State study finds $102 billion water-infrastructure gap; study recommends a volume fee to raise roughly $150 million annually

A state‑commissioned study required by HB280 estimates Utah will need about $102 billion for water, sewer and stormwater infrastructure through 2070 and recommends a statewide funding approach that could include a volume‑based user fee. At a Legislative Policy Committee meeting of the Utah League of Cities and Towns on Nov. 17, League staff summarized the final report and members raised questions about legal and equity implications.

The study’s headline finding — $102,000,000,000 in estimated infrastructure needs through 2070 — reflects long‑term investment shortfalls across basins, the presenter said. The report modeled a revenue scenario that would raise roughly $150 million per year by implementing a volume‑based user fee, described in the presentation as approximately $0.40 per 1,000 gallons of water and about $0.21 per 1,000 gallons of sewer.

“We’re not arguing for the study’s policy; we’re presenting what the study says,” the League presenter told members, noting the figures come from the Department of Water Resources’ contracted analysis. The presentation also highlighted the study’s comparison to the U.S. Environmental Protection Agency’s affordability benchmark of 4.5 percent of median adjusted gross income and showed Utah’s current averages (presenter cited roughly 1.24 percent for water and 0.86 percent for sewer/stormwater).

City officials and League members pushed back on several points. Some asked whether basin contributions would be returned to those basins or pooled statewide, noting the study proposes a statewide fund that would later allocate dollars by basin. Others warned of “rate fatigue” for residents who have recently faced fee increases and cautioned that higher fees risk displacing low‑income and senior households.

League staff flagged two legal issues the study itself raises: a potential lack of a direct nexus between a statewide fee and the specific cost of service for individual systems, and concerns that a fee structured this way may not conform to the American Water Works Association standards referenced in Utah code. The study recommends the Legislature consider amending code to address those legal constraints, a step League staff said would not obviate existing court jurisprudence on nexus requirements.

Staff asked cities to review the final report and to provide their local fiscal and implementation concerns to legislators before the 2026 session. The League said it will circulate the study in its follow‑up email and may convene webinars or working groups with the Department of Water Resources to address technical questions.

Next steps: the League urged municipal leaders to share local impact details with legislators and utility staff so lawmakers have practical data before any bill language is drafted.