Chandler staff finally have some direction for its proposed next utility rate pricing strategy.
An Aug. 4 Chandler City Council work session produced a consensus on what proposed rate increase plan council will send out for a public input cycle, with the hopes of making final decisions in advance of a March 2, 2026 effective date for new utility rates.
Council member O.D. Harris was out of town and wasn’t at a July 14 work session that addressed many of the same elements of utility rates covered Aug. 4. On July 14, in the informal poll Mayor Kevin Hartke takes at the end of a work session, council members deadlocked, 3-3, on which of two strategies to choose.
At the end of the Aug. 4 work session, Hartke told the council he’s directing staff to take an “across-the-board” 15% rate increase plan to the public for input in the months ahead, with no objections.
Three types of “blended” COS/across-the-board increase models were also proposed. Blended plans would continue to use fiscal 2020 data to align cost-of-service rate increases for anticipated increase needed based on the prior projection, and implement an additional increase needed in fiscal 2026, applied evenly across the board to all classifications.
That proposal, among the four presented Aug. 4 by the city’s finance directors, would create a sort of medium amount of increase for multi-family housing customers in Chandler, but it offers the least impact on the city’s heavy-use industrial customers, such as Intel.
The July 14 work session included longer discussions about Intel specifically. Hartke seemed concerned that Intel, which Utilities Director John Knudson said has built up a hybrid, multi-technique water treatment and reclamation process, will ramp that process up more quickly to save money, paying the city less and less to treat wastewater.
City Budget Director Matt Dunbar pointed out other industrial customers in Chandler besides Intel include Applied Materials Inc., NXP, Ferguson Builders Arizona, D.R. Horton, the Rogers Corp. and several airport or aerospace companies.
The 15% increase would still be a hit for the industrial users, who are looking at a monthly city water-wastewater bill increase of more than $300,000. The “both-blended cost-of-service” option would raise the monthly bill for Intel and other Chandler industrial customers by almost $500,000, with two other plans that are across-the-board/blended cost-of-service combinations landing in between those two totals.
The 15% across-the-board proposal would raise the average multi-family housing complex (150 units or more) bill by about $470. That increase would be $666 per month under one of the blended plans, but only $387 under another.
Knudson said not only has inflation driven up the cost of everything from contract labor to water treatment chemicals, it’s also driven up the cost of major needed projects. Utility revenue is one of the ways Chandler funds replacement and maintenance of its aging infrastructure.
“I’d like to be able to do more,” Knudson said. “It’s like knowing if your home has termites. We can see what’s happening with pavement, but there’s a lot of infrastructure we can’t see until we invest the resources to inspect it. And we know a lot of it is at or near end-of-life.”
Harris didn’t speak much in the 1-hour Aug. 11 session, though he did ask a few questions related to keeping cost increases low, or at least predictable, for individual residents.
Residential customers would pay an average of $9 per month more for city water and wastewater service in the 15% across-the-board proposal, compared with a $5 increase in the both-blended plan.
Jason W. Brooks News Editor | Chandler Independent
Jason W. Brooks joined Independent Newsmedia, Inc., USA, in July 2021 as an associate editor. After a year covering Buckeye, he has covered Chandler since the fall of 2022, in addition to assisting the Daily Independent throughout his time at INI.
Education: University of New Mexico, bachelor of arts in journalism and mass communication, print emphasis, English minor.
Random Fact: He and his siblings witnessed a Space Shuttle launch and landing in the same year in person, on opposite coasts.
Hobbies: Karaoke, bicycling and American Sign Language.
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