The city's previously adopted five-year rate plan for water, wastewater, and solid waste rates expires at the end of calendar year 2025. These are the rates that appear on the monthly city services bill for residents and businesses.  With the upcoming expiration, there was a need to conduct a new study for these rates, and to evaluate the need for potential rate increases and adoption of a new multi-year rate plan. 

In addition to evaluating rates for water, wastewater, and solid waste, as prescribed in the city's strategic plan, city staff also conducted a study examining the potential of adding a new stormwater fee. Each of these four city utility program recommendations are a result of over six months of analysis, assistance, and communication between city staff, our Citizen Water Advisory Committee (the Committee), and Willdan Financial Consulting.

Following a comprehensive review of the rate programs, the Committee, Willdan Financial Consulting (Willdan), and city staff all came to the conclusion that rate increases are needed to cover the cost of projected expenditures and maintain the long-term sustainability and reliability of the city's utility services and programs. The resulting recommendations were discussed with Council during the October 21, 2025, Council Retreat. As part of that retreat, Council consensus was reached to not proceed with implementing a new stormwater fee.

This report provides an overview of the rate setting process; the proposed rate adjustments for water, wastewater, and solid waste; and the recommended four-year rate plan for water, wastewater, and solid waste rates. The city’s process followed all required statutory timelines, including public notices with an opportunity for community input on the proposed rates. The following is a summary of the public process, including a public hearing scheduled on December 15, 2025, for Council to consider adoption of the proposed utility rates.

April 9, 2025	Committee Rate Study Kickoff
May 14, 2025	Committee Water & Wastewater Rate Discussion
June 11, 2025	Committee Solid Waste & Stormwater Rate Discussion
August 20, 2025	Committee Rate Presentation
September 10, 2025	Committee Formalized Rate Recommendation
September 15, 2025	Council Work Session on New Proposed Stormwater Rate
September 22, 2025	Adopt Notice of Intent and set a Public Hearing date
October 21, 2025	Council Retreat Presentation on Overall Rate Study
November 14, 2025	Public hearing notice for the December 15 meeting was advertised in the newspaper and city website
December 15, 2025	Public Hearing at Council Meeting
January 2026	New Rates Reflected on Utility Bills

There is no direct fiscal impact associated with this item as it is for discussion only. 

However, based on the information contained in this report, the proposed four-year rate plan would provide on average $53.3M in annual rate revenue for the city's water utility, $32.3M in annual rate revenue for the city's wastewater utility, and $12.5M in annual rate revenue for the city's solid waste utility. A public hearing on proposed utility rate increases is scheduled for December 15th, 2025.  If approved, the new four-year rate plan will be utilized as guidance for the upcoming budget development processes.

Rate Evaluation and Setting Process:
The city currently has fees in place to support the city’s water, wastewater, and solid waste programs and services. The city contracted with Willdan to perform a rate study on the city's water, wastewater, solid waste, and stormwater programs. Willdan’s work spanned a six-month period and required substantial input and continuous support from the Water Services, Public Works, and Finance departments, as well as the City Manager's Office to gather information, create forecasts, and discuss various scenarios.

The components of Willdan’s completed rate study (Attachments A, B, and C) provided a final recommendation that was shared with and approved by the Committee. The financial plan included in the study is in compliance with City of Goodyear financial policy.  Each utility is self-sufficient within the rates being recommended, and the use of impact fees and developer contributions have been applied where applicable to help ensure growth pays for growth. The combined effort was meant to ensure that the financial impact on rate payers was minimized as much as possible. Costs factored into the study include, but are not limited to, capital projects, debt service, asset replacement, as well as costs to support all ongoing operations.

Citizen Water Advisory Committee:
Council adopted a resolution on February 24, 2025, to assign the Committee with the task of reviewing and providing recommendations on water, wastewater, stormwater, and solid waste rates.  To fulfill this charge, the Committee met five times from April 2025 to September 2025 to receive detailed information about the city's utility systems, and key factors impacting future rates, which were captured as part of the study. The results of the study were presented to the Committee, which voted (4-2) to provide its recommendation to Council to support the proposed rate increases and the four-year rate plan. The Committee provided a memo in support of the proposed increases (Attachment D) and the Committee’s meeting minutes have been consolidated (Attachment E).

Council Retreat:
The Committee's recommendation of a four-year rate plan, and the plan’s associated rate increases were presented and discussed with Council at the October 21, 2025 Council Retreat. The discussion with Council covered the city’s existing utility system components, cost drivers impacting the proposed rate increases, confirmation that the proposed recommendations are in compliance with city's financial policy, and how city of Goodyear rates compare to other city's around the valley. Council consensus was reached to not proceed with implementing the new stormwater fee. Although the city will not be moving forward with the consideration or implementation of a new stormwater fee at this time, Willdan’s study of a stormwater fee is included as Attachment C.

The water, wastewater, and solid waste study as well as the stormwater study are available on the city's website on the Public Notice page here: https://www.goodyearaz.gov/government/departments/finance/user-fees.

Revenues raised by rates over the proposed four-year plan are projected to be as follows:

UTILITY	2026	2027	2028	2029
Water	$46.6M	$50.9M	$55.5M	$60.3M
Wastewater	$28.3M	$30.8M	$33.5M	$36.4M
Solid Waste	$10.6M	$11.7M	$13.1M	$14.5M

Projected Expenditures over the four-year plan are as follows:

EXPENDITURES	2026	2027	2028	2029
Water	$55.3M	$55.6M	$58.8M	$64.9M
Wastewater	$111.0M	$40.3M	$40.7M	$42.1M
Solid Waste	$11.2M	$11.2M	$14.5M	$15.9M

Major cost drivers in the proposed rate plan include:
Capital Spend
     165.0M Surface Water Treatment Plan Expansion
     140.5M Goodyear Water Reclamation Facility Expansion
     34.7M Rainbow Valley Water Reclamation Facility Expansion
     39.8M Solid Waste Operations Yard

Projected additional Staffing Requirements:

Full-Time Equivalent Additions	2026	2027	2028	2029
Water		4.5	3.5	3.0
Wastewater		6.5	3.5	2.0
Solid Waste		2.0	1.0	3.0

Operations Materials needed to repair and/or replace critical pieces of city infrastructure often have long lead times and few suppliers.

Ending Fund Balance above our financial policy reserve requirement is projected to be as follows: 

UTILITY	2026	2027	2028	2029
Water	$15.6M	$16.9M	$17.6M	$16.1M
Wastewater	$23.6M	$15.4M	$10.3M	$6.8M
Solid Waste	$4.6M	$5.2M	$3.8M	$2.5M

   
Increased Revenue Requirements as part of the proposed 4-year plan are as follows:

RESIDENTIAL	2026	2027	2028	2029
Water	6.75%	6.75%	6.75%	6.75%
Wastewater	5.5%	5.5%	5.5%	5.5%
Solid Waste	8.0%	8.0%	8.0%	8.0%

 

COMMERCIAL	2026	2027	2028	2029
Water	6.75%	6.75%	6.75%	6.75%
Wastewater	5.5%	5.5%	5.5%	5.5%
Solid Waste	-	-	-	-

 
A summary of the impact of the proposed rate increases on the average residential and commercial rate payer's monthly bill is shown in the tables below:

RESIDENTIAL	2026	2027	2028	2029
Water	$2.71	$2.90	$3.09	$3.30
Wastewater	$3.97	$4.18	$4.41	$4.66
Solid Waste	$1.82	$1.97	$2.13	$2.30
Total Monthly Bill Impact	$8.50	$9.05	$9.63	$10.26
% Increase to Monthly Bills	5.8%	5.8%	5.9%	5.9%

 

COMMERCIAL	2026	2027	2028	2029
Water	$35.86	$38.28	$40.86	$43.62
Wastewater	$23.97	$25.52	$27.17	$28.92
Solid Waste	-	-	-	-
Total Monthly Bill Impact	$59.83	$63.80	$68.03	$72.54
% Increase to Monthly Bills	6.6%	6.6%	6.6%	6.6%

Average monthly billed usage per City of Goodyear account (in gallons) is shown below:

USAGE	Water	Wastewater
Residential	7,500	6,000
Commercial	65,000	48,000

The next step is to conduct a public hearing set for December 15, 2025 in compliance with ARS 9-511.01. If the proposed rate increases are approved, the new rates will go into effect no earlier than 30 days after adoption.