Wichita staff recommend 6.23% water and sewer rate increase for 2026 to cover rising costs

Public Works Director Gary Janssen told the Wichita City Council’s workshop that the utility is recommending a 6.23% combined water and sewer rate increase for 2026 to preserve debt coverage, sustain a $900 million-plus capital improvement program and offset the loss of wholesale revenue.

Janssen said two wholesale customers — Derby and Valley Center — are building local treatment capacity and will reduce purchases from Wichita beginning in 2027, creating an estimated $2.5 million annual revenue shortfall and a roughly 400 million gallon annual decline in treated volume. He said the recommended 2026 increase (staff’s “Option 1”) anticipates those losses while also funding phased staffing additions at the Biological Nutrient Removal (BNR) facility and keeping debt-coverage ratios at the minimum required level.

"Our recommended option is option number 1, which would be an increase to most of our customers of $3.67 per month," Janssen said, explaining that the plan aims to meet a 120% debt-coverage requirement while acknowledging the utility’s historical goal of a 125% coverage buffer.

Why it matters: Wichita’s water and sewer utility is capital intensive and serves roughly 17% of Kansas residents through wholesale contracts. Officials told the council the utility must cover extensive infrastructure and rising operating expenses so it can maintain service levels and bond ratings.

Details and drivers: Janssen listed several contributors to the recommendation: an historic rise in chemicals and energy costs, difficulty hiring and retaining field operators that has raised contract-service spending, the staffing needs for the BNR project (about 13 additional positions phased in to operate new processes), and long-term debt tied to major projects. He said ops-and-maintenance spending that was under $47 million in 2021 is projected to approach $103 million by 2029 under current assumptions.

Two-rate scenarios: Staff reviewed two smoothing options. Option 1 (staff recommendation) sets the 2026 increase at 6.23% with an estimated $3.67 monthly increase for a typical low-volume residential customer; an alternative that shifts more burden to 2026 to reduce a projected 2027 spike would raise 2026 slightly more and lower the 2027 projection by only a few cents a month. Janssen said the higher 2026 approach produced only modest smoothing and the department recommends Option 1.

Assistance and mitigation: Janssen noted existing assistance programs, including the H2O Care fund administered by Center of Hope and a rate-relief program that can provide limited credits and payment-plan options. He said staff will continue outreach and return in early December with a formal recommendation and additional information — including a comparison showing the cost of restoring a 125% debt-coverage contingency.

Next step: Staff will refine the recommendation based on council feedback and bring a formal ordinance back to the council for consideration in early December.