To Our Valued Customers,
As we finalize the 2024 budget, and with inflation on all our minds, we recognize that you may have questions about the impact of the 2024 rates and fees and about how Parker Water & Sanitation District (PWSD) determines them. With that in mind, below are the details for the 2024 budget along with some basic principles and information that offer background into how PWSD makes these decisions.
In 2024, PWSD will be applying a 0.7% increase to our water rates, a 2.5% increase to our wastewater rates, and a new $1.50 monthly fee to help cover costs associated with the Platte Valley Water Partnership. This will equal an average increase of $3.48 per month for our typical residential customer's bill.
For perspective, the Denver metro area is seeing an average water rate increase of 5.09% and an average wastewater rate increase of 6.86% for 2024, putting PWSD’s increases well below the average increases for the area.
We will also be reducing our total mill levies from 7.698 mills to approximately 6.134 mills, dependent on final property valuations from Douglas County. Assuming all of these changes, the average PWSD residential customer will see a net increase of approximately $18.75 in their total annual costs associated with PWSD.
When making a recommendation to the PWSD Board of Directors for these adjustments, staff keeps the following principles in mind:
- First and foremost is the need to focus on maintaining a long-term and sustainable water supply.
- It is necessary to meet all federal and state water and wastewater regulations.
- We need to maintain our water quality while continuously looking for improvement.
- To be competitive, we must provide appropriate salaries, benefits and work environments for our skilled staff.
When reviewing the staff’s recommendations, the PWSD Board of Directors operates on several basic principles:
- Growth pays for growth.
- For instance, new tap fees are dedicated to corresponding growth needs. Tap fees will be increasing 7.4% in 2024 to support new growth.
- Rate adjustments will be moderated to the Consumer Price Index (CPI). The CPI is maintained by the U.S. Bureau of Labor Statistics to measure the average change over time in the prices consumers pay for goods and services.
- For reference, the CPI for the last 11 years in the Denver/Aurora area has increased 35.6%. During that same period, PWSD’s rates have increased 30.7%.
- Water is a finite commodity that requires decades-long planning and large investments.
In addition to these guiding principles, there are some main categories of expenditures that need to be examined annually to determine the budget and any recommended rate or fee adjustments.
Operations & Maintenance: These are the daily costs associated with purifying and delivering drinking water to your home or business and treating wastewater (i.e., keeping our organization running on a daily basis). Examples include electricity, chemicals, fuel, wages and a portion of debt service. Since 2021, our O&M costs are up approximately 42%, primarily due to inflation in the costs of labor, materials, goods and services.
Capital: These are costs associated with acquiring or maintaining fixed assets such as water storage tanks, treatment facilities, pipelines, wells and equipment. These projects may be deemed necessary because of new regulatory requirements, system growth, water quality needs, etc.
In 2023 alone, PWSD completed the construction of a new 5 million gallon water storage tank, installed filtration at one of our well houses, constructed a much-needed new headquarters building, and purchased land as part of our Platte Valley Water Partnership long-term water plan. Many of these projects were paid for utilizing system development fees received from new growth. Where possible, we have purchased materials for these projects early in order to lock in prices and combat inflation and supply chain issues.
Growth: Most of PWSD’s growth costs fall under capital expenditures, as new infrastructure must be built to accommodate our growing communities. Growth has recently started to slow due to market conditions, which may make it possible to defer some projects in the short-term.
Debt: As mentioned above, debt service falls under our O&M costs. As an example, in 2022 PWSD was able to leverage our AA+ bond rating to secure a low interest rate of 2.89% on a 30-year bond sale shortly before inflation caused rates to increase. This will help us work to minimize any rate adjustments.
We are always looking for ways to responsibly reduce our costs, while also making sure that we can continue to provide high quality water and wastewater services.
Thank you for being a PWSD customer.