Spotsylvania supervisors approve changes to water, sewer rate structure after PFM review

Spotsylvania County supervisors on Tuesday approved changes to the county's water and sewer rate structure following a presentation by financial adviser PFM that recommended simplifying tiers, shifting more revenue to fixed charges and phasing increases over two years.

PFM consultant Christie Choi told the board the firm recommended a 60% variable / 40% fixed allocation for water and a 65% / 35% split for sewer, phased in over five years to reduce bill shock. PFM also proposed collapsing usage tiers to three bands, and combining existing fixed components into a single fixed service charge of $17.65 per month per equivalent unit in the model presented for fiscal 2026–27.

The recommended changes aim to align rates with rising debt service and operating needs tied to two major water and wastewater projects: the Massaponics wastewater treatment plant expansion and the Mott’s Run water treatment plant expansion. PFM said the two projects together exceed $250 million and that segregating water and sewer revenue requirements shows sewer needs will drive larger near-term increases.

Board members questioned the moves during the public hearing and presentation. Supervisor Ms. Hayes and others pressed staff for clarity on bill impacts for typical customers and on the rising share of bills that are debt service and administrative charges. County staff and PFM responded that the restructuring is intended to make the bill presentation clearer (consolidating debt/administration into a fixed charge) and to preserve conservation signals in variable charges.

Ben Petrovich, speaking for county utilities staff, said the county historically used availability (hookup) fees to cover much of its capital debt when construction was booming, but availability revenues declined and the county moved toward recovering debt through rates. Petrovich and PFM told the board they plan to monitor revenues annually and return to the board every two years—shortening the prior three-year review cycle—so the county can adjust rates to actual debt and CIP changes.

PFM showed sample bill impacts: a low-usage “lifeline” household (about 1,200 gallons/month) would see a bill move from about $37.92 in fiscal 2025 to roughly $41 in 2026 and about $45.80 in 2027 under the proposed schedule; an average household (about 4,300 gallons/month) would move from roughly $73 to $83 and then about $90. The firm attributed most of the increase to sewer requirements rather than water.

After public comment and discussion—including reminders from supervisors that utility funds are enterprise funds and do not draw on general tax revenue—the board voted to adopt the advertised County Code amendments to Chapter 22 related to utility rates and fees. The roll call recorded seven yes votes; the motion passed.

The county plans to publish an online, interactive CIP map and other materials to explain major projects and timing. Staff also said a portion of grant and community project funding already secured (roughly $4.5–$5.0 million in EPA/community project funds for Mott’s-related work, per staff) reduced the borrowing needs but that the timing of two large plant projects overlapping increased near-term debt service.

The board directed staff to continue outreach explaining bill changes to residents and to return with annual updates or sooner if the CIP changes materially.