The Albert Lea City Council approved 2012 sewer and water rate structure on Thursday. The rates are part of the city’s goal to fall in line with a state mandate that rewards conservation, rather than rewards use.

However, after some debate, it decided to hold off on increases in rates for the top users — some of Albert Lea’s largest employers — to seek other options and garner time for more feedback.

The plan would have proposed a 30 percent increase in the water rate structure for large users, which means the five largest users would have seen increases in water rates of ranging from 7 to 24 percent.

“I don’t see what we have to lose by waiting another two weeks,” said Councilor Larry Baker.

Albert Lea has what is called a “declining block” structure, which means rates go down the more a user uses. However, a Minnesota statute passed in 2008 requires a conservation structure.

An “increasing block” structure, like Owatonna has, would charge more for more use.

In 2009, the city hired a firm to perform a study and recommend a new structure for sewer and water rates. That structure was approved in January 2010.

The average homeowner, according to the city, uses 2,100 cubic feet every three months. That means the monthly water and sewer bill would be $15.49 for water and $28.95 for sewer, adding up to $44.44.

Under the new rates approved Thursday, that homeowner would pay $15.69 for water and $28.95 for sewer, for a bill of $44.64.

The increase is 20 cents, less than 1 percent.

Average commercial users will see a 2 to 3 percent increase in water rates and no increase in sewer rates.

City Engineer Steve Jahnke said he spoke with officials from some of the largest users and said they either were fine with the new rates or wanted the city to find consistency year to year.

The issue has been in the forefront since 2008, when the city cut sewer rates for its top users by 25 percent following a disagreement between a former city manager and the economic development leader amid complaints about the rates for Mrs. Gerry’s Kitchen Inc., one of several food processors that call Albert Lea home.

Mayor Vern Rasmussen on Thursday noted that Albert Lea has a large wastewater treatment plant because it was built to handle the waste from a slaughterhouse. When that slaughterhouse burned down in 2001 and closed, the cost of running the plant remained the same.

Councilor Ellen Kehr said it is key for Albert Lea to keep the food processors it has because it helps offset the cost of the plant. And she said the plant with its available capacity is a good economic tool to attract new industry.

“That’s why we have the plant we have,” she said.

Jahnke said the increases also reflect the need to build up reserves to pay for expected water and sewer projects, such as the downtown, the Stables area, St. John’s Lutheran Home expansion, 12th and 13th streets and the central water tower.

Councilor John Schulte V proposed a 5 percent increase on industrial users, with the rest of the costs spread over commerical and residential users. His plan was voted down, with other councilors noting the planning and decisions that had led up to the existing plan. However, they noted in the coming two weeks his ideas can get further review.

See more about the rates in the Sunday issue of the Tribune.