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Posted on: November 30, 2021

Council Perspective: Tiered water rates encourage water efficiency

Faucet with water running into a kitchen sink

By Mayor Anne Burt

At the end of July, in response to the severe drought conditions, the Minnesota Department of Natural Resources (DNR) issued temporary requirements on local water suppliers to reduce water use in their communities.

Since lawn watering is by far our top water use in the summer months, we decided we could make the biggest impact quickly by elevating our regular time-of-day and odd/even lawn-watering restrictions to trash pick-up day and one weekend day. 

You responded. We estimate that we reduced water use by at least 120 million gallons between when the elevated restrictions were implemented at the end of July through first week of September (based on water usage leading up to the start of the elevated restrictions). I am so proud to be part of a community who rallies together and makes personal sacrifices for the greater community good - what an amazing accomplishment!

While the DNR has since relaxed its temporary requirements and we've returned to our regular lawn-watering restrictions, we may not be out of the woods yet. If drought conditions return next spring, we may have to bring back the elevated lawn-watering restrictions - or some form of them. And even if we don't have to take that dramatic of a step, I encourage you to continue to use water efficiently. One thing you can do (if you have an irrigation system) is order a WaterSense certified lawn irrigation controller through the city's discount program. Learn more about how it can reduce water use and save you money. If you already have one, tell your neighbors, friends and family about it!

Water rates and usage tiers

Speaking of saving money: I've recently heard some concerns from our water customers receiving higher than normal balances on their utility bills. Even with our elevated lawn-watering restrictions, our customers likely used more water on lawns and outdoor activities this summer due to the extreme drought conditions and may have reached a higher water rate usage tier. It may have been a while since many of you reached a higher usage tier in a billing cycle - 2016 and 2019 were two of the wettest years on record, and 2015 and 2017 also saw above average amounts of precipitation. When we have wet years like those, water use for lawn irrigation is greatly reduced and we don't see the impact on our water bills. The most recent quarterly bill is likely reflective of the increased summer water usage through approximately mid-August (depending on when your water meter was read).

It's also important to remember that the city has adjusted water rates and usage tiers multiple times over the years in response to changing conditions and growth in the city. The current tiered structure means the more water we use, the more we pay per 1,000 gallons used over specific thresholds. If you want to save money on your future water bills, keep these usage tiers in mind and look for ways to reduce your water use. Consider scaling back on lawn irrigation next summer. Remember: 1 inch of water per week, including rainfall, is all you need for a healthy lawn!

Utility rate increases proposed for 2022

As our water and sewer infrastructure ages, we are anticipating significant repairs will be needed in the future. Anticipating this need, beginning in 2018, we increased water rates for the first time in a decade and made some additional incremental increases since that time. To continue building this fund, a few additional utility rate increases also are proposed for 2022:

  1. A $1 per quarter increase to the water administrative fixed fee for all water users (see chart).
  2. A 10-cent per 1,000 gallons increase to the water rate for each of the five usage tiers (see chart).
  3. 32-cent increase per 1,000 gallons to irrigation rate for commercial properties and homeowners associations (to support the city's water efficiency and incentive programs). 
  4. A $1.20 per quarter city sanitary sewer flat rate increase for residential accounts (a 45-cent increase for commercial accounts).

Impact of proposed changes to water rate and usage tiers

Tier 1Current$1.60 per thousand gallons from 1,000 to 25,000 gallons per quarter
Proposed$1.70 per thousand gallons from 1,000 to 25,000 gallons per quarter
Tier 2Current$2.60 per thousand gallons from 25,001 to 50,000 gallons per quarter
Proposed$2.70 per thousand gallons from 25,001 to 50,000 gallons per quarter
Tier 3Current$3.60 per thousand gallons from 50,001 to 75,000 gallons per quarter
Proposed$3.70 per thousand gallons from 50,001 to 75,000 gallons per quarter
Tier 4Current$4.60 per thousand gallons from 75,001 to 100,000 gallons per quarter
Proposed$4.70 per thousand gallons from 75,001 to 100,000 gallons per quarter
Tier 5Current$5.60 per thousand gallons for usage exceeding 100,000 gallons per quarter
Proposed$5.70 per thousand gallons for usage exceeding 100,000 gallons per quarter

Utility Bill Comparison (per quarter)

2021 23,000 Gallons125,000 Gallons
Administrative Charge$6$6
Water Tier 1-5 Charges$36.80$450
Sanitary Sewer$29.25$29.25
MCES Sewer Min*$25.18$25.18
MCES Sewer - Tier 1$20.10$20.10

2022 Proposed23,000 Gallons125,000 Gallons
Administrative Charge$7$7
Water Tier 1-5 Charges$39.10$462.50
Sanitary Sewer$30.45$30.45
MCES Sewer Min*$26.75$26.75
MCES Sewer - Tier 1$21.30$21.30

*MCES sewer charges are based on typical household winter average of 14,000 gallons of water use per quarter
**Street Lighting charge and water testing fee collected by the state are not reflected in the examples but are included on quarterly utility bills. These fees are proposed to remain the same for 2022.

Funding water and sewer infrastructure through utility rate increases ensures all municipal utility customers contribute, including places of worship, schools and other non-taxable properties. The tiered rate structure for water also encourages responsible water use by property owners. 

We've been responsible with managing our utility rates. Even with these proposed changes, our rates will keep us in the middle of the pack when stacked up against the rates of our comparable cities in the metro area. While it's difficult to raise fees, even so slightly, sometimes it's necessary to ensure we have the funds available to maintain our critical infrastructure now and into the future. If approved at the Dec. 8 City Council meeting, the new water and sewer rate changes would be effective in 2022. 

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