Fargo staff presents three options for fixed water-meter fees as city replaces older meters
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Summary
Troy, a city water staff member, outlined three rate alternatives to address bill impacts that will result when the city finishes replacing smaller five-eighths-inch residential meters with three-quarter-inch meters during a multi-year meter-replacement project.
Troy, a city water staff member, told the commission that a citywide meter-replacement project will standardize residential meters to three-quarter inch and that switching remaining five-eighths-inch meters to three-quarter will raise many core-neighborhood customers’ fixed monthly fees unless the commission modifies the fee structure.
Why it matters: Staff estimates about 52 percent of remaining residential meters are five-eighths inch and about 48 percent are already three-quarter inch; roughly 11 percent of the meter-replacement project had been completed at the time of the meeting. Replacing a five-eighths-inch meter with a three-quarter-inch meter would raise the fixed monthly charge for those customers under the city’s current fee table.
Troy presented three alternatives:
- Alternative 1 — keep the current structure: after replacement, the minimum (base) charge would increase from about $10.40 to about $20.20 per month, producing an estimated revenue increase of about $1.66 million. Under this alternative, five-eighths-inch customers (concentrated in core neighborhoods) would face an average bill increase of about $9.80 per month.
- Alternative 2 — blend five-eighths and three-quarter charges: set a single base rate for both meter sizes (illustrative blended base rate shown as $14.75 per month, with the first 2,000 gallons included). This approach is revenue-neutral in staff analysis; it would lower the average base fee for current three-quarter customers by about $5.45 and raise the five-eighths customers by about $4.35 on average. Multifamily and commercial customers would remain at the higher base in the model presented.
- Alternative 3 — move to a purely volumetric billing model (no base charge): staff modeled a revenue-neutral volumetric approach. In that scenario, many residential customers would see smaller changes but large commercial customers (examples cited included NDSU, Castle Lake Premium and Sanford Health) would face substantial increases.
Commissioners asked about operational savings from automated meters. Troy said meter readers have been redeployed and that the city had three meter-readers previously; staff will provide a cost comparison and estimated savings from automated reading. Commissioners also raised the option of an opt-in upgrade path and multi-year phase-in to mitigate core-neighborhood impacts; Troy said the project is underway and roughly 11 percent complete, and that the city aims to standardize meters by 2027.
Ending: Troy said staff will return with more detailed financial modeling, a breakdown of meter-reader savings, and recommended timing if the commission wants to adopt a blended or volumetric structure.
