Get AI Briefings, Transcripts & Alerts on Local & National Government Meetings — Forever.
Manager outlines 15% water and sewer rate increase to fund utilities expansion and staffing
Loading...
Summary
Fuquay Varina's manager said the FY27 utility budget follows a rate model that calls for a 15% combined water and sewer increase in FY27 (with further increases planned in out years) to fund large capital projects, staffing to meet permit requirements, and system maintenance; a typical in-town household using 5,000 gallons would see about a $21.10 monthly increase.
Town Manager Adam Mitchell presented the enterprise (utility) portion of the FY27 budget and told the board the town’s Stantec rate model indicates a 15% increase in combined water and sewer base and volumetric rates for FY27. "The assumptions for revenues this fiscal year, operating budget fiscal year 27 includes a 15% change in water and sewer base and volumetric rates consistent with our Stantec rate model," Mitchell said.
Mitchell said the rate plan is intended to fund major capital projects already underway or committed — including the Terrible Creek Wastewater Treatment Plant expansion to 6 MGD, the Sanford Water Treatment Plant conveyance and expansion projects, and the Harnett regional wastewater-expansion partnership — and to provide funds for increased staffing, equipment, and ongoing maintenance. He explained that the town intentionally built cash reserves earlier through rate increases to smooth future years’ rate pressure and to meet bond-covenant metrics such as cash-on-hand and debt-service coverage.
He quantified household impacts: "The combined monthly bill for an in town resident using 5,000 gallons per month, which is average, will increase $21.10 per month," he said, noting many households use less than that. The rate model also projects additional increases in out years (e.g., 15% in FY28 under the current model, then smaller increases thereafter) unless growth and other revenue assumptions change.
Mitchell said growth-driven infrastructure needs and regulatory staffing requirements are major drivers. Expansion of Terrible Creek to 6 MGD, he said, triggers 24/7 staffing and more lab capacity. He outlined several proposed utility positions (operators, lab supervisor, technicians) and equipment purchases to meet permit and operational responsibilities. The manager said some projects (for example, the Sanford conveyance line) face permitting timing risk and could affect scheduling but that staff are working to avoid construction slips.
Board members asked for a plain-language explanation of the 15% increase; Mitchell summarized the drivers as large capital commitments, higher market costs for construction and materials, and the need to maintain reserves and rate-smoothing to meet bond covenants. Several commissioners acknowledged the complexity and urged clear public communication about timing and household impacts; the manager said the utilities director and communications staff will provide materials before formal adoption.
Ending: The manager will present the recommended enterprise budget on May 4; the rate schedule and system-development fee changes will be set for public hearing and adoption as part of the town’s published budget process.
