&bsp;Even though drought conditions have improved dramatically, the town is forecasting usage, and therefore revenue, to remain low in the upcoming fiscal year.

Before the droughts, the town used to produce about 800,000 to 900,000 gallons of water per day. Tryon now produces about 400,000 to 500,000 gallons a day.

Part of the reduction, possibly about 150,000 gallons a month or more, came from lowering the town&squo;s &dquo;unaccounted for water&dquo; by fixing water leaks. The town also lost big water customers, Dixie Yarns several years ago and most recently Grover Industries.

Grover was using more than 300,000 gallons a month right before it closed last fall, and used more than double that years ago when it was running at higher capacity.

Still, most of the reduction in water usage can be traced to the conservation efforts of the rest of the town&squo;s approximately 2,000 customers.

&dquo;Conserving water is not a bad thing, but on the financial end it&squo;s a real bad thing,&dquo; said interim manager Hembree. &dquo;We&squo;re not seeing the water usage we projected at the start of the budget year. Folks are still conserving water.&dquo;

Some costs, such as those for chemicals, decline when water usage declines. But Hembree and Tryon Public Works manager Joel Burrell note that there are many fixed costs, including expenses associated with a major rehabilitation of the Tryon water plant recently begun by the town.

The town raised water rates in recent years, in large part to pay for the $3 million rehabilitation project that will upgrade the outdated plant and allow it to use water from the town&squo;s former mountain source.

But Hembree says much of the revenue projected from the rate increases has been lost because of decreased consumption.

Town officials acknowledge that the town&squo;s new water rate structure may have contribued to decreased consumption. Last year the town lowered the volume of water covered under the base rate from 2,400 gallons per month to 1,000 gallons per month. So customers now begin facing additional charges above the base rate when they exceed 1,000 gallons.

At the budget workshop Tuesday, town officials said Tryon may need to consider changing the water rate structure to encourage a return to previous usage levels. They quickly added, though, that the town would have to be prepared to change the structure again if drought conditions return.

The workshop on Tuesday focused on the revenue side of the town&squo;s budget. Town council plans to hold another workshop soon to examine the expenditure side. Hembree then plans to produce a proposed budget for town council to consider.