Asheville considers water rate changes for its users. Who will see increases?

• Asheville City Council will consider proposed water fee increases April 8, the second year of planned rate adjustments.
• The city said increases are needed to fund a multimillion dollar capital program, as well as correct inequities within the existing payment structure.

ASHEVILLE — City Council will consider water fee increases in April, the second year of planned rate adjustments intended to fund a multimillion-dollar capital program and correct inequities within the payment structure.

For years, the city’s residential water customers have subsidized its commercial and industrial users, with residential users shouldering more than their fair share for the city’s water supply, according to a 2023 water rate model study from Raftelis, a Charlotte consulting firm.

This is the midway point for a three-year, phase-in approach of proposed rate adjustments. In a March 11 presentation to Asheville City Council, staff said other major fees — such as stormwater, solid waste and parking — are not recommended to increase.

In the wake of Tropical Storm Helene, the city is facing an especially difficult budget season. Staff noted a “great deal of uncertainty” regarding revenue estimates, with early numbers indicating a dip in fiscal year 2026. While attempting to keep department operating budgets flat, unavoidable cost increases, like employee health care and state-mandated retirement, exacerbate challenges.

Finance Director Tony McDowell said estimates project general fund revenues will be down $1 million to $4 million, with the biggest hits likely to be taken by sales and property taxes, the city’s largest revenue sources. Expenses are projected to increase by another about $4.1 million.

Staff developed an initial list of cost saving strategies, which would create about $4.5 million in savings, focusing on items where other funding sources are available, like the recently approved $80 million in general obligation bonds, federal disaster recovery dollars and FEMA reimbursement.

How much are water rates proposed to increase?

Rate adjustments are needed to fund a five-year capital program, estimated at $239 million even before Helene, according to the staff presentation. This includes the city’s ongoing meter replacement project, water treatment plant rehabilitation and other enhancements.

It adopted Year 1 of the adjustments on March 26, 2024. The changes took effect July 1.

Asheville water has been top of mind for many after the storm wreaked havoc on the city’s water system. Customers went without potable water for seven weeks. Helene churned up the once-pristine Burnett Reservoir, washed out major lines and put even greater attention on needed redundancy and resiliency.

In an attempt to correct the rate imbalance for residential versus others users, proposed Year 2 rate changes recommend steeper increases for wholesale and manufacturing customers.

A 7.5% increase is proposed for residential and commercial customers, 14.1% for the first class of manufacturing users, and 19.9% for the second. Wholesale — of which there are only a handful of accounts, including Woodfin Water & Sewerage, the town of Black Mountain and the town of Biltmore Forest, the Citizen Times reported previously — would see the highest increase, of 32.2%.

Asheville City Council will vote on the changes April 8.

More: Asheville residents have been paying too much for water, city says; Other users face hikes

More: With estimated $17.6M in revenue loss post-Helene, Asheville faces ‘uncertain’ budget season

More: UNC Asheville chancellor says campus properties, including urban forest, will be developed

Sarah Honosky is the city government reporter for the Asheville Citizen Times, part of the USA TODAY Network. News Tips? Email shonosky@citizentimes.com or message on Twitter at @slhonosky.