Boulder water study projects $14.8 million gap, models 7.5% annual rate increases

Boulder’s preliminary water-rate study projects a $14.8 million revenue shortfall in fiscal 2031 under current rates and models annual increases of about 7.5% from fiscal 2028 through 2031, consultants told the Water Resources Advisory Board on Nov. 9. The increases are a scenario for discussion, not an adopted rate plan.

The model uses fiscal 2031 as its cost-of-service test year. It includes a 5% rate increase already approved for fiscal 2027, about $164 million in capital spending from fiscal 2027 through 2031, and a $47.1 million bond issue in fiscal 2028. Staff said capital plans and other assumptions could change.

The study also compares possible rate structures. Staff’s preliminary approach is to retain water budgets, with adjustments, for single-family homes and dedicated irrigation accounts, while simplifying rates for commercial and multifamily customers. Under the single-family option, the monthly indoor budget would fall from 6,000 to 5,000 gallons, and outdoor allocations would be adjusted using lot size and updated seasonal factors.

Modeled bill effects vary. Presenters said most single-family customers would see some decrease, especially those staying within their water budgets, while some who exceed their budgets could pay more. One example showed a customer using 7,000 gallons a month with a modeled bill about $5, or 7.8%, lower; the customer’s water budget would drop from 12,700 to about 10,600 gallons. These are comparisons between rate scenarios, not predictions of individual customers’ final bills.

For commercial accounts, the study showed a median modeled bill reduction of about 4%, but staff said roughly 2% of accounts could face increases above 30% and were still under review. About half of multifamily accounts were modeled to remain within 5% of the comparison bill. Staff also said they were continuing to examine accounts with unusual needs, including urban agriculture users.

The advisory board took no action on rates at the Nov. 9 meeting. A board recommendation and City Council consideration remain ahead. The city says it will continue gathering customer feedback into early 2027 to refine options; its rate-study explanation says current rates are expected to remain in place through 2027 and any approved changes would take effect in 2028.