Queen Creek council holding first public hearing on proposed water rate increase

The first of two public hearings on a proposed 15% water rate hike is set for Wednesday at the Queen Creek Town Council meeting.

The meeting starts at 6:30 p.m. at Community Chambers, 20727 E. Civic Parkway.

An administrative oversight is giving Queen Creek residents a second opportunity to have their voices heard regarding the proposed increase.

Originally, the Queen Creek Town Council was going to be holding a public hearing and a vote on the proposed hike on May 7. Now, the public hearing will occur as scheduled, but the council vote is being pushed back.

Under state statute, a municipality looking to increase water or wastewater fees must adopt a notice of intent that sets a public hearing on the matter at least 60 days later.

On March 5, the council adopted the notice of intent and set the public hearing for May 7.

While the notice of the hearing was posted on the town’s website and included in water bills, the town failed to publish it one time “in a newspaper of general circulation within the boundaries of the municipality not less than (20) days before the public hearing date,” according to the statute.

As a result, staff is recommending that the council adopt “a further public hearing and possible action to adopt the rate increase” on Wednesday, July 16 to allow for the notice to be published in a newspaper, according to a council staff report.

Because the public hearing notice was posted onto the town’s website and included in water bills, “the public hearing on May 7, 2025, should occur to allow for any members of the public attending the meeting to speak on the proposed utility rates,” the report continued.

Queen Creek is proposing the 15% increase to offset the costs of providing water to the rapidly growing city.

Queen Creek has not instituted a water rate hike since 2010.

In June 2023, the town’s water utility was operating at an $11.4 million deficit. The deficit grew to $16.7 million as of June 2024, according to staff documents.

The rate hike is forecast to raise revenue by $4.3 million in the next fiscal year. The 40,000 residential accounts will account for 67%, or $3 million, of the increased revenue.

More than half the residential accounts, 25,000, will see an increase of between $3 and $6 a month.

If approved on July 16, the new rates will be effective on Aug. 15 and will be reflected in residents’ water bills beginning with the Oct. 7 billing cycle. Sewer rates would not be affected by the increase.

The proposed rate hike was introduced to the town council at its Feb. 19 meeting.

During the past 10 years, the town’s water utility has grown to a service area of about 70 square miles — larger than the town’s boundary.

The tremendous growth in the town’s population during the past decade has resulted in the town acquiring other water companies. At the same time, the cost of constructing infrastructure, as well as the purchase of water and groundwater extinguishment credits, has risen, causing the gap between revenue and capital expenses to widen.

The six council members who attended the Feb. 19 meeting said the increase, although not desirable, was needed. Council Member Travis Padilla was absent from the meeting.

“We always talk about being fair, and gosh, we would love to be able to put prices down rather than up,” Council Member Robin Benning said. “But the reality is for our residents there’s a structural deficit and we need to figure out ways to reduce that deficit to the greatest extent possible, and unfortunately, if that means raising rates — there’s no magic pill, we have to do that.”

The increase would be an interim step until more comprehensive rate and capacity fee studies can be put in place. Capacity fees are the one-time fees paid by new development to recover growth infrastructure.

“There’s a lot involved from the acquisition of water to replenishment to all of the infrastructure we build,” Mayor Julia Wheatley said. “I know this council and the previous councils have prided ourselves on the fact that we are fiscally responsible.”

The town is also weighing future water policy changes, including becoming a designated water provider and possibly charging water-only customers living outside of the town higher monthly rates than combined water and wastewater customers within the town.

Even with the increase, most Queen Creek residential customers will be paying less than residents in neighboring cities.

For example, based on a staff report, an average monthly water bill for Queen Creek customers will rise from $34.26 to $39.40. That’s still lower than Tempe at $45.42, Gilbert at $52.78 and Mesa at $62.66.

Over the past year, Gilbert and Tempe have raised their customers’ water and wastewater rates.

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