Evergreen Water and Sewer District customers will see their water and sewer rates increase by 5 percent this month.

The higher rates are needed because of general increases in all costs, including supplies, materials, contracted services and labor, according to Jack Fallon, president of the Evergreen Water and Sewer District Board.

Evergreen’s sewer rate is increasing to a $9.92 monthly base rate (up from $9.45) and a $4.85 per 1,000 gallons treatment and collection charge (up from $4.62.

On Monday, the Kalispell City Council increased the rate it charges to treat sewage from Evergreen, which maintains and operates its own sewage collection system.

That’s one component of Evergreen’s sewer rate.

The treatment rate — increased by 19 cents to $1.67 per 1,000 gallons — is reviewed annually and calculated based on operational expenses at Kalispell’s plant and Evergreen’s share of total flows.

Evergreen’s usage of the treatment plant declined by about 7 percent in 2012, but total usage of the plant declined by nearly 14 percent, leaving Evergreen with a bigger share of Kalispell’s operational expenses to pay for.

Evergreen will see a break on its required debt service contribution to Kalispell’s treatment plant.

The contribution is declining from $12,467 to $10,973 a month.

That reduction is possible because Kalispell refinanced its water and sewer debt at significantly lower rates, a move that’s expected to save the city about $2 million on future interest payments.

Evergreen’s water rate is increasing to a $4.20 base charge (up from $4) and a per-1,000-gallon rate that varies from $1.15 to 57.5 cents depending on meter size and amount of usage. The summer water rate is increasing from 83 to 86.5 cents per 1,000 gallons for June, July and August.

Both rate increases took effect on Sept. 1. Evergreen’s sewer rates were last increased in 2010 and water rates were last increased in 2006.

Kalispell and the Evergreen Water and Sewer District continue to work on a new, long-term sewage treatment agreement.

Among other things, the agreement would govern how treatment rates are calculated each year and the amount of treatment plant capacity that’s available to Evergreen.

The existing agreement dates back to the 1990s and expires in 2015.

Reporter Tom Lotshaw may be reached at 758-4483 or by email at tlotshaw@dailyinterlake.com.