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ITEM #: 9.
DATE: 12/15/2025
AI #:2873

CITY COUNCIL ACTION REPORT

SUBJECT:

RESOLUTION ADOPTING A FOUR-YEAR WATER, WASTEWATER, AND SOLID WASTE RATE PLAN

STAFF PRESENTER(S):

Ryan Bittle, Finance Manager

SUMMARY

Conduct a public hearing on Resolution No. 2025-2499 and consider adoption of a four-year Water, Wastewater and Solid Waste rate plan (2026-2029).

STRATEGIC PLAN ALIGNMENT

RECOMMENDATION

ADOPT RESOLUTION NO. 2025-2499 ADOPTING THE PROPOSED FOUR-YEAR WATER, WASTEWATER AND SOLID WASTE RATE STRUCTURES AND PROVIDING FOR EFFECTIVE DATES. (Ryan Bittle, Finance Manager)

FISCAL IMPACT

The proposed four-year rate structure will allow the city to fund operations, capital projects, debt service, and all other costs of service associated with providing water, wastewater, and solid waste services. The FY2026 adopted budget is based on the current five-year rate plan which ends in December 2025.

BACKGROUND AND PREVIOUS ACTIONS

Utility Rate Study

Rate studies are conducted in order to develop a plan or framework to obtain the revenues needed to fund city utility operations while at the same time minimizing the impact of any adjustments on ratepayers. A rate study provides information to citizens and the Council regarding the impact of policy choices on ratepayer monthly bills and the utility's financial health. The city currently has fees in place to support the city's Water, Wastewater, and Solid Waste utility programs and services.

Willdan Financial Services, who has provided financial, rate, and capital planning solutions for communities nationwide for over 30 years, performed the city’s utility rate study. Objectives of the rate study included analyzing and making recommendations for rate adjustments, fees, and charges for Water, Wastewater, Solid Waste, and Stormwater utilities to obtain revenues needed to fund operations, maintenance, debt service, asset replacement and capital projects that are not supported by development fees or developer contributions. Willdan finalized its rate studies for Water, Wastewater, and Solid Waste Attachments B & C.

Citizen Water Advisory Committee (CWAC)

Council adopted Resolution No. 2025-2449 and Resolution No. 2025-2450 on February 24, 2025 amending the CWAC's bylaws and temporarily assigned the CWAC to review and provide recommendations on Solid Waste rates, in addition to its existing duties. This Committee helps to ensure the interests of the city’s customers are represented during the rate-setting process. The Committee of volunteers is composed primarily of city of Goodyear residents living within the city’s utility service areas or business representatives that are impacted by Goodyear's systems. The Committee met five (5) times from April 2025 through September 2025 to learn about the city's utility systems, operations, and challenges, including key factors impacting future rates such as debt service, capital needs, and ongoing costs to maintain city infrastructure. In September 2025, the CWAC members voted to recommend increasing Water, Wastewater, and Solid Waste rates, including the addition of a new Stormwater fee , through a four-year rate plan, by a 4-2 vote. This recommendation was subsequently shared with City Council, and at the November 17, 2025 Council meeting, two members of the CWAC spoke on its recommendation.

City Council

Goodyear City Council met with city staff on several occasions to discuss the proposed Water, Wastewater, Solid Waste, and new Stormwater fee rate plans. Topics discussed included, but were not limited to, the city's existing utility system components, cost drivers impacting the proposed rate increases, compliance with Goodyear financial policy, the impact of the proposed increases on typical rate payers within the system, as well as how city of Goodyear rates compare to other cities around the valley. At the October 21, 2025 Council Retreat, Council provided guidance to remove the new Stormwater fee from consideration, which reduced the scope of the rate-setting process to only Water, Wastewater, and Solid Waste rates. As part of each of these conversations, staff fielded questions from Council and shared various challenges impacting rates including the makeup of the city's water portfolio, the quality of groundwater and cost of treatment, as well as geographical limitations impacting the placement of infrastructure, all of which impact the way the utilities operate. Staff shared that an important philosophy of operating the city's utilities is the concept of growth paying for growth and staff confirmed that impact fees and developer contributions were being utilized in the proposed four-year plan in an effort to limit the impact of operations on rate payers.

Statutory Compliance

A.R.S. §9-511.01 requires that for any proposed increase in Water or Wastewater rates or rate components, fees, or service charges, the city must adopt a notice of intention and file a written report with data supporting the increase in the Clerk’s Office at least sixty (60) days prior to a public hearing. On September 22, 2025, Council adopted a notice of intent and set December 15, 2025, as the public hearing date which began the state required public process for the adoption of all proposed rates and fees. The adopted notice of intent was posted on the city’s website on September 25, 2025; a copy of the full rate study, including cash flow projections, was posted to the city's website on October 31, 2025; and a copy was filed in the Clerk's office on November 6, 2025; all at least thirty (30) days before the public hearing. Notice of intent to increase rates was subsequently published in the Arizona Business Gazette - Republic Edition newspaper greater than twenty (20) days before the public hearing date. The city is in compliance with all additional requirements as outlined in A.R.S. §9-511.01 not otherwise mentioned.

Customer Outreach
The city has taken additional steps above those required by state statute to notify and engage the public during the rate-setting process. Those actions taken are listed below:
- Involvement of the CWAC from April 2025 to September 2025;
- Three (3) public discussions with City Council on proposed rate increases: September 15, 2025, Work Session, October 21, 2025, Council Retreat, and the November 17, 2025, Council Meeting;
- Notice to customers of the proposed rate increases on utility bills in November 2025 and December 2025;
- Notice to customers of the proposed rate increases via the city's various social media channels;
- A frequently asked questions flyer posted both on the city's website and shared via social media; and
- An article in the city's December 2025 InFocus magazine on the recommended rate increases.

STAFF ANALYSIS

The last modification to the city’s utility rate structure was a five-year plan adopted on January 25, 2021, which included rate increases implemented every January from 2021 through 2025. The current proposed plan is anticipated to be effective no earlier than thirty (30) days after adoption of Resolution No. 2025-2499, included as Attachment A.

Proposed Rate Plan:

Average customer bill and impact under the newly proposed four-year plan

Residential	2026	2027	2028	2029	Avg Monthly Usage
Water	$2.71	$2.90	$3.09	$3.30	7,500 gallons
Wastewater	$3.97	$4.18	$4.41	$4.66	6,000 gallons
Solid Waste	$1.82	$1.97	$2.13	$2.30	flat fee
TOTAL MONTHLY BILL IMPACT*	$8.50	$9.05	$9.63	$10.26
TOTAL MONTHLY BILL*	$155.48	$164.53	$174.16	$184.42
% Increase to Monthly Bill	5.8%	5.8%	5.9%	5.9%

*Based on average customer usage. Water & Wastewater rates are only applicable to Goodyear residents south of I-10.

Average customer bill and impact under the newly proposed four-year plan

Commercial	2026	2027	2028	2029	Avg Monthly Usage
Water	$35.86	$38.28	$40.86	$43.62	65,000 gallons
Wastewater	$23.97	$25.52	$27.17	$28.92	48,000 gallons
Solid Waste	-	-	-	-	n/a
TOTAL MONTHLY BILL IMPACT*	$59.83	$63.80	$68.03	$72.54
TOTAL MONTHLY BILL*	$964.72	$1,028.52	$1,096.54	$1,169.10
% Increase to Monthly Bill	6.6%	6.6%	6.6%	6.6%

*Based on average customer usage. Water & Wastewater rates are only applicable to Goodyear commercial customers south of I-10. Solid Waste fees are not currently charged to commercial customers.