Staff recommends 8% water-rate increase and modest solid-waste fee hikes as part of FY2026–27 budget

At a High Point City Council work session, staff said a combination of debt service, capital needs and unplanned operating costs drove a proposal for an 8 percent increase to water and sewer rates effective Oct. 1, 2026, and other fee-schedule changes across city services.

Budget and Performance Director Steven Howard summarized the drivers: in addition to the cost-of-doing-business increases, the East Side incinerator outage led to hauling and a change order that hit operating budgets; Howard said that change order was on the order of several hundred thousand dollars. He told council the water fund is also carrying debt-service obligations and capital planning costs as staff implement projects identified in a water distribution master plan that estimated about $87 million in needs over 15 years. (Steven Howard, Budget and Performance Director)

Howard presented the proposed fee changes that staff will include with the budget: a proposed 8% water/sewer rate increase effective Oct. 1, 2026; a proposed $2 monthly increase to the solid-waste availability fee (collection only); and modest per-ton price increases at the Engleside composting facility (engineered soil to $25/ton, wood mulch to $20/ton, compost to $23/ton, leaf mulch to $20/ton). Howard said the solid-waste collection function has operated with deficits in recent years and the fee increase helps stabilize that enterprise fund.

Assistant City Manager Damon Dukane described the rate-study work intended to inform how revenue needs are allocated across customer classes: "Do a cost of service study...what does it cost to actually serve say a commercial or an industrial customer and then adjust those rates accordingly," Dukane said, explaining structural options such as increasing-block rates that could better align charges with usage and customer type.

Howard said staff have completed the revenue-need portion of the water rate study and will return with recommendations on how to achieve the required revenue through structural and percent-change options. He also said staff will expand feasibility work for solid waste and long-term landfill planning to address the eventual closure of the Kersey Valley landfill, noting that planning assumptions currently consider a transfer-station approach and that closure timing is an estimate (staff offered ~2040 as a working timeframe).

Next steps and public input: staff said the rate study results and detailed fee schedules will be presented at follow-up hearings and work sessions; a public hearing on the budget is scheduled at the next council meeting and tentative budget adoption is set for June 1. No formal rate ordinance or fee adoption occurred at the work session.

The council requested additional detail on any single line item or program showing year-over-year increases above 15–20 percent and asked staff to return with supporting analyses before any formal adoption vote.