Trenton Water Works consultant proposes three years of 14% rate increases to fund $230 million CIP

A consultant hired to study Trenton Water Works’ finances told the City Council on June 17 that the utility will need multi-year rate increases to cover a roughly $230 million capital improvement program and sharply higher debt service.

Piper Brandt, chief executive officer of Raptellus, summarized a financial plan showing total revenue requirements rising from about $60 million to about $82 million between 2025 and 2030, with debt service identified as the main driver of the growth. Brandt said the proposed approach is three 14% across-the-board rate increases in FY2026, FY2027 and FY2028, followed by smaller annual increases in FY2029–30 (about 4%), to fully fund regulatory-driven capital projects while limiting customer impacts.

Brandt told council members that the capital improvement plan (CIP) includes roughly $230 million in required projects over five years, “mostly regulatory driven,” and that Trenton Water Works has not raised rates since 2020. She said the utility’s projected revenues without rate increases would not meet revenue requirements and the selected option uses some reserve funds in the near term while refilling them in later years. Brandt showed bill impacts for a typical residential customer using 20 CCF per quarter: the FY2026 increase would raise annual bills by about $68 (roughly $5.67 per month). She said the volumetric charge would rise from $2.11 per CCF to $2.41 in year one under the proposal. Brandt also compared Trenton’s bills to those of local investor-owned utilities and said Trenton would remain near or below median bills for the state even after the increases.

Council members questioned meter sizing, the composition of customer classes, and alternatives such as a higher single-year increase or a formal cost-of-service study to differentiate residential and nonresidential charges. Councilwoman Frisbie asked what a CCF represents; Brandt answered that a CCF is 100 cubic feet (about 748 gallons). Councilwoman Williams pressed on the timing of sharp jumps in debt service in 2026 and 2028; Brandt said the precise debt schedule depends on how the city layers new borrowing with existing obligations and noted the consulting team used standard assumptions and the city’s typical debt structure. Brandt and council members discussed the utility’s current single customer class, the billing system’s inability to differentiate residential from nonresidential accounts without additional work, and the tradeoffs between raising the fixed meter charge (which improves revenue stability) versus volumetric rates.

Several council members asked whether the plan assumed replacement of lead service lines and other regulatory obligations; Brandt said the CIP figure the consultant received (about $230 million) was assumed to include those items and that the recommended increases would support the published plan if the cost assumptions hold. Council members also asked whether a financial-advisory engagement to explore debt structuring and alternative financing could be added; Brandt said the consulting team can work with the city’s financial advisor and municipal-finance team to model different debt structures and their rate impacts.

The discussion identified choices and constraints rather than a final decision: council members asked for additional detail about the debt schedule, whether separate customer classes should be created, and whether a dedicated cost-of-service study or billing-system changes are warranted. No formal rate change was voted on at the June 17 meeting.

Brandt’s presentation and council questions emphasized three points: Trenton’s revenue base is low compared with nearby utilities; required regulatory projects and planned borrowing drive much of the near-term revenue need; and a staged, multi-year rate plan would smooth customer impacts while funding the CIP, according to the consultant’s model. The council asked staff and the consultant for follow-ups on debt timing, financing options, and comparative bill components for nearby utilities so members could review the specifics before any formal rate ordinance is introduced.