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Port Arthur council hears attorney general lawsuit background and a consultant— recommended 20% water-wastewater rate increase
Summary
Consultants told the City Council that Port Arthur—s utility fund is in deficit and recommended a 20% across-the-board water and sewer rate increase for fiscal 2026, part of a multi-year plan to address an attorney general enforcement suit and rebuild utility reserves.
Port Arthur City Council on Tuesday received a legal update and a rate-study presentation that underpins a proposed 20% water and wastewater rate increase for fiscal 2026. The city—s outside counsel and a rate consultant told council members the move is meant to address long-running operational shortfalls and to show progress to the Texas Attorney General, which filed suit earlier this year over sewage discharges.
NewGen Strategies partner Eric Kolokhia, who led the rate study presentation, said the utility fund is currently operating in the red. "At the end of this fiscal year it is forecasted that the utility fund will have an operating budget deficit of $5,500,000," Kolokhia said, and the study recommends a 20% increase in rates for 2026 plus future increases as needed to restore reserves and fund capital work.
Kolokhia said the study assumes the utility fund must be self-supporting and that recent transfers from the general fund to the utility fund will…
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