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Council reviews revisions to pressurized irrigation shareholder agreement ahead of July 28 vote
Summary
American Fork staff proposed formalizing a longstanding 50/50 shareholder arrangement and a new base-rate structure for pressurized irrigation as the city implements state-mandated metering; Council asked for more billing scenarios and scheduled the item for July 28.
American Fork City Administrator David Bunker told the City Council on July 7 that the discussion would focus on how the city's longstanding shareholder discount and rental agreements relate to the Utah Legislature's 2022 House Bill 242 metering mandate, noting the state provided grant funding to cover meter installation.
Bunker explained the proposed revisions mainly clarify existing practice, including a formal statement that one-half of an irrigation share (1 acre-foot) is credited to the city as compensation for conveying and distributing pressurized irrigation water. "The arrangement has always operated as a 50/50 split between the city and the shareholder," he said, framing the amendment as a memorialization rather than a new policy.
The proposal separates two components: (1) a conveyance credit—one-half acre-foot per share dedicated to the city—and (2) a base rate intended to recover system operation and maintenance costs. Staff described a base rate calculated by property square footage; qualifying shareholders would pay one-half of the standard base rate and receive a Tier 1 water allocation based on the shares they own. Ms. Anna Montoya, Finance Director, explained that the existing billing system already applies proportional reductions for shareholders and that proposed tiered usage rates would allow shareholders to apply their owned acre-feet toward consumption before incurring usage charges.
Council members sought clarity on implementation and impact. Council Member John and staff noted Bowen Collins & Associates recommended roughly a 12% increase to irrigation rates and emphasized that while grants covered meter installation, the City is responsible for ongoing meter operations, maintenance, and replacement costs. Staff were asked to return with approximately 15 customer scenarios showing how the proposed rate structure would affect different shareholders before Council action were scheduled for July 28.
