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Consultant urges Severance to plan now for water financing, alternatives after NISP approval
Summary
WestWater Research presented a briefing on water markets and proposed a water supply/master-plan engagement for Severance. Consultant said Northern Colorado water prices are shaped by municipal demand and that Severance is comparatively well-positioned but should plan financing for future purchases.
WestWater Research told Severance Town Council on March 25 that population-driven demand and municipal dedication rules have pushed water values in Northern Colorado up and urged the town to adopt a water-supply master plan and financing strategy now that the Northern Integrated Supply Project (NISP) has reached settlement.
Why it matters: Water is the key constraint on growth along Colorado’s Front Range. The consultant said municipal buyers and developers now account for the bulk of purchases and that utility rules requiring new growth to “pay its own way” increase the market price of water. For small towns, the consultant said, orderly planning and financing are crucial to secure supply without saddling existing ratepayers.
Presentation highlights: Adam Jokers of WestWater Research, a Fort Collins-based water-economics firm, summarized transaction data from the WestWater database and said the Colorado-Big-Thompson (CBT) system has been central to growth but is becoming scarcer. He said his firm’s data show that most water sold in recent years was reallocated from agriculture to municipal buyers and that some CBT units likely will remain off-market for decades.
"Water representing about 10% of the overall home cost," Jokers said while illustrating how an embedded water cost can translate into hundreds of dollars in monthly mortgage expense when builders and utilities allocate a per-lot water charge into home prices.
Proposal for a master plan: Jokers said WestWater has proposed to the town manager a public-facing water-supply master plan and financing analysis to inventory supply alternatives (including NISP entitlement, CBT, groundwater projects and traded water shares), complete demand analysis, and develop bond and rate models to support purchases. "We proposed a public-facing document that would explain and provide the justification for whatever decision would have [to be made]," Jokers told council.
Where Severance stands: Town officials and the consultant said Severance’s portfolio is comparatively healthy: the town can provide full service at lower CBT quotas (60% or 50% quota) than some neighbors, and per-home water charges looked competitive in a February data snapshot. Jokers and councilors noted that neighbors’ rate increases timed at different dates may change those comparisons when utilities update tariffs.
Council reaction and next steps: Council members recognized the town’s relatively strong supply position but agreed that planning was timely. Town Manager Nick Wharton and staff said they will meet further with WestWater to define scope and deliverables for a master plan and finance analysis. No formal procurement or contract award occurred during the meeting; the discussion ended with council expressing support for pursuing a structured plan.
Ending: Councilors said they want the master plan to be publicly understandable, to consider affordability, and to map financing options that could be phased so debt service does not unduly burden existing customers.
