Proposed Rate Increase for Phoenix Water Services and Stormwater Excise Tax

The Phoenix Water Services Dept. is proposing a rate increase to address rising costs for water and wastewater services. While the increase is necessary to meet inflationary pressures affecting utilities across the nation, Phoenix will still have some of the most affordable water services compared to other large cities, and customers who conserve water will be able to lessen the impact of the higher rates. There is also a request to increase the Stormwater Excise Tax to fund the City’s compliance with new requirements for preventing pollution from entering waterways.

Water and Wastewater Rates

Preliminary estimates show the average residential customer will see an increase for water service (Water Usage Fee) of approximately 6.5% or $2 in October 2023, with additional increases in March 2024 (6.5%) and March 2025 (13%).

For wastewater service, the average residential customer will see an increase of approximately 6.5% or $1.60 in October 2023 with additional increases in March 2024 (6.5%) and March 2025 (7%).

Changes to the water and wastewater rates impact everyone differently, and there are many factors that determine how much each customer pays.

Water Allowance and Conservation

The proposal also includes changing the water allowance structure to encourage water conservation, which could result in some customers paying an additional amount of approximately $4 more beginning in October 2023. The Phoenix Water Services Dept. has a seasonal structure for rates where charges are higher in the hotter seasons and lower in the cooler seasons. It is designed to encourage water conservation and discourage excessive water use in the summer when outdoor water use increases. The City of Phoenix declared a Stage 1 Water Alert on June 1, 2022,​ and that alert is still in place. With conditions on the Colorado River expected to worsen, Phoenix Water customers must prioritize conservation.

Stormwater Excise Tax

The Stormwater Excise Tax funds the City’s compliance with a required Clean Water Act Municipal Separate Storm Sewer System (MS4) permit from the Arizona Department of Environmental Quality for operation of the storm drain system. This permit is required to prevent pollution from entering our washes and rivers and requires actions by the City, such as infrastructure maintenance, water quality monitoring, and inspections. As of 2021, the City is operating under a new permit with new and expanded requirements. An increase of $0.25 per month for single family residences (5/8 or 3/4 size water meters) is being proposed to fund the City’s compliance with these legal requirements. This increase equates to an additional $3.00/year for these accounts. The proposed increase for larger meter sizes is scaled at a graduated rate using the equivalent dwelling unit methodology.

Public Outreach

City of Phoenix Water Services staff will attend public meetings to gather comments and provide information on the proposed increases. For the meeting schedule and more information about the proposed rate increase, please visit phoenix.gov/proposedrates.