Sioux Center wastewater customers could see higher charges on bills sent December 31 under a proposal intended to improve the pipes and pumps that carry wastewater across the community.
The planned improvements include two upgraded lift stations, a new wastewater forcemain along 12th Street Northeast, and another along 13th Avenue East toward the wastewater treatment plant. The work is designed to relieve pressure on the collection system in central Sioux Center and provide capacity for continued development.
The Sioux Center City Council unanimously approved the first reading of the proposed rate ordinance Monday, September 14. The council expects two additional readings at its October 5 and October 26 meetings before final adoption.
The proposal would increase residential and commercial wastewater charges by approximately 9% on bills due beginning in January 2027. Those bills would cover approximately November 23 through December 23 usage. A second increase of approximately 8.3% would take effect on bills due beginning in January 2028.
City staff cited the planned collection system improvements and preparation for future wastewater permit requirements. The city’s last wastewater rate increase took effect in December 2023.
What Customers Would Pay
The monthly service charge for residential and commercial customers would increase from $23.33 to $25.42 on bills due beginning in January 2027, then to $27.55 on bills due beginning in January 2028.
The usage charge would rise from $5.72 per 1,000 gallons to $6.23 in 2027 and $6.75 in 2028.
For a customer billed for 3,000 gallons each month, the wastewater portion of the bill would increase from $40.49 currently to $44.11 in 2027 and $47.80 in 2028. That represents an additional $3.62 per month in 2027, followed by another $3.69 per month in 2028.
The ordinance also proposes increases in industrial wastewater charges.
Planning for Infrastructure Costs
Calvin Coles, a consultant with Waterworth, presented financial projections showing how operating expenses, construction costs, and debt payments could affect the utility over the next decade.
The East Interceptor project represents a major upcoming expense. Coles said the wastewater utility’s cash position would deteriorate as payments on the project’s debt begin without additional revenue.
“And then when the debt service associated with that starts to kick in, you’re running out of cash pretty quickly,” Coles said.
The financial model uses a reserve target equal to six months of operating expenses. It also accounts for anticipated customer growth.
“So there’s a one percent residential growth rate and a half a percent for the commercial and industrial customers,” Coles said.
Council members and staff also discussed whether favorable construction bids could reduce the project’s cost. Waterworth examined a scenario in which the East Interceptor project comes in $1.9 million below budget. That was a planning scenario, rather than confirmed savings.
Coles said lower construction costs could reduce the need for some later increases, while additional revenue would still be needed in the near term.
“After that, we can follow this on a year-by-year basis and see what the annual revenue increases are going to need to be,” Coles said.
Although the financial presentation explored possible increases beyond 2028, the ordinance under consideration establishes rates for 2027 and 2028.
Sioux Center Utilities Manager Murray Hulstein calls the increase an investment in the wastewater system’s long-term strength.
