Presentation

Council Chambers
6:00 pm | October 19, 2023
Utility Rates
Public Hearing
Visit Chandleraz.gov/ProposedUtilityRates 
for more information

Agenda
Utilities Rate Change Outreach
Rate Analysis & Cost of Service Process
Utilities Revenue Requirements
Major Utility Rate Cost Drivers
Rate Change Overviews

Water

Wastewater

Reclaimed

Solid Waste
Utility Rate Comparisons
Proposed Ordinance and Resolution

Water, Wastewater, Reclaimed & Solid Waste
Rate Change Outreach
3
Public Outreach: Website
Public meeting schedule, Council action 
schedule, process timeline 
Rate changes in % and $ by classification, 
monthly bill calculator, FAQs 
History of rate changes and 5-year projected 
rate changes
Last Cost of Service (COS) study presentations, 
COS report
Public Outreach: Meetings
City Council Work Session, Public Hearing, 
Notice of Intent, and ongoing updates  
Residential and Non-Residential public 
meeting 9/13/23 in person and virtual
Chamber public policy meeting presentation 
on utility rate changes 9/8/23 
Met with individual stakeholders as needed
Information was also communicated in CityScope, Utility bill messaging, Social media posts, and 
media releases

Utility Rates Cost of Service (COS) Process
(2nd step of 3 towards COS realignment)
City’s Financial Plan Review 
(completed annually)
Cost of Service Analysis
•
More accurately reflects actual cost of 
providing service to each customer class
(completed every 5-7 years)
What is the funding requirement?
Is everyone paying their fair share?
4

Revenue Requirements
Revenue Increases - %
Water
Wastewater
Reclaimed 
Solid Waste
FY 2023-24
Jan. 2024 
7% (COS)
8.0% (COS)
7.0% (COS)
7.0% (COS)
FY 2024 - 25
0%
0%
0%
0%
FY 2025-26
Jan. 2026
7% (COS)
6.0% (COS)
7.0% (COS)
7.0% (COS)
FY 2026 - 27
0%
0%
0%
0%
FY 2027-28
Jan. 2028
7%
6.0%
7.0%
7.0%
Future year projections subject to change

Major Rate Cost Drivers – 
Aging Infrastructure
Wastewater
•
Total pipes & valves 947 miles
•
10-year CIP $131.8M
•
Reflects significant individual projects (e.g.66” Sewer Main)
•
Reactive replacements based on video/inspections
•
Increasing regulation for Water Effluent Quality
•
Inflation impact on capital and operations
Water
•
Total mains 1,238 miles
•
10-year CIP $81.6M
•
Reflects 1-2 miles of replacements per year
•
Proactive replacements based on risk 
(breaks interrupt plan)
•
Increasing regulation 
•
Inflation impact on capital and operations

Water Rates

Cost of Service Rates
Residential
Non-residential
Industrial
Revenue
Requirement
+7%
To ensure everyone is paying their fair share
Multifamily
Landscape
Shifting cost burden of revenue requirement to customer classifications differently allows for more accurate 
reflection of actual cost of providing service to each customer class

Volumetric Water Rate Changes
(2nd Step Towards 100% COS) 
Customer 
Class
Existing
FY
2023-24
(Jan. 2024)
Rate 
Change 
%
Single Family
Current FY
First 10 Kgal
$1.62
$1.66
2.47%
Next 10 Kgal
2.11
2.15
1.90%
Next 40 Kgal
2.65
2.73
3.02%
Over 60 Kgal
3.31
3.39
2.42%
Multi-Family
First 10 Kgal
$0.89
$0.91
2.25%
Next 10 Kgal
1.09
1.13
3.67%
Next 20 Kgal
1.49
1.55
4.03%
Over 40 Kgal
2.25
2.31
2.67%
Reflects total revenue recovery projected 
increase of 7.0% 
Existing 
Conser-
vation 
Tiers
Existing 
Conser-
vation 
Tiers
Customer 
Class
Existing
FY 
2023-24
(Jan. 2024)
Rate 
Change
 %
Per 1,000 Gallons
Current FY
Non-
Residential
$2.19
$2.37
8.22%
Landscape
2.70
3.08
14.07%
Industrial
2.17
2.37
9.22%

Water Average Bill Example

Water Conservation
• Tiered rates encourage conservation 
•low water users pay less per gallon for the water 
they use, high water users pay more
• Chandler offers free water-wise workshops, site 
visits, and retrofit kits (homes built prior to 1992)
• Current and new conservation rebate programs
•Residential and commercial grass removal 
•Non-functional turf removal
•Smart irrigation controller installation
•Council approved additional grant funding 
available this year to increase incentives

Wastewater Rates

Cost of Service Rates
Residential
Non-residential
Revenue
Requirement
+8%
To ensure everyone is paying their fair share
Multifamily
Shifting cost burden of revenue requirement to customer classifications differently allows for more accurate 
reflection of actual cost of providing service to each customer class

Wastewater Rate Changes
(2nd Step Towards 100% COS) 
Customer Class
Existing
FY 
2023-24 
(Jan. 2024)
Rate 
Change 
%
Current FY
Residential Base*
$27.65 
$27.65 
0.00%
Multifamily Base*
$10.57 
$12.92 
22.2%
Non-Residential
Volumetric**
$3.73 
$4.37 
17.15%
Customer Charge
$8.17 
$9.58 
17.25%
*   Monthly Charge per Dwelling Unit / Flat Rate
** Per 1,000 Gallons%
Reflects total 
revenue 
recovery 
projected 
increase of 
8.0%

Wastewater Average Bill Example

Reclaimed Water Rates

Reclaimed Water Volume Rate Change 
and Average Bill Example
All Reclaimed 
Customers
Existing
FY 
2023-24
(Jan. 2024)
$ per 1,000 gallons
$0.75
$0.80
Change - $
$0.05
Change - %
+7%

Solid Waste Rates

Solid Waste Rate Change and 
Average Bill Example 
FY 2023-24
Proposed for 
Jan. 2024
All Covered 
Residences
+7%
Major rate driver is collection contract increases

January 2024 Free RSWCC Visits and Bulk 
Pick-Up Policy Changes 
• A total of 4 no charge RSWCC visits or bulk 
pickups per calendar year in any combination
•
Currently 2 free RSWCC visits and 2 free bulk pickups, 
but customer feedback wanted change
• After 4 no charge, RSWCC is $10 for up to 400 lbs. 
and bulk pickups are currently $30 proposed to 
change to $35
Solid Waste Policy Changes

Solid Waste Fee Updates
• Additional/Replacement container charge from 
$60 to $75
• Additional/Replacement Containers for Large Alley 
size change from $235 to $430
• Additional container collection fee $7.50 to $15
• Special collection fee non-alley $17.50 to $18.50 
and Alley $25 to $35
• Additional Bulk collections above free allocation 
from $30 to $35
*All of these are to adjust costs to the current City cost for full 
cost recovery

Combined Average Customer Bill Example

Average Residential Cost Comparison 
for Water, Wastewater and Solid Waste
Estimated based on Tempe Cost of Service July 2023 results at 10,000 gallons single family residential rates for FY 2022-23 
plus Chandler’s planned rate increases and any recently passed rate increases for other municipalities

Average Multi-Family Cost Comparison 
for Water, Wastewater
Estimated based on current adopted rates by city (some cities may be increasing rates which are not included). Includes 
500Kgal of monthly usage, a 6” meter, and 150 units.

Average Non-Residential Cost Comparison 
for Water, Wastewater
Estimated based on current adopted rates by city (some cities may be increasing rates which are not included). Includes 
200Kgal of monthly usage, and a 2” meter.

• Ordinance #5065 allows for changes to 
City code chapters 44 (Solid Waste) and 
50 (Utilities) to make the needed rate 
and fee policy adjustments
• Resolution #5751 allows for changes to 
the fee schedule which is where solid 
waste fees are presented
For changes to be effective an 
Ordinance and Resolution are both 
needed

Task or Event
Date
Notice of Intent Adopted (60 days prior to Public Hearing)
Completed
 August 17, 2023
Public Outreach
Completed 
Aug-Oct 2023
Notice of Intent Published in Newspaper (20 days prior to Public Hearing)
Completed 
September 27, 2023
Feedback to Council on Public Outreach
Completed
October 16, 2023
Public Hearing / Ordinance First Read / Resolution to Update Citywide 
Fee Schedule
October 19, 2023
Ordinance Final Adoption (Can go into effect 30 days after adoption)
November 9, 2023
Rates Effective for January Billing Cycle
January 1, 2024
Rate Adjustment Timeline

Questions?