewer plant and any necessary repairs can be funded without dipping into reserves. In the first year, the city has budgeted about $100,000 of the bond payment coming out of reserves with a gradual reduction in that amount each year.

“We’re going to go into reserves a little bit deeper (in the first year) and lessen the burden on customers a little bit more,” Councilwoman Hiley Miller said. “With the new proposal it will be a little bit better for everybody, both residential and commercial.”

Councilman Williams Simmons, who made a proposed rate structure that would have meant higher rates with very little money being taken out of reserves, was the only council member to vote against the new rates.

“The main difference is we’re taking money out of reserves and I disagree with that,” he said.

Under the provisions of the new utility rates, residential customers using up to 2,000 gallons of water per month would see a $2 increase in their rates for both water and sewer. On top of that base rate, usage between 2,001 and 7,000 gallon would increase from $3.85 to $5 per 1,000 gallons on the water side and from $4.85 to $5.25 on the sewer side. Usage between 7,001 and 10,000 gallons would increase from $3.85 per 1,000 gallons to $5.10 for water and $5.35 for sewer. Usage over 10,000 gallons would cost $5.35 per 1,000 gallons for water and $5.60 for sewer.

On the commercial side, those few customers using less than 2,000 gallons would see an increase from $10 to $14 for both water and sewer. In addition to the new base rate, those using between 2,001 and 15,000 customers would pay $5.10 for water and $5.35 for sewer per 1,000 gallons used. From 15,001 to 50,000 commercial customers would pay $5.35 per 1,000 gallons for water and $5.85 for sewer, and usage of more than 50,000 would cost $5.85 per 1,000 gallons used for water and $6.35 for sewer.

Garbage rates will also increase across the board $1.50 per customer, from $10,50 to $12.

The general fund budget approved Monday night by the council is balanced with revenues and expenditures set at $2,023,465, a reduction of about $15,000 from 2009. A budget revision will have to be made in the coming months to rectify any anomalies in the budget due to the fact that the city operated on last year’s budget for the first month of the fiscal year.

“We are going to review the budget every six months as a whole to see if we need to make any more cuts,” City Administrator Kim Pope said. “We’re already looking at several different ways to save money.”

Despite two meetings in which a host of people spoke against the utility rate increases, no one spoke against the measure Monday. However, Temple resident Neil Shelnutt said he believed there were several “luxuries” in the approved budget that could still be cut.

“I’m willing to pay higher water bills because I live in the city, but I think there is more that could be looked at to save the city money,” Shelnutt said.