City Council approves 5% water rate increase to address operational costs

The Dell Rapids City Council meeting on December 2, 2024, focused on a proposed 5% increase in water rates as part of the 2025 budget. This adjustment aims to address rising operational costs and inflation pressures affecting the city's water services.

City staff highlighted the necessity of small, incremental rate increases to maintain the Water Fund's financial health. Over recent years, water rates have been raised primarily to cover costs associated with State Revolving Fund (SRF) loans for specific projects. However, the current proposal seeks to increase base rates not tied to any projects, ensuring the city can manage ongoing operational expenses effectively.

The recommended changes include raising the base water rate from $12.63 to $13.26 and adjusting the per 1,000-gallon rate from $4.16 to $4.37. For residents using 5,000 gallons, this translates to an increase of approximately $1.68 per month. Additionally, the rate for water pumped and delivered outside city limits will also see a 5% increase, with similar adjustments for higher usage tiers.

City officials emphasized that without these rate increases, the city risks facing budget deficits in the future. The council is expected to vote on the proposed ordinance in the coming weeks, with discussions highlighting the importance of sustainable funding for essential water and sewer operations, including maintenance and leak repairs.