Consultant: Willard needs big upfront water and sewer increases to avoid sewer shortfall

Carl Brown, a rate consultant and former Missouri Department of Natural Resources official, told the Willard City Council that the city’s water and sewer utilities require significant initial rate adjustments to avoid a projected wastewater‑fund shortfall.

Brown said much of Willard’s wastewater treatment is contracted to the City of Springfield and that increases in Springfield’s charges, plus several near‑term capital projects, drive the need for revenue increases. “The rates are gonna go up a lot,” Brown said, summarizing his model of near‑term capital needs and treatment‑cost inflation.

Why it matters: Brown’s 10‑year model estimates water‑side revenues need to increase by about 48.6–48.7 percent and wastewater revenues by roughly 51 percent to bring funds current and to rebuild reserves over the planning horizon. Without adjustments, his projection shows the sewer fund falling into a negative reserve position (about $616,000) around 2026. The model also shows the water fund holding stronger reserves (about $1.2 million near term) and able to temporarily support sewer if needed.

What Brown recommended: Brown proposed keeping the town’s simple in‑town/out‑of‑town minimum structure rather than moving immediately to a meter‑size minimum. He recommended retaining the system‑development (plant investment) fees that Cochran Engineering calculated because his independent calculations closely matched Cochran’s. For recurring adjustments he recommended setting rates to cover the budget and then indexing modest annual increases to inflation (Brown suggested 3–4 percent as a plausible ongoing adjustment).

Specific numbers in the study: Brown identified a recommended in‑town water minimum monthly charge near $12.57 and a unit charge near $3.91 per 1,000 gallons; he recommended an out‑of‑town premium around 50 percent above in‑town rates. For wastewater he summarized a minimum charge near $26 and a unit charge near $11.50. Brown also presented affordability indices showing a typical 5,000‑gallon residential water bill currently near 0.40 percent of median household income (estimated median ~$86,000) and modeled it rising to about 0.46 percent after the adjustment; sewer affordability rose from roughly 0.83–0.86 percent to about 1.22 percent under the proposed schedule.

Council questions and operational points: Councilors and staff asked about the number and treatment of out‑of‑town customers; Brown said the billing data showed about 1,171 out‑of‑town water customers of 3,719 total customer equivalents. Council and staff discussed options to manage collection risk on out‑of‑town accounts (for example, rights‑to‑annex filings or applying higher out‑of‑town premiums) because the city has fewer enforcement levers for customers outside corporate limits.

Ordinance and reserve alignment: Councilors raised a written Willard ordinance that references a 30 percent reserve target for the utility. Brown said his model targets a 50 percent operating reserve and a larger capital/debt reserve by year 10; staff agreed to have the city attorney review whether the ordinance’s language is a floor, ceiling or an enforceable threshold and whether rate recommendations would require an ordinance amendment.

Next steps: Staff announced a public hearing on water rates at 6 p.m. Oct. 6 in the community center. Brown’s report and rate tables are in the meeting packet for review; Brown encouraged adopting the modeled adjustments promptly to avoid deeper shortfalls.

The council had questions and clarifications during the presentation and did not take a final vote on the rate ordinance at this meeting; the public hearing and any ordinance reading(s) will determine final action.