Sterling approves higher electric, water and wastewater rates; electric vote splits 3-2

The Sterling City Commission approved ordinances on Jan. 20 raising the city's electric, water and wastewater utility rates, with the electric increase passing on a 3-2 vote. City Manager Ian Hutcheson told commissioners the adjustments are intended to close projected gaps between revenue and expenditure growth in the utilities' funds and to cover debt service tied to infrastructure for the KMW expansion.

Hutcheson said staff, working with Kansas Municipal Energy Agency staff and consultant Greg Wright, recommended a 13.3% increase to the electric consumption and service charges and related riders. The change would raise the average city residential electric bill by about $12.92 per month. He said sales-to-customers account for roughly 96% of Electric Fund revenue and that staff modeled future revenues and expenditures using 10-year average growth rates and known future debt-service obligations.

“An estimated 42% of the additional revenue generated from rate increases will go towards debt service on the 2025 Temporary Note issuance,” Hutcheson said, with the remaining revenue allocated to other utility operating expenses, according to the meeting record. After discussion and public comment, Commissioner Todd Rowland moved to adopt the electric ordinance for implementation with the April 2026 bills; Commissioner Bob Boltz seconded. The motion carried 3-2. Commissioners Clint Bundy and Richard Jones Jr. registered opposition.

The Commission also approved increases to water and wastewater rates to be implemented with the April 2026 billing cycle. Staff recommended a 22.1% increase in water consumption and service charges (an estimated $7.32 monthly increase for the average customer) and an 8.0% increase to wastewater charges (an estimated $2.38 monthly increase for the average customer). Commissioner Rowland moved and Commissioner Clint Bundy seconded the water ordinance; the motion carried unanimously. Commissioner Rowland moved and Commissioner Bob Boltz seconded the wastewater ordinance; that motion also carried unanimously.

Members of the public raised concerns during the meeting about how the increases will affect families, residents on fixed incomes, Sterling College, the school district and small businesses, and petitioned the Commission for more transparency and public engagement on major projects such as the KMW expansion. Commissioners acknowledged those concerns and discussed timing; several supported delaying the effective date until April 2026 to give customers more time to budget, which the adopted ordinances reflect.

The ordinances and staff presentations note that the 2025 General Obligation Temporary Note financing for KMW-related public infrastructure will require debt service through 2028, after which a permanent GO bond will be issued and the exact 2028 bond amount will be determined by actual project costs. Hutcheson told the Commission that the recommended rates will be revisited in 2028 once the permanent financing amounts are known.

Votes at a glance: - Electric ordinance (Sections 15-208, 15-209, 15-210): moved by Commissioner Todd Rowland; seconded by Commissioner Bob Boltz; outcome: approved 3-2 (Yes: Todd Rowland, Bob Boltz, Mayor Brian Inwood; No: Clint Bundy, Richard Jones Jr.); effective: April 2026. - Water ordinance (Section 15-319): moved by Commissioner Todd Rowland; seconded by Commissioner Clint Bundy; outcome: approved 5-0 (all commissioners and mayor); effective: April 2026. - Wastewater ordinance (Section 15-507): moved by Commissioner Todd Rowland; seconded by Commissioner Bob Boltz; outcome: approved 5-0 (all commissioners and mayor); effective: April 2026.

The Commission directed staff to continue providing information to the public about the drivers of rate changes and the timeline for KMW expansion infrastructure. City Manager Hutcheson reported that the city's combined utility-rate impact across electric, water and wastewater for the average city residential customer is a 14.1% increase, equating to about $22.62 per month on average (seasonality may change the dollar amount in specific months). The meeting record notes staff will revisit rates once permanent bond debt service is determined in 2028.