CAVE CREEK – On June 15, 2020, the Cave Creek Town Council voted to approve an increase in water and wastewater rates for the first time in over a decade. This was based on recommendations from a three-year professional rate study, the Town's Water Advisory Committee and the Town Manager’s Rate Advisory Committee.
The new rates went into effect on July 16, 2020, and customers have seen the increases beginning in their August bills.
Why does the Town need to increase water and wastewater rates?
Water and wastewater rates are based on the cost to maintain and operate these vital systems. Since the Town last adjusted the rates in 2009, the operational cost of running the systems has increased greatly. Just the cost for the Town’s raw water from Central Arizona Project (CAP) has increased 135 percent between 2008 and 2018.
In general, the Town’s water and wastewater systems also have extra operational challenges not seen in other utility systems.
- We pump our CAP water supply 12 miles uphill to our water treatment plant
- Our systems have a small number of connections and large service areas.
Due to our topography, we must repump the water into multiple pressure zones
In addition, the town’s water and wastewater infrastructure is aging and requires preventative maintenance funding to ensure reliability. There are several large capital projects underway, such as upgrades to the four booster stations on the Town’s CAP pipeline and improvements to our water treatment plant that will cost millions of dollars to complete.
The existing water and wastewater rates did not fully cover operational expenses, capital expenditures or debt services on the systems. For several years, the Town has been subsidizing the operational expenses of the Cave Creek and Desert Hills’ Water Systems.
The new rates will start to fix the need to subsidize the operational expenses, but it will not totally correct the issue. In 2020-2021 budget, Cave Creek is still contributing $1.25 million to the Cave Creek Water System to help reduce the impact of the rate increase on customers.
The new rates will have the same five usage tiers for all meter type and sizes. To further encourage water conservation and to help offset operational expenses, the cost steps have increased between the usage tiers. That means the more water you use the more expensive it becomes. Customers using less than 10,000 gallons per month should only see a minor increase in their water bills.
Now that the rate increases are in effect, the Town will continue to assess options for revenue and expenses in future years for both of the water and wastewater systems. Staff will continue to look for ways to reduce costs and make the utility systems more reliable.
To view the new water rates please visit the Town’s website. The Town also encourages its customers to subscribe to its utility alerts and email lists.