One Sioux Falls: Leader presents proposed changes to utility rates

SIOUX FALLS, S.D. (Dakota News Now) - The City of Sioux Falls is proposing rate increases to four of its five utilities.

The areas that will be affected are water purification, water reclamation (sewer), storm drainage, and sanitary landfill.

The fifth utility — light and power — does not have a proposed rate increase.

According to officials, the proposal is for a four-year period, from 2024 to 2027.

“The City of Sioux Falls prides itself in providing safe and reliable utility services at the lowest possible cost for customers,” said Director of Public Works Mark Cotter. “Based on a thorough analysis and modeling of anticipated costs in the years ahead, the proposed rate adjustments are the minimum revenue requirements to keep our utilities fully functional and to provide the same level of service our community deserves and expects.”

“Regular rate reviews are critical for two reasons,” Cotter said. “First, to protect customers’ expected level of service by ensuring revenues meet service costs; and second, to prevent delayed and sporadic reviews that often result in moderate-to-high rate increases for customers.”

Utility rates

The City of Sioux Falls provided the following details about rate changes:

Water purification

· The Water Purification Division collects, treats, and delivers drinking water to all Sioux Falls residents.

· Proposed rate increases: 6 percent in 2024; 5 percent in 2025; 4 percent in 2026; and 4 percent in 2027.

· Monthly cost increases for the average residential customer, based on 5,200 gallons per month: $1.73 in 2024; $1.58 in 2025; $1.34 in 2026; and $1.34 in 2027.

· This is charged via a monthly bill to customers. Customers can have some control over their water bill by limiting water usage.

· Primary reasons for a rate increase: water purification plant improvements, water main transmission system improvements, and source water expansion via Lewis and Clark Regional Water System.

Water reclamation (sewer)

· Water reclamation collects and treats wastewater from Sioux Falls and regional customers and returns it to the Big Sioux River, meeting federal and state regulations.

· Proposed rate increases: 6 percent in 2024, 6 percent in 2025, 5 percent in 2026 and 5 percent in 2027.

· Monthly cost increases for the average residential customer, based on 4,600 gallons per month: $2.29 in 2024; $2.37 in 2025; $2.14 in 2026; and $2.22 in 2027.

· This is charged via a monthly bill to customers and tied to water usage, which gives customers some control over their monthly bill.

· Primary reasons for a rate increase: improve system capacity, expand for growth and development, and replace and rehabilitate existing infrastructure.

Storm drainage

· Storm drainage consists of infrastructure, like storm drains, pipes, and drainageways, to protect people and property from damaging floods or excess water.

· Proposed rate increases: 4 percent in 2024, 4 percent in 2025, 4 percent in 2026 and 3 percent in 2027.

· For the average property owner, based on a 7,500-square-foot residential property, the monthly cost increases are: $0.20 in 2024; $0.21 in 2025; $0.22 in 2026; and $0.18 in 2027.

· Storm drainage rates are charged annually via a special assessment on county property taxes. These rates apply to property owners only.

· Primary reasons for a rate increase: improvements to drainage in existing areas, regional drainage improvements like the Southwest Sioux Falls Project, and regional ponds along Veterans Parkway.

Sanitary landfill

· The Sioux Falls Regional Sanitary Landfill serves Sioux Falls and five counties, including Minnehaha, Lincoln, McCook, Turner, and Lake.

· Proposed rate increase per ton of municipal solid waste: $2 in 2024; $1.50 in 2025, $1.50 in 2026; and $1 in 2027.

· Rates for the landfill are charged per ton and per visit.

· Primary reasons for a rate increase: maintain and replace equipment, improve Household Hazardous Waste Facility, and design and construct cell #5, a waste-holding basin within the landfill.

City Light and Power

The City is not seeking rate increases for light and power.

The City will bring the proposal to City Council for a first reading on June 6. After a second reading and approval by the City Council, the updates would go into effect on January 1, 2024.

For more information, visit siouxfalls.org/rates.

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