What’s in a Rate? How the District Determines Monthly Rates - Fort Collins - Loveland Water District
As of January 1, 2025, water tap fees and monthly rates will be increasing. For more details, click here.

For over 60 years, Fort Collins – Loveland Water District (FCLWD) has been committed to providing clean, safe, and affordable water to our Northern Colorado community—and that’s how it’s going to remain. With changing times comes changing prices, however, including prices for the acquisition, treatment and distribution of impeccable water, as well as the equipment and labor that allows for these processes.

We don’t take raising rates lightly, but it’s necessary for continued, ongoing access to potable water. And, since our board has agreed to a price increase, we want to be as transparent as possible about the reasoning and process behind the change.

As of January 2024, FCLWD will be raising rates by 5% for residential, commercial, and irrigation customers—though this will likely only mean an extra $2.20 per month for the average single-family home customer. Additionally, we’ll be increasing the plant investment fee for developers to a flat rate of $17,000.

How Was the Latest Rate Determined?

The FCLWD board of directors didn’t come to this decision alone. We only made the tough call to raise rates following a careful, independent review by local government and utility consultant Raftelis.

Because we wanted to give our customers sufficient time to learn about and adjust to any price increases, we reached out to Raftelis in early 2023 to begin a comprehensive rate study. By the end of the summer, they came back to us with a rate proposal informed by:

  • The American Water Works Association’s guide on rate studies—the national industry standard for technical approaches to setting utility prices.
  • The previous 2018 rate study and its recommendations.
  • Average water usage for the region.
  • Economic data for the region (e.g. median household income).
  • The Cost Performance Index (CPI), a metric that evaluates the effectiveness of a project against its budget.
  • How other districts and municipalities with similar populations are currently handling rate increases.

Based on this data, Raftelis proposed a rate hike of 50% for residential, commercial, and irrigation uses. FCLWD’s board, however, didn’t support the idea of such an abrupt and drastic increase, opting instead to raise rates by only 5%.

Rather than increasing customer costs by a significant amount, we’re reducing funding to our Capital Projects Program and leveraging savings from our last 15 years of investments to keep rates as low as possible.

Despite challenging economic circumstances, we hope to use this strategy to keep rates low while we continue to fulfill our mission.

What Do Increased Rates Pay For?

Our board has a rule when it comes to raising prices: Rate increases solely fund the equipment, maintenance, and treatment necessary to keep pure, high-quality water flowing from customers’ taps. While we’re more than proud of our support for local projects, development will never take priority over providing residents of the District with affordable water.

Thus, only plant investment fees will go to funding Capital Projects in 2024 that support future growth, while the 5% rate increase will be used to:

  • Replace and upgrade aging infrastructure – The District’s equipment has seen a solid six decades of continuous operation, and it’s beginning to show its age. From increasing hydraulic capacity and improving overall system performance and reliability through the Zone 5 project to installing a new larger water line through the Western Backbone project, expanding and upgrading infrastructure now will guarantee fresh water for generations to come.
  • Defray rising labor, equipment and distribution costs – Global inflation of 6.6% in 2023 has affected pricing in the water treatment and distribution industry, raising the costs of equipment, materials, and more.[1] Likewise, Colorado increased wages at the beginning of 2023 and plans to do so again on January 1st, 2024.[2] Put simply, prices are rising across the board, forcing us to follow suit to maintain quality and reliability.

To continue delivering our customers the same fresh, clean supply of water they’re used to, we’re adjusting rates to both keep up with the times and prepare for the future.

How Much Will My Bill Increase in 2024?

Your expected bill increase in 2024 will depend on how much water you use. Nevertheless, we’ve projected some potential averages pursuant to different types of customer accounts:

  • The average single-family household will pay approximately 2.20 more per month.
  • Multi-family units will see their structure change to a decreased per unit monthly cost (from $17.01 to $7.89 per unit) and a flat amount charged per 1,000 gallons (versus using a three-tier structure).

We understand that rate increases—of any amount—can affect individual and household budgeting. If you’re concerned about future bills, consider some of our water conservation tips to reduce your overall usage in 2024 or reach out to us to discuss available budget billing options.

What Does The Future Hold for FCLWD’s Rates?

Price increases are inevitable across nearly every facet of life. Water, however, is essential to our very existence. It should be accessible and affordable for residents of the FCLWD and beyond. That’s why we want to make it easier to budget for water bills and predict future rates.

In mid-2024, we’ll reevaluate our rates and budgets for the remainder of 2024 and into 2025. Despite the 50% increase recommended to us this year and similar economic forecasts for 2024, we’re planning to only charge 5% more. Through thoughtful financial planning, we hope to maintain this low, and predictable rate increase annually.

Learn More About Water Rates and Contact Us with Any Questions

Raftelis’ full report is available on our website if you’d like a more in-depth breakdown of the factors contributing to increased rates. And, if you want to know more about 2024’s prices or the FCLWD as a whole, don’t hesitate to get in contact with us. One of our skilled staff members can field your questions or pass them on to Raftelis if you have specific queries about the report.

Finally, to all the customers of the District: Thank you for your understanding and support as we strive for excellence in water distribution. We hope to continue working together in the name of conservation and fresh, accessible water for everyone.

Sources:

[1] International Monetary Fund. World Economic Outlook. https://www.imf.org/en/Publications/WEO

[2] Bloomberg Tax. Colorado Minimum Wage Expected to Rise to $14.42 in 2024. https://news.bloombergtax.com/payroll/colorado-minimum-wage-expected-to-rise-to-14-42-in-2024

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