Met Council proposes wastewater rate increase for 2023

Date: Friday, May 20, 2022

The Metropolitan Council is proposing a 5.5% increase for its regional municipal wastewater charge to cities and townships in 2023. The 111 municipalities served by the regional wastewater collection and treatment system pay the Met Council based on the volume of wastewater they send to our wastewater treatment plants.

For context, the average Twin Cities metro area retail rate for wastewater services is about 35% lower than the average rate that households pay in peer regions throughout the country, according to the most recent data from the National Association of Clean Water Agencies.

“We always seek to maximize value for our customers,” said Ned Smith, director of pretreatment and finance. “We limited our annual municipal wastewater charge increases to 4% or less for five years, including only 2% in 2021. As a result, we believe our customers are better positioned to handle this modest increase necessitated by rising inflation rates, especially in chemicals and utilities.”

Wastewater operations funded entirely by user fees

The Met Council Environmental Services division projects $349.9 million in revenue for 2023, with 75% of it coming from the municipal wastewater charge. Another 17% of revenue is from residences or businesses that pay a one-time fee — the sewer availability charge — to connect to the regional wastewater system. Businesses also pay this fee if they change use in a way that increases demand on the wastewater system.

Municipal wastewater charges are 75 percent, transfer from SAC 17 percent, industrial waste charges 5 percent, other 3 percent.

Nearly half (45%) of the wastewater budget is for debt service, which includes the improvement and expansion of wastewater infrastructure such as sewer interceptor pipes, lift stations, flow meters, and treatment plant upgrades. Salaries and benefits are also significant investments, accounting for 23% of the budget.

“We’re planning to hire a few incremental full-time employees this year, which adds less than one half of 1% to our overall budget,” said Smith. “But we’re running at about 60% of the staff as we did 20-plus years ago. That speaks volumes about how we’ve been able to improve and sustain our operational efficiencies.”

The fee for one SAC unit will remain flat for the ninth consecutive year at $2,485. Other revenue sources include industrial waste charges, grants, use of reserves, and investments.

Graph showing rates from 2022 to 2023. Started at 4.3 percent, rose to a high of 9.6 percent, and has fallen until 0 percent in 2015 and beyond.

Flow volume determines share of municipal water charge

Municipal water charges vary for each local government, depending on the amount of its wastewater flow compared to other municipalities. Allocations for 2023 are based on flow volumes from 2021. For example, a city that accounted for 2% of the overall wastewater volume in 2021 will pay 2% of the overall municipal water charge for the region next year.

Aerial view of clarifying tanks.

Share feedback, shape future decisions at upcoming customer event

Nobody likes surprises when it comes to budgets. That’s why we sent out our preliminary 2023 municipal charges in early May and we’re conducting two customer events — on May 26 and June 7 — so cities and townships have ample time to gather important wastewater information and fee structures for their annual budgets.

Both events will be held virtually and feature key staff from our Environmental Services division. We will share proposed rates, discuss details, highlight changes, and compare strategies for managing rate increases in 2023 and beyond.

Register for one of the events.

Watch a video presentation to the Met Council’s Environment Committee about the 2023 budget concepts, rates, and developments (starts at 59:32).

Posted In: Wastewater & Water

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