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Commission adopts Banner Associates’ water and sewer rate study (Option 2)
Summary
The commission accepted Banner Associates’ five-year water and sewer rate study (Option 2), approving a ~3.5% water usage increase and ~11.5–12.4% sewer usage increases and directing staff to implement the study recommendations.
City staff presented Banner Associates’ updated water and sewer rate study and recommended adoption of Option 2. City Engineer/Utilities staff said Option 2 removes a project scheduled for 2028 to reduce near-term rate pressure, targets a minimum 50% operating reserve for water and a minimum ~15% for sewer during the study period, and phases rate changes over five years.
Staff said water usage rates under Option 2 would increase about 3.5% across the board and monthly meter charges would rise 2–3% for meters up to 3 inches; larger meters would see larger phased increases. For sewer, staff said the usage rate increase would be approximately 11.5–12.4% while monthly charges would rise 2.5–3.5%, moving more of the cost onto customers who use more sewer services. The study also reduced biochemical oxygen demand (BOD) and total suspended solids surcharge fees for the period and projected positive year-end cash results.
"The recommendations that came from that study was Option 2 for the water rates," staff said, adding the plan maintains cash reserves and meets coverage ratio requirements. Commissioner motioned to accept Option 2 and the commission approved it by roll call.
Staff noted the removal of a 2028 water-main project delays that work and spreads it later in the capital schedule; staff said ARPA funding and recent contractor schedules affected the timing of water-main replacements.
