PUD Water & Wastewater Rate Study Underway
PUD commissioners did a deep-dive into a cost-of-service study for water and wastewater rates during a special meeting of the Jefferson Public Utility District commission on December 2nd.
The last combined water and wastewater cost of service study was completed in 2021. The current study revealed existing rates and revenue from water and wastewater accounts are insufficient to fund ongoing operation and maintenance (O&M) and future capital project needs.
The PUD provides water service to more than 5,200 customers countywide and approximately 400 wastewater customers.
According to analysis presented by the FCS Group, rates will require a multi-year combination of adjustments to base fees and consumption fees, as well as leaning on borrowing to bridge the estimated $20.7M needed for future capital projects through 2030.
Water and wastewater services were reviewed independently for clarity, though currently the budgets for water and wastewater services are consolidated under the PUD’s Water department. Assessing the services separately meant a shift from traditional rate studies. A goal for the new rate period was reduction of water customer subsidies for wastewater services. Further, waste water service rates–which differ across three customer groups: Standard, Beckett Point, and Kala Point–were consolidated into a single-cost charge, since the systems are similar and require similar maintenance and refurbishment activities.
Proposed Rate Adjustments
Wastewater rates have not been updated since 2022, when the PUD Board paused the previously adopted 2021 rate schedule. For the current 5-year service study, the commission opted for a gradual phase-in approach that applies an annual adjustment to the wastewater base charge, ultimately standardizing the rate across all customer categories. The proposed unified wastewater base rate of $84.71 would take effect in 2026 to address equity and ensure that each customer class pays its fair share of an anticipated $280k in capital improvements through 2030.
Water services would see a 5% base rate adjustment. For a standard residential 5/8” water connection the rate would change from $42.61 to $44.74 in 2026. A slight increase in consumption charge was also presented. The consumption charge also varies and is based upon the total gallons used by the service in a given month.
Next Steps
The new rate structures align more closely with true cost of service and ensure that both water and wastewater utilities operate without cross-subsidies in the long term while distributing service costs more fairly, helping prevent sharp or unpredictable bill increases in future years.