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Water rates in Mount Airy will rise come the start of the October billing cycle. The only question is, by how much.

The rate increase was a topic of conversation at the Mount Airy Town Council meeting Monday night after the town's Water and Sewer Commission made a recommendation for a rate structure that some council members questioned.

Dick Swanson, secretary of the commission, presented the group's ideas to close a gap in the disparity between the town's water-based operating expenses and revenue.

The commission recommended a progressive rate structure that will make system users pay a flat fee of $11, plus the cost of water used.

"That structure eliminates what the Water and Sewer Commission considers a rather high water rate for the rather low users," Swanson said.

Currently users up to 6,000 gallons per quarter pay a flat rate of $53.15, even if no water is used, as is the case in almost 3 percent of users among the 3,300 hookups.

Under the proposed fee structure, low users would pay an $11 flat fee and $7.35 per 1,000 gallons of water. A top user with 1 million gallons would pay the $11 flat fee and $13.65 per 1,000 gallons.

Swanson said customers, both business and residential, using less than 40,000 gallons per quarter accounted for about 93 percent of the town's users, 83 percent of those using under 20,000 gallons.

To cover the loss of money from reducing fees to low water users, rates on high water users, such as restaurants or nursing homes, increased.

The progressive rate structure is geared to inspire conservation, with the idea that the more water used, the more it costs, the more some want to save.

Councilman Peter Helt argued that the amount of usage is automatically linked to efficiency, which is not always true, as in a house with 10 occupants who may be using little water, but still have more than a house of two occupants who may not be conserving well.

"If they have less people in their house, we assume people are using less," he said.

Helt said a flatter rate would level the playing field, making the same amount paid for a gallon no matter how many gallons the user consumed.

Councilwoman Wendi Peters, a former liaison to the Water and Sewer Commission, said the progressive rate structure has been a topic for years.

"Each year they come in with proposals and each year we send it back with different proposals," Peters said. "We need to decide as a council – do we want to have the flat rates or do we want to have the progressives rates? Once and for all make a decision about how we're going to crack this nut. ... as a council what do we believe is fair share?"

Last year, the council passed a flat fee that went into effect October 2009, along with a 10 percent increase to the then water rate structure. The town's previous plan increased water rates by 10 percent every year through 2014. But that is not enough make the water fund self-sufficient in fiscal 2011.

The Water and Sewer Commission was set to discuss rate and fee options using a progressive rate structure at their Aug. 4 meeting, after The Gazette's deadline. The results will be discussed at the September town council meeting and passed in an emergency ordinance.

E-mail Angie Cochrun at acochrun@gazette.net.