Eloy City Council Work Session: Water/Wastewater Rate Study – April 28, 2025
Eloy City Council Work Session: Water/Wastewater Rate Study – April 28, 2025
The City Council held a work session on Monday, April 28, 2025, at approximately 5:00 PM to receive a presentation from Dan Jackson, Vice President of Willdan, on the recently completed water and wastewater utility rate study. The presentation outlined current financial status, projected infrastructure needs, and four rate increase scenarios tied to different levels of capital improvement debt.
Discussion Items
- Dan Jackson presented findings of the 2025 rate study update, noting that capital improvement costs have risen significantly since the 2022 rate plan. The study assumes conservative growth of 50–60 new accounts per year and forecasts $95 million in water and sewer capital needs over 5–10 years.
- Four financing scenarios were presented: Scenario 1 ($13 million in new debt) would keep the existing rate plan (11% increases in 2025 and 2026, then 9% in 2027, 3% in 2028–2029). Scenario 2 ($23 million debt) would require water increases of 13% for three years. Scenario 3 ($33 million debt) would require water increases of 14% in 2025–2026, 12% in 2027, 10% in 2028, and 6% in 2029. Scenario 4 ($63 million debt) would require 18% water increases for three years. Wastewater rates would remain at 11% in 2025–2026 and 11% in 2027 under all scenarios except Scenario 4.
- Staff clarified that the $13 million debt in Scenario 1 aligns with the current rate plan and is already programmed in the FY 2025-26 budget. Additional debt scenarios would fund new tanks, water line expansions, replacement of 60–80-year-old lines, and infrastructure for growth (e.g., Esperanza development on Battaglia Road).
- Matt Mellow, Public Works Director, noted that Eloy remains in MDOS status with ADWR (Arizona Department of Water Resources), which considers financial commitment and CIP as key factors in maintaining the 48,000 acre-foot allocation. Robust rate plans showcase the city’s ability to serve current and future customers.
- Councilmember Curtis questioned why the presentation used 5,000-gallon usage instead of the city average of 7,500 gallons. Jackson acknowledged the point and said future presentations would use 7,500 gallons.
- Councilmember Galindo (excused, but sent a comment) expressed concern about affordability for long‑term residents, emphasizing that Eloy’s low cost of living is a key attraction.
- Discussion also covered water sales to Surprise, Arizona; staff are evaluating a potential rate increase for that agreement, which currently nets no profit for Eloy.
Key Outcomes
- No formal action was taken; the work session was for presentation and discussion.
- Staff will bring back a resolution for a Notice of Intent to adjust rates, following ARS 9-511, which requires a public hearing 60 days after the notice.
- Council provided guidance to consider Scenario 2 or 3 for further review, balancing infrastructure investment with ratepayer impact.
- The study and rate plan options will be presented again at a public hearing before final adoption.
Meeting Transcript
All right, thank you. Not yet. Someone calling it? I thought that the guy heard where I have said that. Like that picture of the city hall. I took that picture myself. Other cactus is there. Yeah. Oh text message. Hello, lady. Good evening. No. Hi, good evening. Welcome to the Eloy City Council work session. The date is Monday, April twenty eighth. Time is approximately five PM. Madam Clerk, may I have a roll call, please? Councilmember of Altraska. Here. Councilmember Curtis. Here. Vice Mayor Tarango. Here. Councilmember Schneider, excused. Councilmember Garcia, excused. Councilmember Galindo, excused. Mayor Sutton. Here. Thank you. At this time I'd like to stand for the Pledge of Allegiance. One nation under God, individual with liberties and justice for all. Okay, do we have any unscheduled public appearances? Okay, item number five on discussion items. I'm looking for a Dan Jackson. Hi, Dan. Oh, Brian. Good evening, Mr. Mayor, members of the council. Um tonight, uh Dan Jackson is here from Will Dan to present the council with a um a rate study for water and wastewater. Uh this presentation this uh rates study back in um it was September 2024. We brought it to council to um initiate the contract with uh Will Dan. At that time, back in about two thousand twenty-two when the council adopted the water wastewater uh five year rates study. Uh council at the time directed staff to uh do like a little mid-view review to make sure rates were meeting the marks of everything. So that's how we came to the point of getting uh Will Dan to come back out and do a uh rate study. And upon this rate study tonight, what you'll hear for this workshop is um kind of where we're at um the how the rates are looking, how it's compared to other communities, um, really diving into our capital improvement plan when it when our how our rates are gonna be looked at. Four scenarios are presented to council tonight. Um, and so he'll go over each of those. Um staff is here to address any of the questions that uh Mr. Jackson may not have, but at this time, just uh without further ado, I'll let uh Dan begin the rates study on this, the presentation. Thank you, Mayor, members of the council.
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