Apple Valley projects 7% utility rate hike amid ongoing PFAS rate study

Apple Valley projects 7% utility rate hike amid ongoing PFAS rate studyThe Minnesota city is bracing for water, sewer, and stormwater rate increases in 2027 as it navigates heavy capital outlay and the loss of a major state stormwater grant.

A pending PFAS rate study is expected to drive a minimum 7% increase across water, sewer, and stormwater rates.

The water and sewer enterprise fund anticipates $17.1 million in 2027 revenue against $18 million in expenses and $8.2 million in capital outlay.

The city's stormwater enterprise fund faces a funding setback following the loss of a $5.4 million state grant.

Officials will evaluate the need for 2028 water and sewer utility revenue bonds to support aging infrastructure.

The City of Apple Valley, Minnesota, is projecting a minimum 7% increase in utility rates for 2027 as it advances a dedicated PFAS rate study, according to a September 10 budget presentation. The projected increase will add roughly $3.98 per quarter to an average residential water bill, $5.20 for sewer, and $3.99 for stormwater. City staff noted they are currently working with a contractor on the statement of work for the PFAS rate study, which will kick off shortly to yield finalized rate information by the end of the year. The rate adjustments come as the city prepares for significant infrastructure expenditures. For 2027, the water and sewer enterprise fund is forecasting $17.1 million in revenue against $18 million in expenses and $8.2 million in capital outlay. Much of the utility capital spending is tied to road reconstruction efforts across the aging municipality, where underground utility services are being replaced concurrently with pavement improvements. Meanwhile, the city's stormwater drainage fund—which anticipates $5.5 million in revenue and $3.4 million in expenses—is adjusting to the loss of a $5.4 million state grant. Looking ahead, city officials indicated they will need to evaluate whether to issue water and sewer utility revenue bonds in 2028 to keep pace with infrastructure demands and road reconstruction needs.