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Public Works Committee reviews draft 2026 stormwater, water and sewer budgets amid several costly projects
Summary
City staff told the Public Works Committee the draft 2026 stormwater, water and sewer budgets hold mostly steady but include several large capital projects, a potential $3 million project shortfall, a planned PSC-driven chart-of-accounts transition and a planned rate study; officials discussed hookup fees, PFAS/radium treatment, and a deep well at Still River.
City staff presented the draft 2026 budgets for the stormwater, water and sewer utilities at the Public Works Committee meeting, flagging several high-cost infrastructure projects and a mismatch between projects and projected revenues.
“We have $3,000,000 worth of projects that are over what we have coming in,” Speaker 1 said while reviewing the stormwater program, noting major stormwater work planned for Lexington–Tacoma (large drainage channel and culvert replacements), Glenwood Lane in Springdale Estates (repaving with added inlets), and a $750,000 Valley Brook subdivision ditch cleanout to address backups in smaller storm events. Staff said they are pursuing easements and working with Payne & Dolan where needed to stabilize drainage channels and protect nearby sewer and water crossings from erosion.
The water and sewer presentations explained why some budget lines look irregular: the utilities converted to a new chart of accounts in 2024 and, staff said, the city is now considered a “class AB utility” by the Public Service Commission. “In 2024 we converted to a new chart of account system because we are now considered a class AB utility for the Public Service Commission,” Speaker 7 said, explaining that the PSC-required account granularity created redundant wage accounts and transitional entries that will be cleaned up over another budget cycle.
Speaker 7 also described anticipated new development revenue: roughly 40 single-family home connections expected in 2026 and several apartment buildings, including five buildings along Ridgeview Parkway, that should add customer accounts and connection fees. Officials discussed how apartment hookup fees are calculated in residential-equivalent units. “It’s a proportionate, I guess, you’d call it,” Speaker 7 said, noting apartment units are typically assessed at about half to three-quarters of a single-family home equivalent under SORPAC guidance.
On capital projects, the water budget includes groundwater-related investments, radium and PFAS treatment planning, and a planned deep well at the Still River facility. Staff said a Blue Mound Road connection between Bussey and Foster Court will be expensive and may require a bridge with the water main carried on it. Speaker 7 flagged a long-standing sewer replacement need along Kotmire (noting an estimate of “1.75” in the transcript; units were not specified) and said Sherwood Forest sewer work will begin.
Intergovernmental projects were discussed: staff said the adjoining village plans to replace its Kottmeyer lift station and that the city would assume about 90% of the flows, representing an expected city charge near $1 million of a roughly $1.2 million project. Speaker 1 said the village is cooperating to move connection points for topographic reasons and to avoid forcing a larger expansion of the village’s lift station.
Other operational items in the budget review included planned migration of billing and accounting to cloud-based software in 2026 (with an expected increase in software costs but improved integration), rising chemical and electric costs, increased required continuing education for DNR-certified staff, and attorney fees related to the water facility plan study and potential municipal agreements. Speaker 7 told the committee the city engaged Ehlers for a rate study to evaluate collection and rate structures.
Boat launch revenues and enforcement also came up: staff said launch revenues have declined and proposed installing cameras with license-plate readers and online payment (QR) options to reduce nonpayment. “We’re actually looking at that to see if that would be something where we could put a QR code… so they could pay online, versus right now it’s just a cash system,” Speaker 1 said.
The committee did not take final budget votes at the meeting; staff said they expect updated fund-balance figures after further accounting reconciliations and a follow-up meeting with the mayor. The meeting closed with procedural motions (minutes adoption and adjournment).
