Coeur d'Alene presentation outlines $84.3 million water capital plan and a rate scenario with 22% increases through 2027

A rate-study consultant told Coeur d'Alene officials that funding an $84.3 million water system capital plan would likely require front-loaded rate increases and other revenue changes.

The consultant said the study uses the city’s 2025 water budget as the baseline and examines an eight-year planning window from fiscal year 2025 through fiscal year 2032 (the model is built to 20 years but concentrated on the eight-year rate-setting period). The consultant said revenue and expense forecasts assume 1.15% annual customer growth (about 300 new units per year) and roughly 3.5% annual expense inflation.

The nut of the presentation was the funding plan and scenarios. The consultant summarized one scenario that would fund the full $84.3 million capital plan through a mix of rate revenue, updated capitalization fees, and a new $5 million debt issue. That scenario would add roughly $736,000 in annual debt service on a 10-year payback. To support the full plan, the consultant said the city would need roughly 22% rate increases from 2025 through 2027, followed by 2% annual increases through 2031. The consultant estimated the monthly impact for a single-family residence would be about $5.23 in 2025 and grow to about $7.80 by 2027 before dropping to less than $1 per month in later years under that scenario.

On reserves and coverage, the consultant said the study targets 90 days of operating and maintenance (O&M) expenses as a reserve goal (the presentation listed that target as “between 1.4 and 1800000.0” in the slides). The consultant also said current annual fee revenue is about $7.9 million and would grow to about $8.6 million under the assumed customer growth; current O&M expenses presented were about $5.8 million, rising to about $7.5 million by fiscal year 2032 under the inflation assumption.

The consultant described the capital program’s scope: the comp plan’s identified projects include supply needs, booster station replacements, storage tank maintenance, distribution and transmission mains, and other capital improvement projects. The presentation included a five-year project map and a 20-year outlook estimating when new wells and tanks might be needed depending on growth rates. City staff noted some map-orientation issues in the materials provided (the comp-plan map was rotated with north to the left in the brochure), and said each mapped project identifier links back to the comp plan’s map for location detail.

When asked about a referenced “12,000 gallons a month” figure, the consultant said that number reflects an annual average drawn from city customer statistics; winter average monthly use is closer to 5,000–6,000 gallons and can increase as much as fourfold in summer because of outdoor usage. The consultant cautioned that cutting capital costs to reduce near-term rate impacts could increase risks: deferred maintenance, reduced capacity for growth, or unknown infrastructure consequences depending on the specific projects deferred.

City staff addressed the plan horizon and delivery cadence. Kyle (city staff) said the city typically focuses on a five-year capital plan while maintaining a 20-year planning view and that the city has “stayed pretty close on track with our comp plan” over the past decade, accommodating annexations and growth as needed.

No formal motions or votes on rates, capitalization-fee changes, or debt issuance were recorded in the transcript excerpt. The presentation closed with questions from elected officials and staff clarifications; the consultant and staff will need to return with recommended rate ordinances, capitalization-fee updates, and details of any proposed debt issuance before formal action would occur.

The presentation included the following numeric details as stated by presenters: study timeframe FY2025–FY2032 (8 years); model horizon 20 years; reserve target 90 days O&M (slide text: “between 1.4 and 1800000.0”); current annual fee revenue about $7,900,000, projected to about $8,600,000 under growth assumptions; current O&M approximately $5,800,000, rising toward $7,500,000 by FY2032 under inflation; identified capital projects totaling about $84,300,000; proposed new debt proceeds of $5,000,000 with roughly $736,000 annual debt service on a 10-year term; assumed expense inflation ~3.5% annually; customer growth ~1.15% annually (~300 new units/year); a sample rate scenario of 22% increases 2025–2027 then 2% annually through 2031 with an estimated single-family monthly bill change of $5.23 (2025) to $7.80 (2027).