City Council Meeting Date: September 23, 2025
To: Mayor and City Council
City Administrator
From: Brenda Angelstad, Finance Director
Justin Wagner, Utilities Manager
David Bennett, Public Works Director and City Engineer
Title
Consider Adoption of Utility Rates (except water) for 2026.
Body
Action Requested:
The Northfield City Council approves the attached Resolution Adopting the Utility Fee Schedule (except water) for 2026.
Summary Report:
Attached is a resolution for proposed utility rates for 2026. In 2025, the City conducted a Utility Rate Study with Baker Tilly, Inc., a public sector financial advisor. The study included updated assumptions regarding budget revenue and expense projections and 10-year Capital Equipment and Capital Improvement Plans.
The report was presented by Baker Tilly at the September 16, 2025, City Council Work Session. The proposed rate adjustments are following the report recommendations and the adjustments for the 2026 Utility Rates:
Wastewater (Sewer)
A 3% increase recommended for 2026. The increase is needed to maintain positive operating income as well as to pay for anticipated operating expenses, capital outlay and debt service.
Below is a graph of comparable cities stormwater rates.
Storm Water
A 5% increase recommended for 2026. The increase is needed to pay for anticipated operating expenses, debt service and capital outlay including the targeted amount to maintain adequate cash reserves.
Below is a graph of comparable cities stormwater rates.
Garbage Rates
A 6.5% increase recommended for 2026. The increase is needed to pay for anticipated operating expenses, debt service and capital outlay including the targeted amount to maintain adequate cash reserves.
Alternative Options:
Not recommended.
Financial Impacts:
The proposed rate increases allow us to maintain our facilities. An average residential customer who uses 589 cubic feet of wastewater monthly would see their wastewater rates grow from $41.74 to $42.99 in 2026. An average residential customer that owns 0.33 acres of land would see an increase in stormwater rates from $11.41 to $11.98 in 2026. An average resident that uses a 35 gallon garbage can would see an increase from $12.55 to $13.30 in 2026.
The average monthly residential total wastewater, stormwater and garbage rates would go from $65.70 to $68.28 or an increase of $2.58 per month. Water rates will be determined at a future date.
Tentative Timelines:
New rates would take effect January 1, 2026.