Moline budget session details utility fee increases and $120M–$132M South Slope project financing

City staff told the council Wednesday that planned, incremental utility fee increases would balance four enterprise funds and fund major capital projects, including the South Slope wastewater plant upgrades tied to an Illinois Environmental Protection Agency (IEPA) loan. At an informational budget work session, Miss Barnes (staff presenter) and utilities staff said the proposed fee plan is intended to fund operations, maintain minimum cash reserves and cover required capital and debt service. Staff said the IEPA State Revolving Fund (SRF) had allocated $120 million for portions of the wastewater program and later gave an “all‑in” construction, design and engineering estimate of about $132.8 million for the South Slope project. To meet cash‑flow and loan requirements, staff recommended a 6% increase in sewer rates for 2026 through 2028, followed by graduated increases in later years (staff cited 5% in later multi‑year blocks). For the water fund staff recommended a smaller increase; the presentation showed a proposed water unit rate of $5.34 per 1,000 gallons for 2026 and a typical household water bill moving from $34.01 to about $34.70 per month under the proposal. Stormwater rates were presented at a recommended 2% annual increase for 2026–2028, and sanitation was proposed to rise 2% per year over the same period. Staff computed the combined immediate effect on a medium residential customer as roughly $3.63 more per month in 2026 (about $43.56 per year) across the four enterprise funds: wastewater (WPC) $2.58/month, water $0.69, stormwater $0.13 and sanitation $0.23. Staff said those user‑fee increases would be sufficient to maintain policy cash‑reserve targets (25–30% operating costs) and to meet debt service obligations tied to the SRF loan. Staff also described the city’s lead service‑line replacement program, noting a separate resolution on the council agenda to authorize a notice of intent to award a lead‑line replacement bid (discussed later in the meeting). The staff presentation included other details: the North Slope phosphorus removal project scheduled to be awarded to Leander Construction pending council approval, smoke‑testing and capacity work at Coal Creek Pump Station, and planned capital equipment purchases for multiple funds. Miss Barnes and utility staff said planned ordinances implementing the fee changes would be presented for first reading on Sept. 23, giving staff approximately 60 days to update billing software and other systems before an intended Jan. 1, 2026, effective date if council adopts the rates. Council members praised the multi‑year planning and asked questions about timing, loan covenants and whether fee steps could be adjusted in the future if growth or revenues changed. Staff said they will revisit surcharge options, lead‑line reimbursement projections and related cash flows as projects and grant awards become clearer.