Cheyenne utility leaders propose $3/$2 monthly service-fee increases, outline $500,000 lead-service inventory and water-rights strategy

Cheyenne utility managers told City Council members at an April 18 work session that they plan modest monthly service-fee increases and are moving to inventory and eventually replace lead service lines while pursuing alternative water supplies and large industrial customers to stabilize revenue.

The Board of Public Utilities (BOPU) is not proposing a per-thousand-gallon rate increase this year, Brad Brooks, director for the board, said, but staff will recommend a $3-per-month increase to the water service fee and a $2-per-month increase to the sewer service fee. The proposed water budget for fiscal year 2026 is $31,000,000 using $3,900,000 in reserves; the sewer budget is $17,000,000 using $100,000 in reserves, Brooks said.

The moves are intended to shore up revenue for routine operations, debt service and capital rehabs after fiscal 2025 included larger grant and reserve balances, Brooks and other staff said. "We are not planning on doing any cost per thousand increase on people's water rates this year," Brooks said, and instead staff recommends adjusting the base service fees to improve revenue stability.

Why it matters: Utilities in Cheyenne are selling less water than in prior decades even as the city grows, according to BOPU figures presented at the meeting. Staff said the utility now averages roughly 8.6 million gallons per day in sales versus about 13 million in 1999; that decline magnifies the revenue impact of conservation and drought-driven demand changes and increases pressure on reserves and capital programs.

Key budget and spending details

- Water: FY26 budget $31,000,000; planned use of $3,900,000 in reserves.…