Evansville Utility leaders outline groundwater plan, V‑Slough enclosure and major capital slate for 2026

Evansville Water and Sewer Utility officials described a 2026 operating and capital program that centers on a groundwater strategy for potable supply, major sewer-system projects and higher electricity costs that are driving part of the budget increase.

Vic Kelson, executive director of Evansville Water and Sewer Utility, said the groundwater plan — a regional source and treatment approach — would save the utility about $100,000,000 in upfront capital compared with building a new surface‑water plant and reduce future operations costs. Kelson said the utility expects to advance design contracts in the coming weeks and to finance construction through bonds and previously collected reserves.

Kelson also flagged planned sewer work: design contracts for the V‑Slough enclosure (a project that will use multiple box culverts and a new lift station) are expected to be awarded in late 2025, with construction anticipated in 2026. Utility finance staff (Keith Penny, director of finance) estimated initial construction phases for the V‑Slough work at roughly $42,000,000 and said the sewer capital plan includes multiple related separation and capacity expansions.

The utility told the council it expects to absorb higher electricity costs: staff budgeted an $1,800,000 increase in electric expenses for 2026 because the utility is a large electricity consumer, particularly at treatment plants. Officials said they are pursuing energy-efficiency and solar projects where practical and noted a $2,400,000 solar feasibility item in preliminary sewer capital planning for the East plant.

On rates, Kelson said the utility does not plan to request additional water or sewer rate increases in the next 2–3 years, but staff will continue to monitor electricity market changes. Keith Penny said combined utility operating revenue is budgeted at about $177,000,000 and combined operating expenses (excluding capital financed by bonds) are roughly $156,600,000 for 2026; the utilities plan more than $200,000,000 of bond‑funded capital next year alongside about $30,000,000 of operating‑funded projects.

Kelson and Penny also briefed the council on the Riverside Drive sinkhole repair, saying work is progressing and repairs are expected later in the fall. They added that the utility has been negotiating with EPA and IDEM over the long‑running integrated overflow control plan to reduce overall program costs and is optimistic about finishing the regulatory review by year‑end.