Staff proposes multi‑year water and sewer rate increases; irrigation customers to face higher adjustments

City consultants presented a proposed water and sanitary sewer cost-of-service study and a multi‑year rate plan that would raise utility rates across 2026–2028 to cover operating costs, debt service and capital needs.

Consultant staff summarized recommended rate changes: sewer rates structured as an across‑the‑board 5.7% increase for 2026 and 2027 and a 4.3% increase in 2028 under the proposed scenario. On water, consultants recommended a 6% increase in 2026 (with periodic re-evaluation) and noted the largest single cost driver is the city’s wholesale purchase from Harper Valley (presented as a variable cost in the consultant slides).

The consultants said irrigation customers currently pay less than the estimated cost-of-service and recommended a larger near‑term adjustment for that customer class — the consultant presented scenarios with irrigation increases of roughly 12% in one option and a second option that applies a larger increase in a later year. The consultants explained that irrigation usage is seasonal and can create higher peak demands and that seasonal customers often pay less fixed service charge revenue as currently structured.

Staff emphasized the plan includes a three‑year rate path and a planned reevaluation in year three to verify assumptions about growth, wholesale costs, and fund balances. Board members asked technical questions about drought management, drought-rate options and how wholesale cost changes would be passed through. No formal adoption occurred at the work session; consultants will continue to refine the study and present final ordinance language and rates for future board action.