Salt Lake City Public Utilities is seeking a rate hike, which would make the capital’s sewer fees some of the highest in the Salt Lake Valley and across the West.
Even so, a household’s utility bill would likely go up no more than about a dozen dollars a month — as long as its inhabitants are low or moderate water consumers.
The utilities department says the proposed rate increase of 8% for delivered water, 18% for sewer and 10% for stormwater are necessary to address an over-the-hill water system, including treatment plants that are no longer up to snuff.
“The big deal here for our budget,” said Public Utilities Director Laura Briefer, “is the amount of aging infrastructure we need to address.”
The city’s 50-year-old wastewater treatment plant, in particular, has reached the end of its useful life and needs upgrades to meet new federal standards for nutrients by the 2025 deadline. Construction crews broke ground on the new plant in 2019, and the estimated price tag has jumped from $538 million to $711 million, according to city officials.
“We have been impacted by the rising construction costs,” Briefer said, “but are also incorporating value engineering and possible deferrals of certain elements of the project to reduce construction costs.”
Salt Lake City’s four water treatment plants, its 1,300 miles of pipes as well as the system’s numerous pump stations, dams and wells are also showing their age.
The department plans to spend $39.6 million in the next year on capital projects, including nearly $7.4 million on upgrades at the City Creek, Parleys and Big Cottonwood Canyon water treatment plants. Another $1.4 million is earmarked for Mountain Dell Dam and $1.3 million to improve a water main running along 300 West from 900 South to 2100 South. Another $2.5 million would help replace water meters so they could be read remotely.
“Our infrastructure is out of sight and out of mind until it fails,” Briefer said, “and we never want that to happen.”
That’s why her department is proactive in raising rates, Briefer added. The biggest hike her department is proposing is an 18% increase to wastewater, which would make that utility one of the costliest along the Wasatch Front and in cities in neighboring states like Colorado, Nevada and Arizona.
The expected financial impact for residents ranges from $1.58 for a household with minimal sewer use to $6.32 for a household with medium use and $11.85 for residences with high use, according to a budget presentation to the City Council last month.
The next-biggest increase — 10% for stormwater — would have a barely noticeable impact to residents’ wallets. Homes on less than a quarter acre would see a monthly increase of 55 cents, while bigger lots would see a 76-cent monthly bump.
The 8% spike in delivered water rates would result in about an extra $2 a month on utility bills for households with minimal or low consumption and up to nearly $19 for homes with high water use.
“With my family of four,” Briefer said, “the impact on my monthly bill is between $1.60 and $3.75, depending on how much I use.”
All the department’s proposed increases require approval from the City Council, which is working with Mayor Erin Mendenhall on the 2021-22 budget. The city’s fiscal year begins in July.
Water rates in Salt Lake City typically grow by 4% to 5% a year, Briefer said, but last year the utility department put the increase on pause due to financial uncertainty brought by the coronavirus pandemic. Revenues instead remained steady, so the 8% bump would allow the department to catch up on projects and new hires that were deferred in 2020.
The area’s reputation for cheap water may soon end. All told, Salt Lake City has $756 million in “delayed or unplanned-but-quantified capital needs” in its water utility alone, according to a staff document provided to the City Council.
“We’re looking at a five-year plan for water, so in subsequent years we’re looking at higher increases to really get into the financing strategy,” Briefer said. “Treatment plants, those can cost $100 million to replace.”
In the meantime, the city and its Public Utilities Department are exploring federal assistance as well, including low-interest loans from the Water Infrastructure Finance and Innovation Act as well as new money available through the American Rescue Plan.
“Water systems across the nation,” Briefer said, “are really looking forward to this, having similar needs.”
Editor’s note • May 19, 5:10 p.m.: This story has been updated to include corrected data from Salt Lake City Public Utilities in a chart about annual sewer charges.