Mayor explains PSC review that would raise Delavan water charges; residents say they were blindsided

The mayor of Delavan told residents at the council meeting that the Wisconsin Public Service Commission (PSC) has completed an initial review of the city’s water utility and produced a preliminary finding showing an average increase of 52.69%, which the mayor said would amount to about $20.08 per month for a typical household if adopted.

The mayor said the city requested a rate review at the recommendation of municipal financial advisers Ehlers to avoid a larger mandatory review and to lower the capital recapture component by more than 20 percent. "Our municipal financial advisers, Ehlers, anticipated the utility would be subject to this review," the mayor said. He added that the PSC evaluates historic and future financial conditions and that a final PSC decision is expected this fall; any approved increase would take effect roughly 90 days after the PSC issues its order.

The mayor sought to clarify what drives the increase, saying development is not the cause: "The present expansion of water services for new development in the city is paid by developers and impact fees," he said, adding that new customers generally improve the utility’s finances. He told residents that the PSC reviews cost calculations for reasonableness and accuracy and said the city is committed to cost control and more frequent, modest rate reviews in the future.

Residents at the meeting urged greater notice and transparency. Jesse Grover said he and others were surprised to receive the notice and learn of the hearing on short notice: "It felt like we were blindsided," Grover said, and raised concerns about earlier approvals he said the council had adopted in 2024 and the potential effect on public projects such as the library. Grover also told the council he had seen an estimate that the school district’s water costs could rise by 95% and said that would materially affect taxpayers.

Grace Hurdy said the timing and notice disadvantaged low- and middle-income households and urged the council to improve public outreach: "Give them more notice," Hurdy said, adding that constituents deserved better advance information about decisions that significantly affect household budgets.

What happens next: the mayor said the PSC has extended public comment opportunities and that residents who have not yet submitted comments still have time. The council did not take a formal vote on any local ordinance or rate change at the meeting; the PSC — not the council — will issue the regulatory decision that sets water rates under state process.

Reporting note: The mayor provided the percentage and the approximate monthly-dollar impact during his remarks; the 52.69% figure and the $20.08 estimate are those given on the record at the meeting. The mayor also referenced Ehlers and described the city’s request for a rate review; residents’ comments about a 95% school-district increase were reported at the meeting by Jesse Grover and were not independently verified in the council record.