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Monona staff recommends 20% sanitary sewer rate increase; committee approves and advances to council
Summary
City staff told the Finance & Personnel Committee that a 20% increase in sanitary sewer rates is needed to meet revenue-bond covenants after two years of higher-than-expected charges from the regional sewerage authority and increased debt service; the committee voted to approve the increase and forward it to the City Council.
City of Monona staff told the Finance & Personnel Committee on June 16 they will seek a 20% increase in sanitary sewer rates to meet bond covenants and cover larger-than-expected charges from the regional sewerage authority.
“I'm requesting a 20% rate increase in the sewer utilities,” Mark said, citing three drivers: higher charges from the regional sewerage authority, recent increases in the city's debt-service obligations, and relatively flat sewer usage that reduces revenue growth.
Mark told the committee that Madison Metro (the regional sewerage authority referenced in committee materials) raised charges substantially in 2023–2024. He said Madison Metro’s billing methodology—sampling flows one week per quarter and applying that reading to the quarter—can magnify the effect of storm or seasonal events and has produced unusually high flow readings in several monitoring quadrants. The committee discussed that three monitoring areas (Midmore lift, Birch Haven, and Riverplace) showed sizable increases in flow during the third quarter, which drove a large portion of the higher charges.
Mark said the sewer utility recorded a loss in the prior year driven primarily by the regional charge increases and that recent large borrowings for capital projects raised the utility’s principal-and-interest costs by roughly $100,000. He presented a schedule showing that without a rate increase the utility would fail to meet its required coverage ratio for revenue bonds. The proposed 20% increase is intended to restore the utility to the bond covenant minimum of a 1.25 coverage ratio.
Committee members expressed support for the rate increase while urging continued work to understand and, where possible, push back on the regional authority’s billing. Several members said they want more communication and cooperation through the Dane County Cities and Villages Association and direct engagement with the regional sewerage authority’s new executive director.
The committee voted to approve the rate increase recommendation and advance the item to the City Council for final action.
