Montrose adopts 20% sewer rate rise for $40m wastewater upgrade bonds
City of Montrose, Colorado · Meeting date: November 2, 2026 · Published: November 3, 2026
Montrose City Council has approved 2027 utility charges including a 20% increase in sewer rates, linking the rise to debt service for wastewater treatment plant improvements, the CIP3 sewer interceptor and the utility share of a new public works facility. Water charges will also rise by 3%, plus a Project 7 Water Authority pass-through of $0.12 per 1,000 gallons.
Key points
- Residential sewer base charges will rise from $33.13 to $39.75 per month, while the volumetric rate will increase from $3.17 to $3.81 per 1,000 gallons.
- The city issued $40 million of Sewer Utility Revenue Bonds in 2026 for critical wastewater treatment plant upgrades and expanded local sewer infrastructure.
- The 2027 sewer budget totals $27.9 million, including $16 million for year-two construction of wastewater treatment plant capital-system upgrades and $2 million for CIP3 sewer-extension construction.
- Residential water base charges will rise from $22.65 to $23.33 per month, and the usage rate from $5.52 to $5.81 per 1,000 gallons.
Full report
Montrose City Council has adopted a 2027 fee schedule that will lift sewer charges by 20%, putting customer revenues behind a $40 million borrowing programme for wastewater treatment plant upgrades and sewer-network expansion.
The rate decision was approved alongside the first reading of the city’s 2027 appropriations ordinance. Staff said the sewer increase was planned to support the sustainability of the fund and debt service associated with the 2026 Sewer Utility Revenue Bonds. The proceeds are to fund wastewater treatment plant improvements, the CIP3 sewer interceptor and the sewer fund’s share of the new public works facility.
The $40 million bond issue, placed through UMB Bank, carries a 5% interest rate payable semi-annually. The city’s 2027 debt-service budget includes $1.8965 million in interest on the sewer revenue bonds.
For residential customers, the monthly sewer base charge will rise from $33.13 to $39.75. The volumetric charge will increase from $3.17 to $3.81 per 1,000 gallons. Non-residential base charges will rise from $24.99 to $29.98 per month, while the sewer connection charge per unit will increase from $4,093 to $4,912. A new $200 sewer retap fee will also take effect.
The city has budgeted $27.93 million for the sewer fund in 2027. This includes $16 million for year-two construction of wastewater treatment plant capital-system upgrades, $2 million for year-two construction of the CIP3 sewer extension, $700,000 for sewer lines associated with the MoveMo street programme, and $200,000 for design of the CIP5 Northern Trunk and Woodgate sewer upsizing. The budget also includes $1.899 million in sewer debt service.
Water customers will also see a smaller increase. The residential monthly base charge will rise 3% from $22.65 to $23.33, while the usage charge will increase from $5.52 to $5.81 per 1,000 gallons. Staff said the increase comprises a 3% inflationary adjustment and a $0.12-per-1,000-gallon pass-through assessment from Project 7 Water Authority for a proposed second water treatment facility south of Montrose.
The city’s water fund budget for 2027 totals $12.72 million, including $1.6 million for MoveMo waterlines, $350,000 for Main Street and San Juan waterline replacement, and design funding for an East Oak Grove booster pump-station replacement.
This summary was generated by AI based on the source document and may contain errors.
Source: City Council Meeting, City of Montrose