Consultants and officials urge near‑10% water, sewer and stormwater increases; public raises affordability and access concerns

Wilmington officials and consultants presented a six‑year financial plan for the city’s water, sewer and stormwater utility at the April 29 finance committee hearing that recommended a two‑year ‘heavy‑lift’ rate path: a proposed 9.95% increase for FY2027 followed by an additional significant jump in FY2028 to cover operations, debt service and capital needs.

Black & Veatch consultants and Public Works staff framed the proposal around three primary cost drivers: the capital improvement program (CIP) to rehabilitate aging linear assets, compliance with new regulatory mandates (including the EPA’s PFAS drinking water rule and the October 2024 lead and copper rule improvements), and elevated operations and maintenance inflation. The city’s six‑year CIP totals were presented at roughly $412 million (about $265M water and $147M wastewater) for the study period.

Consultants said the plan relies heavily on state revolving fund (SRF) loans and principal forgiveness to reduce borrowing costs: ‘‘We are leveraging low‑cost SRF financing and principal forgiveness where available,’’ Rupa Jha of Black & Veatch told council. They estimated SRF/principal forgiveness would account for the vast majority of planned financing in the six‑year outlook.

On near‑term revenue, Black & Veatch showed that under existing FY2026 rates the utility faces a shortfall. The administration’s recommended path — 9.95% in 2027 and roughly 9.5% in 2028 — produces an estimated FY2027 revenue level of about $106 million after accounting for customer delinquency, but consultants said the FY2027 revenues still leave a small gap (about $900,000) that would be managed in part by a $1.0M withdrawal from the rate stabilization reserve and by one‑time PFAS settlement receipts.

The consultants translated the proposed FY2027 increase into customer impacts: a typical inside‑city residential customer (5/8" meter, 4,000 gallons/month) would see the combined water, sewer and stormwater bill rise from about $76.11 to roughly $84.06 — a $7.95 monthly increase — while an outside‑city water‑only customer would see about a $6.45 increase to the water portion.

Committee members probed several assumptions: the presenters said PFOS levels were ‘‘slightly above the proposed EPA limits’’ in some tests and that a pilot study and approximately $2 million in grant funding are in place to determine PFAS treatment options ahead of the 2031 compliance deadline. Officials also detailed operations cost drivers such as increased chemical purchases for taste and odor control and a recent bond issuance that raised debt service.

Council members and members of the public flagged affordability and collection problems. Several council members noted that household budgets are already strained and that delinquency rates have risen; public commenters urged expanded customer assistance, protections against shutoffs for vulnerable households, and rapid action to provide potable water and sanitation at Christina Park, where residents and outreach volunteers said people currently lack reliable access.

Officials noted programmatic supports in the plan, including a $60,000 annual homeowner connection subsidy (caps at $1,000 per household) and a six‑year assistanceline averaging $350,000/year for elderly and disabled customer discounts and other customer support, but the public urged more aggressive outreach and targeted assistance to reduce delinquencies.

Black & Veatch and OMB staff said the recommended increases are intended to restore financial resilience — meeting an ordinance requirement to maintain an operating reserve (roughly 17% of O&M) and to rebuild a modest rate stabilization reserve — while seeking to smooth year‑to‑year bill impacts. Council will consider the budget and rate recommendations in the coming weeks as follow‑up materials are prepared.