Punta Gorda utility consultants told the City Council at a public workshop that the city needs an immediate revenue increase to fund urgent water and sewer infrastructure projects, offering a recommended plan that phases in a 12% overall revenue increase through 2029 and an alternative that would raise current rates by 5% across the board.

The recommendation came from Danica Katz of Stantec, introduced by Utility Director Tom Spencer. Katz said the study — a periodic rate analysis Stantec has performed for the city since 2005 — found “a 12% overall revenue increase needed through 2029” to keep the system solvent while accounting for growth and large upfront capital needs, notably the Shell Creek reverse-osmosis (RO) expansion and a water treatment rehabilitation project. Katz summarized modeling that shows reserves would be depleted by 2027 with no rate increases and asserted the 12% scenario would restore a three-month operating reserve after the initial years.

The study lays out two primary options for fiscal 2026: the consultant’s recommended approach, which restructures tiers and places more of the burden on volumetric sewer charges, and an alternative that keeps the existing five-tier water structure and applies a uniform 5% increase. Katz described the proposed approach as aiming to “move closer to cost of service,” while the alternative would “just be 5% across the board to your current structure.”

Stantec’s Andrew Burnham and Katz told the council that construction and materials cost escalations since 2020 have dramatically increased the plan’s price tag. Burnham said the five-year capital improvement program that had been projected at roughly $75 million in the prior study has grown to about $197–200 million, and engineers’ updated cost estimates for two major projects came in at roughly $110 million. “Costs have changed dramatically since COVID,” Burnham said, calling the jump “incredible” and noting it has forced the city to accelerate projects that previously could have been phased over more years.

Consultants showed sample bill impacts for residential customers. For a 5,000‑gallon monthly user, the current water-and-sewer portion of the bill was shown as $80.27; under the consultants’ recommended 2026 structure that illustrative bill would be about $91.47 (roughly a $11.20, or 14% increase), and under the 5%-across-the-board alternative it would be about $93.36 (about a 16.3% increase). Stantec also presented benchmarking that placed Punta Gorda’s current water fixed charge near peer averages and its current sewer fixed charge toward the higher end of that sample.

Several residents and council members pressed on distributional impacts. Resident Rick Perry argued that the burden appears to fall disproportionately on year‑round residents and criticized use of comparisons to other metropolitan areas as a justification for the proposed structure. Harvey Goldberg, who said he lives in a multifamily complex, told the council the multifamily sector was “ignored” in parts of the study and that a multifamily sewer base increase he saw in the materials would amount to about a 117% rise; he said that jump would push association fees higher and “is enormously challenging.”

Council members asked follow-up questions about tier consolidation, compounding of multi-year increases, and whether the city can use impact fees and legislative appropriations to reduce rate pressure. Katz and Burnham said impact (capacity) fees are collected from new development and will help but will not cover the full cost; Burnham estimated capacity fees currently bring in roughly $1 million to $1.5 million annually and noted the city’s annual revenue requirement to support the proposed program is on the order of tens of millions of dollars. Kristen Simeon, the city’s finance director, said the updated water supply plan and higher measured system flows contributed to the accelerated schedule for plant expansion and noted staff are pursuing grants and legislative appropriations while continuing to study impact fees.

Utility staff and consultants also reported operational details the council asked about: Tom Spencer and Stantec staff said certified plant meters show peak production on some days at about 9.5 million gallons — levels not expected until later under earlier plans — and that Shell Creek withdrawal restrictions imposed by the Southwest Florida Water Management District (minimum flows and levels) limit how much surface water can be used. Officials said the RO plant design includes space and infrastructure for an expansion but that the timing is driven by the combination of higher measured demand, regulatory withdrawal limits and sharp cost increases.

Council members and residents asked about additional measures: the city’s plan to replace aging customer meters and pursue an advanced metering infrastructure (AMI) program, which staff said will be presented as a study to council the next day; continued pursuit of grants and legislative funding; consideration of bond financing; and conservation measures in development standards. Stantec’s Burnham said the firm is “fine with either structure” and emphasized the core problem is revenue recovery to restore and rebuild infrastructure.

Next steps: staff said AMI and financing options will be presented for council consideration at upcoming meetings and that staff will continue to apply for grants and legislative appropriations; the council indicated it will weigh the consultant recommendation against the 5% alternative before adopting rates or other measures.