The City anticipates that the combined costs of proposed water, wastewater and stormwater systems’ capital improvements, anticipated increases in operation and maintenance expenses, and other financial obligations over the next four years will exceed the utilities’ current financial capabilities under existing rates.  To provide an ongoing plan to meet the anticipated financial obligations of the utilities on a sound and equitable customer basis, the City authorized a comprehensive study of revenue requirements, costs of service, and rates for each of the three utilities in 2019.

Staff continues to maintain the rate models resulting from the 2019 study.  Inputs are updated annually and reviewed for accuracy and impact.  Water and stormwater rates requested in 2019 were reduced by 1.5% each before their passage for three (3) years, instead of the requested five (5), with the intent to review and assess the continued necessity.  Subsequent review of the wastewater model revealed significant miscalculations proving the approved rates to be woefully inadequate to maintain system requirements.  Inflationary pressure continues to push costs up and system capital needs have not been relieved in any substantial way.

Staff is recommending the rates as presented which result in an overall blended impact of 9.85% per year.  Based on the current economic environment, this rate increase should allow the Utilities to fund water line replacement at the 150-year replacement cycle level.  Additionally, it will allow the Utilities to expand low income and affordability programs to help those customers most in need in our community.