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Study finds $1.2B annual water infrastructure need; statewide fee options analyzed

Natural Resources, Agriculture and Environment Interim Committee · November 19, 2025

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Summary

A Legislative Water Infrastructure Fee Study estimated Utah needs about $1.2 billion per year for water infrastructure, with local agencies able to raise about $848M and a $344M annual gap. The study models a volumetric user fee; one option to raise $150M would cost about $11.27 per month for a median household.

Candace Hosniger, director of the Utah Division of Water Resources, and Eric Danitz of Zions Public Finance presented a statewide water‑infrastructure fee study tied to HB 280 (2024), describing the scale of the challenge and options for generating a stable state revenue stream.

The study estimates an overall annual need of roughly $1.2 billion to maintain and upgrade drinking-water, wastewater and irrigation infrastructure statewide. It found local agencies could likely generate about $848 million per year through rate increases and other local measures, leaving a gap of about $344 million per year.

"One of the things this study covers is who should be assessed, how to calculate the fee amount and how the money collected should be spent," Hosniger said. The report evaluates volumetric user fees and other revenue options and models affordability for households and institutions.

Danitz explained that, under one modeled approach, $0.75 per 1,000 gallons of usage would yield about $150 million annually for the Water Infrastructure Fund created under HB 280. He said that revenue target translates to about $11.27 per month for a median household.

Members questioned distribution, project prioritization and rural equity. Danitz said the study assumes about 75% of new‑growth infrastructure needs can be met by local impact fees and that the unified plan will include a ranking and prioritization process at the river‑basin level. Hosniger said the study's authors will present more detailed recommendations and a unified water infrastructure plan in the coming months.

The committee did not vote on fee design at this meeting; presenters and staff emphasized further public engagement and legal review would be required before any legislative proposal.