Tag Archives: water rate

CHARLOTTE WATER 2024 RATE ADJUSTMENT

Taken by Cam Coley, employee City of Charlotte, Charlotte Water

Charlotte is a rapidly growing city, in an equally rapidly expanding region. Investments in vital resources and infrastructure will not only support that growth but allow everyone to have a quality of life that is only capable through access to a safe, clean and reliable water system. Each of the 1,200 Charlotte Water system employees work hard to support that vision. Charlotte Water does this by increasing capacity through improvement and enhancement projects and by working 24/7/365 to maintain, repair and replace foundational infrastructure across the region.

Why are Water Rates Increasing?

Charlotte Water is legally required to operate as a “cost-of-service provider.”  This means, as a utility, CLTWater must strictly use fees and rates to support, maintain and grow the water system. That requires us to operate as good water stewards and as a business operation that does not make a profit, but also can not legally operate at a loss.

Charlotte Water does not use property tax or sales tax to operate or fund capital improvements. The Charlotte Water system is supported entirely by water and sewer rates and fees paid by customers. Each dollar in rates has a specific purpose in how it goes to work in the water system. These rates allow Charlotte Water to:

  • Provide clean, safe and reliable drinking water
  • Maintain more than 9,000 miles of water and wastewater pipes
  • Rehabilitate, replace, and invest in aging infrastructure
  • Exceed regulatory requirements
  • Support regional growth
  • Safely transport and treat wastewater

To achieve this, each year, Charlotte Water systematically evaluates its existing infrastructure, upcoming capital needs (such as capacity), and other industry and economic variables. This helps determine if a rate adjustment is necessary. Potential adjustments are presented to the City Council, explaining how each dollar will be used and where it will go. If City Council approves, the new rates typically go into effect in July of that year.  “FY,” or fiscal year, is identified as July of the current year into June of the following year.

For FY2024, (July 2023- June 2024) Charlotte Water rates will increase an average of 4.25% , which equals approximately a $3.10 monthly increase for average Charlotte Water residential customer bills.

To learn more about the 2024 rates and fees, visit our webpage.

How are Rate Adjustments Decided/Calculated?

CLTWater uses a nationally-recognized rate consultant to evaluate and audit our rate model. This complex model uses many variables, such as regulatory, personnel, industry costs, etc., to create a ten-year projection.

Capital Improvement Plan

A large part of rates are used towards investing and funding Charlotte Water’s Capital Improvement Projects (CIP). Each year, CLTWater identifies and prioritizes several projects that are needed within a five-year period. Projects selected must meet certain requirements, such as fulfilling capacity needs, supporting future development, or improving the quality of life for the community.

The goal of the CIP is to:

  • Line up with CLTWater’s Mission and Vision to serve customers
  • Identify the right projects
  • Identify the funding needs
  • Maintain consistent annual funding levels
  • Ensure financial viability
  • Balance our goals against supporting municipal vision plans, economic development and regulatory requirements

For the fiscal year 2024-2028, CLTWater plans to invest $2.63 Billion back into the community’s utility. The investment can be broken down into key groups:

Capacity for Growth
$1.5B to expand and upsize pipes and plants to maintain service for a growing community

Rehab and Replacement
$645M to replace some of the oldest infrastructure

Regulatory Requirements
$279M to complete projects related to new state or federal regulations

Commitments to Public Projects
$115M to relocate pipes before NCDOT, City of Charlotte, or town-funded projects

Utility Support
$70M towards advancement in technology, security and updates to current facilities

Lawsuit Settlement Update

Charlotte Water previously shared with media and customers that a recent lawsuit settlement would impact the CIP program and possibly lead to a higher-than-normal rate adjustment in July. (You can learn more by reading the blog article here.)

Since January 2023, Charlotte Water restructured the Capital Improvement Plan (CIP) to instead absorb the lawsuit damages. This means the settlement costs will not be passed along to customers as previously proposed.

FY 24 Industrial Sewer Rates

CLTWater recently worked with a utility consulting firm to complete a rate study and better understand our rates and cost of treatment.  During the evaluation, we learned some of the industrial sewer rates had not been updated since 2011. This meant a rate recovery was needed for:

  • increased costs of treatment
  • treatment plant improvements
  • operational costs and program costs

Industrial Fees are different than regular customer sewer rates because industries usually have different/stronger compositions of certain chemicals.  Treatment plants are designed and regulated for domestic (residential) strength wastewater.

Each industry/business is unique in its usage and discharge. For most commercial and utility users, your bill is calculated based on how much water you use and your wastewater composition. In general, the more you use, the more you pay. For monitored industries, the higher the concentration of chemical oxygen demand (COD), total suspended solids (TSS) or ammonia discharged, the more you will pay.

Non-monitored industries, e.g., breweries and restaurants, incur the high strength volume charge.

To mitigate the impact of the rate recovery, rates are proposed to increase in three phases:

  • July 1, 2023
  • January 1, 2024
  • Incremental increases annually expected to start July 1, 2024

To learn more about the different industrial and commercial rates, view these one-pagers below.

Charlotte Water Cares

CLTWater is always looking for ways to connect customers to resources and available financial aid programs. We work closely with several community partners, including Crisis Assistance and the Department of Social Services, to connect residents to resources. Learn more about our “Dream Team” by reading our blog article.

Financial assistance is available for families in need. Charlotte Water encourages customers to contact 3-1-1 or visit charlottewater.org to learn more about the many financial assistance programs available.