Kingman council approves water rate increases to cover rising costs, including electricity uptick
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Summary
Council adopted ordinance 1979 to increase water base and volume rates and capital renewal fees beginning July 1, after staff cited higher electricity and overtime costs; staff said higher water usage produced additional revenue this year but projected further increases were necessary to maintain 60‑day reserves.
The City Council on May 25 held a public hearing and adopted ordinance 1979 to raise water base rates, volume rates and capital‑renewal fees effective July 1, 2025.
Deputy City Manager Tina Moline presented the updated water rate study, which recommends a 13% increase in fiscal year 2026 (building on a prior FY25 increase of 26.5%) and a multi‑year plan to maintain operating and capital sufficiency and a 60‑day reserve. Staff said unanticipated cost increases — notably roughly $800,000 in electricity expense for water operations and higher overtime related to leak repairs and operations — drove the updated revenue needs. Higher customer usage during a dry year produced additional revenue but staff said it offset unexpected cost growth rather than eliminating the need for rate adjustments.
Moline said the proposed rate adjustments apply to both inside‑city and outside‑city customers for fixed and volume charges, and that capital renewal fees will increase to maintain planned replacement projects (meters, distribution lines, service lines). She noted that the city’s current residential example (5/8‑inch meter, 6,000 gallons) is below the regional average now and remains comparable after the proposed increases.
During the hearing members of the public asked for greater transparency on expenditures; staff explained that the water enterprise covers operational costs, capital needs and that capacity fees charged to developers fund system expansion (they do not pay operating shortfalls). Staff said vacancy and salary‑savings assumptions are built into budgeting projections.
After public comments and discussion, the council approved the ordinance on a voice vote. Moline said the water department will continue to pursue operational efficiencies (including work with the utility provider to address electricity consumption) and will return with ongoing budget and rate reviews.
