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Consultant warns Superior may need wastewater and stormwater rate increases; recommends organizational changes
Summary
A consultant review of the city’s Environmental Services Division found aging wastewater infrastructure, depleted reserves and regulatory pressures; the report recommended organizational restructuring, implementation of preventive maintenance, and projected multi-year rate increases under two scenarios.
A consultant hired to review Superior’s Environmental Services Division (ESD) told the Common Council that the utility faces significant capital and regulatory pressures that make future rate increases likely.
Kurt Soderberg, who led the review, said the utility is “fundamentally sound” and staff have secured grant funding, but the wastewater plant has aging equipment and the ESD’s reserve fund has been depleted by recent short-term capital spending. “I see no way…that rate increases in the future can be avoided,” Soderberg told the council.
Why it matters: The ESD provides wastewater and stormwater services citywide. The consultant identified permit-driven work, near-term capital projects and maintenance backlogs that will require funding over the next five years. Councilors were presented with two rate-path scenarios to cover a multi-year capital and operating program.
Key findings: Soderberg recommended reorganizing the ESD into a clearer director-led structure with three divisions (operations and maintenance, technical services, and administration), stronger supervisory authority, and improved reporting to the mayor and council. He urged faster implementation of Maximo preventive-maintenance software, reconsideration of long-term contracted services, and better finance-staff linkage to ESD operations.
Rate scenarios presented: Staff-provided numbers in the consultant’s handout showed two approaches to generate necessary revenue for 2013–2017: - Variable-rate-only approach: collects required funds entirely through the volumetric charge; an illustrative first-year variable increase was shown at roughly 32% (yielding about a 23.6% revenue increase when base rate not changed) with additional increases in subsequent years. - Fixed-plus-variable approach: raises the fixed monthly charge to $12.20 and increases the volumetric rate to $6.62; under this scenario the fixed-rate increase would generate approximately $700,000 annually to cover short-term capital needs, with smaller variable increases later.
Other points: The consultant noted the city’s next five-year permit remains under EPA review and could impose additional requirements. He also recommended using stormwater revenues primarily for compliance capital projects and warned against reducing overall stormwater funding because some ESD positions are already supported by that revenue.
Council response and next steps: Councilors asked clarifying questions about the cost drivers, the effect of non-city customers (e.g., Parkland) and the timeline of potential increases. Staff and the consultant said more detailed modeling and public outreach would be needed before any rate ordinance was adopted.
Ending: The council received the report and requested follow-up analyses and recommendations for organizational changes, a clearer capital plan, and more detailed rate scenarios for council consideration.
