Boynton Beach tables 17.25% rate hike amid $325m PFAS compliance sticker shock

Boynton Beach tables 17.25% rate hike amid $325m PFAS compliance sticker shockCity commissioners pushed back against a steep utility rate increase intended to fund imminent federal PFAS mandates, demanding staff seek alternative funding to alleviate the burden on ratepayers.

The city faces an estimated $325 million in capital costs to implement PFAS treatment at its two water treatment plants by 2029.

A proposed 17.25% rate increase for FY2027 was tabled after commissioners expressed concerns over affordability.

The utility has secured $5.4 million in principal forgiveness loans but must issue revenue bonds to fund a $500 million five-year capital plan.

The city's water treatment plants, aged 65 and 45 years, require comprehensive overhauls alongside the new regulatory mandates.

Faced with a massive capital funding requirement to meet federal PFAS regulations, the Boynton Beach City Commission voted on September 8 to table a proposed 17.25% utility rate increase for fiscal year 2027. Utilities Director Poonam Kalkat and rate consultant Ryan Smith presented the rate adjustment, explaining that the increase is primarily driven by the need to install PFAS treatment systems at the city's two water treatment plants. The facilities, which are 65 and 45 years old, require comprehensive overhauls to meet the EPA's 2029 compliance deadline. Smith noted that the financial forecast includes $325 million in improvements for both facilities, a figure that incorporates a contingency buffer to account for fluctuating project costs and interest rates. The total five-year utility capital improvement plan is projected at approximately $500 million. To finance the upgrades, the utility plans to secure revenue bonds. Kalkat warned the Commission that the regulatory mandates are unavoidable. "If we cannot meet those requirements, we will be in violation, and violations means... EPA will ask us, what is your plan to meet it?" she said, adding that the city has already secured a $5.4 million principal forgiveness loan but must find additional avenues to fund the remaining balance. Despite the urgency, commissioners balked at the 17.25% single-year rate jump. While acknowledging the historical deferment of plant maintenance and the necessity of the upgrades, multiple commissioners cited the financial strain on residents living on fixed incomes. Smith attempted to contextualize the increase by noting that Boynton Beach's current rates are highly competitive. For a typical single-family residential customer using 5,000 gallons a month, the average water and sewer bill is approximately $65—about $25 below the average of surveyed South Florida peer utilities. Even with the proposed increase, the monthly bill would rise to approximately $77, keeping the city below the regional average. However, the Commission rejected the comparative justification and directed staff to explore alternative mathematical models and aggressively pursue additional federal and state grants. The rate resolution was tabled and will be reworked before returning to the Commission for a final decision prior to budget adoption.