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Consultant: Groves must raise water and sewer rates; 5.75% annual increases proposed
Summary
Consultant Matthew Garrett told Groves City Council the city faces about $33 million in capital needs and recommends 5.75% annual water and wastewater rate increases to meet debt-service and operating targets; he presented modeled bill impacts and answered council questions about wastewater costs.
Matthew Garrett, a consultant on Groves’ utility rate study, told the city council on July 13 that projected capital needs and debt service make rate increases necessary.
"Current rates will not meet the plan to support the utility that you need," Garrett said as he reviewed a five‑year capital program that includes roughly $33 million of projects and a $25 million 2026 bond issuance with an anticipated $5.7 million issuance in 2027. Garrett said the plan assumes the city will average a 5.75% rate increase per year and modeled the effect on a typical residential customer using 4,000 gallons: the current bill of $73.25 would rise to $77.44 in the first year under the proposal.
Garrett said assumptions behind the modeling include conservative inflation (about 2.5–2.6%), a 5% salary cost increase and 12% benefits growth for staff, and essentially zero local growth. He explained the city matched debt terms to asset life — shorter notes for short‑lived assets and longer notes for long‑lived assets — to limit 'rate shock.'
During questioning, councilors pressed on why wastewater fees are higher than water charges. Garrett explained wastewater treatment is generally more expensive to operate and treat, and staff confirmed the rate design changes in prior years were intended to bring sewer charges more into line with treatment costs.
The presentation was informational; Garrett and staff said a formal rate ordinance and budget supporting the changes will return to council as part of the upcoming budget process.
What happens next: staff will include the rate design in the fiscal‑year budget package and schedule further review at the budget workshop and subsequent meetings. No rate increases were adopted at the July 13 meeting.
