Public Works ands Utilities Committee Mon, Dec 1, 2025 · Public Works and Utilities Committee https://santafeminutes.space/meeting/309 == Executive Summary == The Public Works and Utilities Committee met on December 1st and focused primarily on the city's water system finances and infrastructure needs. The central issue is that water rates have not changed since 2013, despite 41% inflation over that period, while the city faces roughly $30 million per year in capital project needs — up from the current $9 million annual spending. Major upcoming projects include rehabilitation of McClure Dam, upgrades to the Canyon Road Water Treatment Plant, and the San Juan return flow project, following the recently completed Nichols Dam outlet works rehabilitation ($20 million, on time and on budget). To address the funding gap, the committee approved a multi-part strategy: pursuing $77 million in external loans and grants, raising developer fees in lieu of water rights from $16,600 to $36,000, and phasing in water rate increases over five years. The rate structure will also change from a seasonal two-tier system to a year-round three-tier system designed to reward low water users and discourage heavy outdoor summer use. For a typical user, bills are projected to rise modestly from $44/month now to approximately $49/month by the end of the five-year period. Low and average users will see little immediate impact or even slight decreases, while high summer users will see more significant increases. The meeting also included recognition of departing Councilor Romero Worth for her eight years of service, particularly her contributions to water conservation planning, and Taylor Jurgens was named November Employee of the Month for her leadership on the Nichols Dam project. A brief discussion touched on the need for better youth-focused programming and resources, though no formal decisions were made on that topic. == Key Decisions == - Agenda amended to move Item 10 before presentations — approved unanimously - Consent agenda approved unanimously, including the water rate increase ordinance - Developer fee in lieu of water rights increased from $16,600 to $36,000 - New three-tier, year-round water rate structure approved for implementation in January 2027 - Water rate increase approved for implementation in February 2026 (approximately $1-2/month for typical users initially) - Decisions on separating multifamily rates and redesigning commercial rates deferred to a future meeting == Motions & Votes == - Motion to amend agenda by moving Item 10 before presentations — Passed unanimously - Consent agenda (including water rate increase ordinance) — Passed unanimously via roll call - Resolution to increase developer fee in lieu of water rights from $16,600 to $36,000 — Passed - Approval of new three-tier year-round rate structure (effective January 2027) — Passed - Approval of water rate increase (effective February 2026) — Passed == Public Comment == There was no public comment from the chamber during the meeting. Council discussion touched on support for residents affected by the rate increase — Councilor Castro asked about conservation programs, and staff confirmed the availability of the ION water app for real-time usage monitoring, rebate programs for water-efficient toilets, washers, and dishwashers, and incentives for rain barrels and outdoor irrigation equipment. Councilor Garcia expressed appreciation for efforts to develop programming for teens and young adults and acknowledged the difficulty in sourcing age-appropriate resources for that demographic. == Topics == - Water Rate Increase - Water Rate Structure Change - Councilor Romero Worth Farewell - Employee of the Month Recognition - Nichols Dam Rehabilitation Project - Asset Management Software Upgrade - Water Conservation Programs - Capital Projects Funding - Developer Fee In Lieu Increase - Meeting Procedural Items - Community Holiday Events == Full Transcript == We are live. Thank you so much. I call to order the Public Works and Utilities Committee meeting. It is December 1st and it is 5:03. Can I have a roll call, please? Yes, Madam Chair. Councilor Castro. Councilor Lee Garcia. Here. Councilor Michael Garcia. Excused. Councilor Romero Worth. I'm here. Councilor Chavez. Here. Thanks. We have a quorum. Next is approval of agenda. Are there any changes from staff? Staff would like to change the agenda and move item 10 up before presentations. Move to approve as amended. Second. I have a motion and I have a second. All those in favor signify by saying aye. Aye. Any opposed? Seeing none. Motion passes. Next is approval of the consent agenda. Are there any items pulled? Last I saw there were no items pulled. Correct. Move to approve. Second. A motion. Can I have a second? Could I get a roll call, please? Councilor Castro. Aye. Councilor Lee Garcia. Yes. Councilor Romero Worth. Yes. And Councilor Chavez. Yes. Motion passes. Next is public comment. Is there anyone from the public that would like to come speak to us this evening? All right, I see no one in chamber. So next we will be moving to item 10, matters from staff. Madam Chair, members of the committee, we at Public Utilities Department and specifically the Water Division wanted to take a moment to thank Councilor Romero Worth for her eight years of service not just to the city but also to the utilities department and specifically to the water division. It has been an honor and a privilege to work with her and she has been a champion for us and someone who we could turn to for advice, for help and for support when we had something to move through committee and through the governing body. So thank you so much, Councilor. I'm going to allow some other people to say a few words and we have a little token of our appreciation of everything you've done for us. Hello. I want to echo what Jesse had to say, but I also had the extreme privilege of working very closely with Councilor Romero Worth. She was the chair of the Water Conservation Committee for eight years and she really shaped the work in our section, elevated our conversations, always kept water conservation in the forefront of all of our discussions and I just feel it was a complete privilege to work so closely with her. I just want to thank you for everything and I just think that your legacy will live on for many years. So just thank you so much. And we have something special for you. I'll let Jesse give it to you. [laughter] This is from Bill and Christine and a little something for when you're skiing. Can we get a picture with you? That would be great. I just want to say thank you if that's okay, Madam Chair. I really appreciate. I have to say Jesse, it seems like just yesterday when you stood at that podium for I don't know 45 minutes and answered questions about the resolution that created the 40 and 80 year water planning and I still think that is such a significant achievement for us and for the city and all the work that's going on to develop those plans and do them in a way that will serve the community for a long time. So it's gone by in a blink and I just have to say it's been my privilege to learn about the work you do, to support the work you do, and just to be a part of it all. So thank you. You guys are amazing. And just keep on trucking. Thank you, Madam Chair. I'm going to break rules because you have to leave in 11 minutes. So I want to open it up to committee to see if they'd like to say anything for Councilor Romero Worth's last Public Works and Utilities meeting. Councilor Lee Garcia. Thank you, Madam Chair. Again, kudos to you, Councilor Romero Worth. Your expertise and what you bring to the table really adds value to so much because the conversations, whether we agree or disagree, it's there and your presence sure has been welcome. So kudos and congratulations. Thank you, Councilor. Councilor Castro first. Thank you so much. As the person who has probably worked with you the least on this day, I am very sad to see you go. But it has been an honor and the leadership, especially as our parliamentarian, dealing with some of the strong personalities on this day as you've done it with grace. So thank you so very much. I remember Councilor Romero Worth invited me to my first water meeting and I almost went cross-eyed. [laughter] The science behind it is beautiful and her passion behind it and your passion behind everything. I was writing you a note and the word that just kept coming to me is brilliance. I think you are brilliant in so many ways and you're kind with it. And I think as a new councilor, you are always that one that kind of swoops us up and tries to give us the knowledge and the guidance to be successful. And it's nice having a colleague that cares about your success. So I hope you give yourself a lot of credit for navigating this world for others the way you do. And I appreciate you very much. Thank you. Thank you, Madam Chair. It's been an honor to serve on this committee. I really appreciate all your work, too. Thank you. Appreciate you. Thank you all. Thank you, Jesse, and your team. That was a great way to start a meeting. And I'm always emotional. But we will go back to our agenda, new business. And I think that brings us to presentations. So, Public Utilities Department Employee of the Month. Good news. More good news. I like that. For November, Taylor Jurgens, Water Division. And Jonathan Montoya, Interim Water Division Director. Good evening. Good evening. So John Delmare is Taylor's manager and he nominated him for the Employee of the Month. And so every month we go around and we kind of huddle up and we try to see who's the outstanding, the bright shining outperformer of the team. And of course we have an awesome team, but Taylor, you rose to the top. And John wanted to—he couldn't be here but he prepared a little brief paragraph here that I'd like to read. Please. Taylor Jurgens started as an engineer with the City of Santa Fe Water Division in the fall of 2022. Taylor quickly learned the complexities of the city's water system, our land use process, and city government processes, which can be confusing sometimes. The city was very fortunate to have Taylor join our team and immediately contribute to a wide range of water engineering projects. In November, two large projects under Taylor's leadership reached major milestones. These projects are the Nichols Dam outlet works rehabilitation project and the Public Utilities asset management software upgrades. On November 6th, the Nichols Dam rehabilitation project celebrated substantial completion. This is a $20 million construction project that reached substantial completion on schedule and within budget. This project completed general safety and operational upgrades on the Nichols Dam and Reservoir in the Santa Fe watershed. The asset management software upgrades have been in the works for close to five years and under Taylor's leadership, the new software was rolled out to the Public Utilities Department in November. This software will be critical in managing thousands of assets in the water and wastewater division and is a joint effort with the city Public Works Department. Taylor has played a pivotal role in managing both of these projects while maintaining numerous other duties in our division. He is an outstanding employee and is very deserving of this recognition and I agree with him as well. So I just wanted to say thank you. John says thank you as well. But you know it takes a lot of dedication to not only work with Mike and the wastewater team but have to deal with all the folks in all the water division sections to manage the asset management software. You've really done well in getting us all to contribute and be a part of that process and I see that as being such an important thing going forward for the utility as a whole. So I want to say thank you for that. Great job, Taylor. Want to come up? Can we shake your hand? So I typically invite you to say anything but you don't have to but we would be honored to shake your hand and thanks for your work if you want to come up and talk first. Either one. Yeah. I don't have too much else to add. I'll just point out that it really is a great team that I work with every day. All across the water division, even within my section, they just make it really easy and make it a joy to come to work every day. So the work we're doing day in and day out is interesting and fun. So it's been a pleasure for these first few years I've been with the city. Well, thank you, Taylor. If you want to come up so we could thank you. Madam Chair, if I might. Yes, please. I just would like to echo the sentiments of his colleagues. I have always been impressed with your poise and knowledge at the podium and just the thoroughness with which you can answer our questions and help us understand what you're doing. So I could tell from the beginning you were going to be a star in this work. So I just think this recognition is well deserved. Thank you. We agree. Are there any other comments from committee? All right. Great job, Taylor. Thank you for being here. Thank you for all you do. Right. Next presentation, we're turning to Director Jesse Roach. Water rate increase and rate structure change. You need any IT support, Director? Oh, it looks good. No, look how smooth that was. Wow. And I'll just mention as I start that Taylor will get eight hours of administrative leave to use in recognition of his Employee of the Month status. All right, thank you all for the time. I just wanted to go through a little bit of background and actually Mike, if there's someone in the waiting room, if Melanie Hobart's in the waiting room at the end of this will you let her in or Colton? Thank you. One of the items on consent tonight was an ordinance to increase water rates over the next five years and also change the water rate structure. And because this has been a busy last couple months of the year, this is the opportunity we have to sort of present some of the nuts and bolts of that to you all. So that's the purpose of this. The first slide is something you've seen before and this is just a quick overview of the reasons that we need to do this. We haven't raised water rates since 2013 and in that period of time inflation went up by 41%. And we have several large capital projects that we need to complete to continue to provide the reliable service that we do. So we're proposing a fairly modest increase that would see the average user's bill rise by about $5 per month at the end of a five-year period, phased in over five years. This slide shows the history of the total city utility rates since 2013. And so the bottom is water. And you can see that in 2013, this is the average monthly bill for a typical user who would use 4,200 gallons of water and 2,800 gallons of water in the winter. So that's the wastewater piece. So they would pay $44 a month. Actually, so in 2013, this typical user was paying $44 and they were still paying $44 currently. Wastewater and environmental services did go up during that time. The other piece of this is historically, prior to this fiscal year, we spent about $9 million on average on capital improvements, which honestly probably was not enough. This is something that we were going to need to increase anyways just to make sure that we were maintaining our system. But these four large projects that I mentioned—the Nicholls Dam project we heard about, a similar project at McClure, the Canyon Road Water Treatment Plant effort that's getting underway now, and the San Juan return flow project—the four of those will combine to bring that spend up to closer to $30 million a year over the next five years, including this current fiscal year. Water needs more revenues, and there are three other pieces to that increased revenues. One of them is that we actively look for external resources and we're seeking $77 million in loans and grants. We did pass a resolution to increase what we call our fee in lieu, which is essentially what we charge developers for water rights. That'll go up from $16,600, where it was since 2010, to a more market-based $36,000. With the San Juan return flow project, we also anticipate being able to offer that fee in lieu to a wider range of developers. That will shift what developers bring to us away from water rights and towards financial support to pay for these projects. And then finally, the water rate increase. This is a refresher as to why we need a rate increase, and then I'm going to spend some time on what the rate structure change is and why we are doing that. In 2019, when I got to the city, I started to serve on a task force that had been put together. It included three members of staff, two city councilors—Councilor Romero Worth was on that as well as the chair of the Public Works and Utilities Committee at the time, Chris Rivera—and three members of the public, the rate consultant. One of the proposals that came out of that that we're implementing now is elimination of a seasonal two-tiered structure in favor of a year-round three-tier structure. Essentially, what that does is it rewards people who are low users. There were a couple other proposals that are not being carried forward at the moment. One of them was to look at separating multifamily into either residential or large multifamily. But we looked closer at that data and it didn't justify doing that, so we're not changing that at the moment. We will reconsider commercial rate design in the future, but we're not doing that at the moment. There was also talk about a variable three-tier structure based on winter consumption. But we would do either variable three-tier or fixed three-tier. Because currently we have fixed two-tier, it seems simpler to move to a fixed three-tier. Then if in the future it makes sense for us to consider a variable three-tier, that'll be an easier step to take at that time. How did we choose the size of these new tiers? This graph shows that 75% of our water users use less than 3,000 gallons a month on average. 95% of them use less than 8,000 gallons a month on average, and only 1% of them use more than 17,000 gallons a month on average. That helps us choose these new tiers. Before I explain the new tiers, let me explain the existing tiers. Currently we have two tiers, but they change in size seasonally. In the winter, the first tier goes up to 7,000 gallons a month, and then above that, you pay a second tier rate. In the summer, the first tier is bigger—it's the first 10,000 gallons—and then it bumps up from there. The numbers I'm showing here are the numbers that would be in place in FY27, assuming we start moving rates up. This is not exactly the rates we currently charge. These would be the rates we would be charging in FY27 if we didn't change the structure. That's just to show an apples-to-apples comparison of what the structure change will look like. The proposed future structure is three tiers, shown on the right side. One other thing I should mention is that the ordinance under consideration now would see a rate increase in February of next year, but the rate structure change wouldn't actually happen until January because we're currently implementing a new billing software system and we want that in place before we change the structure. Starting in January 2027, we propose adding a third tier and actually moving the first tier to be lower. For the first 4,000 gallons, everyone will pay less than they're currently paying for that first 4,000 gallons. But then for gallons 4,000 through 7,000, they'll be paying more. Also, gallons 7,000 through 10,000 in the winter, which used to be cheaper, will no longer be cheaper. What does that mean to a water bill? This is with and without the new tier structure. For a low user—this user uses 700 gallons in the winter per month and 2,500 gallons per month in the summer—their bill would decrease both in the summer and in the winter. Their winter bill would go from $25 to $24 with this rate structure change, and their summer bill would go from $36 to $34. In both seasons, their bill goes down with the rate structure change. Don't forget we're also talking about a rate increase. This is specifically the effect of the structure change without a rate increase. For your average user, you see a winter bill going from $45 to $41 and a summer bill going from $56 to $54. For your high user, you still see a decrease in the winter because they are using, although they're using more than 4,000 gallons, they're not using very much more than 4,000. They're going from $51 to $48 in the winter, but in the summer they're going from $163 to $215. That's how we keep the rate change revenue neutral. This structure change won't by itself create any new revenue. It's moving the revenue from the lower users to the higher users. That's typically high use outdoor in the summer, meaning you're using water outdoors. Especially with our new return flow project, this is the beginning of us incentivizing or disincentivizing use of utility water outdoors. This is a projection of what the full city utility bill would look like from FY26 going out for the next six years. The far left is our current structure where the typical user is using 4,200 gallons of water in the summer and 2,800 gallons in the winter. They see a $44 bill. Next February they would see that go to $46 with the rate increase. But then the following January, they would see it go back down to $44 because of this new rate structure. Then it would go up again to $45, $47, and $49 over the next four years after that. That's where I'm getting the five years over $5 per month over five years for the typical water user. This doesn't have any increases associated with environmental services, but it does have the wastewater increases that are already implemented in code. With that, I would be happy to stand for any questions. --- **Chair:** Any questions from committee? Thank you to Jesse. And thank you to Melanie Hobart, who is here and available if you give me any stumpers that I can't answer. **Councilor Castro:** Yes. I usually have some thoughts on the answers that I like. So, Director Roach, I might be talking a little bit about some apps that we have available. But what are programs or support that we might have for residents who would like to use less water? **Director Roach:** Thank you for that question. The ION water app is an app that we have that's available to all water users that allows them to monitor in almost real time their water use down to 15 minutes. You can look at your daily water use, your nighttime water use, your weekly water use, your monthly water use, and you can set up alarms to warn you if you're using more water than a certain amount. That will give you a heads up—maybe there's a leak that you'll see before you see a great big bill. That's a great app for people interested in understanding their water use better and understanding how to reduce it. **Councilor Castro:** Thank you so much, Director. In terms of fixtures, faucets, actual tangible things, do we have any programs for residents? **Director Roach:** Christine, I'm going to let you go ahead and field that one. **Christine:** Councilor Castro, the water conservation section offers rebates for efficient fixtures—toilets, washing machines, dishwashers. We have a pretty big rebate program that will help incentivize that. We're also going to set up our own support for the rate increase and try to determine what other resources we can provide. As Jesse said, the ION water app allows you to basically budget your water use per billing cycle. We're going to try to come up with a way to teach our residents how to do that. **Councilor Castro:** Wonderful. And does that also include rain collection, rain barrels, things like that? Do we get benefits for those? **Christine:** Yes, there are incentives for outdoor irrigation equipment and storm water capture. We're looking at other incentives for outdoor landscapes as well. **Councilor Castro:** Wonderful. No further questions. Thank you. **Chair:** All right. My only question—I'm going to ask for clarity because I know you kind of went over this a little bit. How this will start in February, but the structure won't actually kick in until. Can we clarify just for the public what that actually means and what that's going to look like? **Director Roach:** Madam Chair, thank you for that clarifying question. I'm sorry if I went through that too fast. There are two things happening with this ordinance. One is a rate increase, and one is a rate structure change. The rate increase will start—if this ordinance passes—in February of next year. The bill will look the same. Everything should be understandable. But the average bill will go up, and for that typical user it'll go up about $1 or $2 a month. Then two years out, in January 2027, the rate structure change will happen to what we call the variable water charge. At that point, you'll be paying the same fixed fee, which depends on the size of your service, but what you pay for the amount of water you use will change. We're going to go from a two-tiered structure where the size of the tiers changes seasonally to a three-tiered structure in which those tier sizes don't change. And so right now, you pay a smaller amount for the first 7,000 gallons you use in the winter and the first 10,000 gallons you use in the summer. It'll go to an even smaller charge for the first 4,000 gallons you use any time of year. And then an increase, a middle third tier from 4,000 to 7,000. And then from 7,000 up, that third tier will be the higher tier. >> And you don't need to apologize, Director. You explained everything well, but just to simplify, I'm going to say this and you tell me if I'm right or wrong. So there will be a rate increase of $2 as of February and then based on use two years later, customers will either see a fluctuation down in rate or fluctuation up in rate based on their use of water. Correct? >> That's correct, Madam Chair. And just to clarify, when we talk about a $2 per month average increase, that would be for a typical user, whereas a low user would be less and a high user would be more. But then you are correct that once the structure change takes place, then depending on how much water you use, your bill might go up or down. Looks like most bills will go down in the winter and then the high use bills will go up fairly significantly in the summer. >> Great. Thank you so much for that. And thank you for your work on this. I want to say I've had the privilege to see Director Roach work on this with his team and just his dedication and commitment to tearing this apart and trying to make sure that this is clear and best for the community. I want to say I appreciate that. So thank you, and I'm glad I've been able to witness that because it's been amazing. I appreciate it. >> Thank you, Madam Chair and Melanie. Thank you for being available. Thank you for being here, Melanie. Have a wonderful evening. >> All right. So I think that's it for presentations. Next, there's no discussion, no executive session, so matters from the committee. I will just plug once again that this coming weekend is the Posada and Christmas event on the Southside. And next weekend. I apologize. This is the last week that we're collecting toys for folks. So please, if you have any toys to donate, there are boxes around the city. You can also go to the city website. In particular, we would like to see things for young people, teens, young adults. It's a little bit more difficult to get stuff for them. So thank you so much. >> Thank you for that, Councilor Garcia. >> All right. Matters from Chair. Our next meeting is next year. I don't know the exact date right now. We'll worry about that next year. But we hope to see you all there. And with that we were—