FLOW Committee flags 7% water rate target for 2027 as wastewater costs rise to $697 million estimate

At a May 14 meeting of the Fiscal Leadership on Water (FLOW) Committee, Ken Rutt, Director of Water Utilities, presented proposed capital and operating priorities for fiscal year 2027 and underscored a targeted 7% water rate increase for 2027 as part of a five-year plan to preserve system reliability.

Rutt said the department is shifting its framing from “level of service” to “risk evaluation” and “reliability” to help the public understand why ongoing rate adjustments may be needed. He told the committee the five-year plan previously included specific year-by-year percentage increases, and that ongoing adjustments are necessary to manage deferred maintenance and maintain fiscal sustainability for the enterprise fund structure that must rely on user fees rather than property or sales tax revenue.

The presentation outlined key capital investments: a waterline replacement program budgeted at $15.7 million over nine years and an ongoing roll-out of standardized automated meter reading (AMR) water meters, with quantities and timing adjusted to budget constraints. Rutt also announced an asset management software project planned to begin in September to reduce reliance on external consultants.

On wastewater, staff reported a substantial revision to long-term cost estimates. The wastewater facility projected cost rose from $524 million to $697 million (updated February 2026), primarily because the project schedule was extended through Phase 4 into 2040 and escalation assumptions increased. Rutt told members a potential Phase 5 project, conceptual and contingent on uncertain regulatory drivers, could add roughly $180 million; staff characterized all figures as Class 5, rough order-of-magnitude planning estimates with wide possible variance.

The committee also reviewed water supply sources—Colorado–Big Thompson allocations, Denver Water deliveries and reusable water—and discussed upcoming regional storage capacity from the Chimney Hollow Reservoir, which the presentation said will give Broomfield more control over its share of storage.

Staff warned that new MS4 stormwater permit requirements are expected to increase costs for sampling, maintenance and inspections for stormwater programs. Committee members commended the presentation materials for clarity and historical context and asked staff to focus written feedback on major budget items.

Next steps were set: finance staff will provide documentation on the revenue model and rate recommendations by May 21; the June FLOW meeting will be critical for finalizing rate recommendations; and the committee is scheduled to present final recommendations to the Council on July 21. Public outreach dates noted included a Public Works & Water Utilities Academy event on May 16 and a neighborhood meeting about North Area water tanks on June 4.

The meeting was called to order by Chair Steve Pierotti and adjourned at 8:08 p.m.