Gypsum announces potential 40% rise in wastewater fees starting in 2023 |

Gypsum announces potential 40% rise in wastewater fees starting in 2023

Fees will help finance the cost of a new wastewater treatment plant

A small percentage of the wastewater fee increases for Gypsum residents will replenish the funds paid out to homeowners affected by the July 10 sewage spill.
Madison Rahhal/Vail Daily

The Gypsum Town Council announced in a Nov. 30 letter to customers that it is planning to raise wastewater fees in the town by 40% each year for the next three years and by 25% in the fourth year in order to fund the $65 million update and expansion of its sewage and wastewater treatment plant.

Construction of the plant is expected to begin in the spring of 2023 and be completed by 2025, with $17 million allocated for the capital improvement in Gypsum’s proposed budget for next year.

The rate increases are considerably more than the town had originally planned for the completion of the project. The original financial plan called for a 6% annual rate increase between 2020 and 2025 to generate the necessary funds for completion, but town engineer Jim Hancock said that the cost of the project has nearly doubled over the past three years, requiring the town to pursue a more aggressive income strategy.

​​”Since then, a combination of inflation — dramatically affecting materials, equipment and construction prices — in addition to tighter regulatory requirements have brought the total project estimate to $65 million, up from the $35 million estimated in 2018,” Hancock wrote in a Nov. 30 letter to wastewater customers. “As a result, the Sewer Enterprise Fund must generate enough income to create the cash flow necessary to be eligible for the borrowing that will be required to fund this project.”

Customers can expect rates to reach just over $40 next year, eventually growing to $107 in 2026, after which rates will flatten and be annually indexed at a rate of 1.5% over the Consumer Price Index for Denver-Aurora-Lakewood area.

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A 2018 study determined that the town would need to update its system within 10-15 years in order to accommodate changes in population growth and future regulatory requirements. The new plant will be able to meet projected user capacity for the next 20 years, accommodating population growth of up to 20,000 people.

Town council members approved the first reading of Ordinance 10 — which adopts the heightened fee increases — on Nov. 8. Council members expressed their chagrin at the much-increased price tag, but passed the first reading without hesitation.

“This isn’t really a choice that we have,” said council member Tom Edwards. “We have to do the sewer plant because we’re required to, and this happens to be the cost of the sewer plant, even though it’s staggering.”

In addition to helping finance the new wastewater plant, the rate increases will replenish the Sewage Enterprise Fund for expenses paid out to homeowners impacted by the July 10 sewage backup. The Town Council has approved $200,000 to cover the remediation costs of 12 homeowners, and has distributed $140,000 thus far. Hancock said that the total cost will likely go over this number, and around 5% of the increased wastewater fees will be used to make up the deficit.

The second reading and potential adoption of the ordinance will take place at the Gypsum Town Council meeting on Dec. 13, and the public is invited to participate with comments and questions.

“This is a substantial increase, no doubt, and yet our rates will remain competitive with rates statewide and significantly less than those of our neighboring communities,” Hancock said. “These investments are required to meet our community’s wastewater treatment needs.”

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