Islamorada residents can expect their wastewater bills to increase in the coming years amid rising operational costs and future expensive upgrades to the collection system.
At a recent village council meeting, the firm in charge of providing the wastewater rate study, Raftelis, recommended annual increases of 6% from 2027 to 2031. Operating costs for fiscal year 2026 are expected to reach $7.2 million, but revenue from ratepayers is projected at $6.9 million.
Raftelis’ Trevor McCarthy said costs to operate and maintain the village’s wastewater system are expected to rise annually by 3%. He said the village should also have adequate cash reserves, a minimum of 120 days of operating and maintenance costs plus 2% of gross depreciable assets.
For the typical household, the increase would equate to $55.32 per year. Following the presentation, the village council recommended proceeding with a rate increase to help fund a shortfall in wastewater operating expenses. The village council is expected to consider approval of a resolution for the rate increase at a September meeting.
McCarthy told council members the last rate increase was implemented in 2021. He said a rate study was done in 2022, which at the time recommended a 1% increase per year to account for rising costs and system upgrades. No changes to rates were enacted by the village. Since that time, McCarthy said, utilities have experienced rising costs to operate wastewater systems and capital projects to keep systems efficiently running.
“This is something we’re seeing all across the state,” he said. “This is driven by inflation that persisted for a longer period of time than anyone would have thought back in 2022.”
Neighboring communities have also seen their rates increase. The city of Marathon will see a 7% increase in the city sewer’s base facility, customer and flow charges. The increase was approved by resolution, which allowed for a 7% increase in fiscal years 2025-27 and a 1% increase in fiscal year 2028.
In addition to operation and maintenance, the village will need to come up with millions of dollars to fund future upgrades to the wastewater system, which sends effluent from homes in Islamorada to the Key Largo Wastewater Treatment Plant. Village staff have come up with $38.4 million in future upgrades; half of the total amount is funded through grants. McCarthy said the village could take out a loan or line of credit to come up with the other half. In either case, ratepayer revenue would be used to pay back the debt for capital improvements.
