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St. Pete Beach residents could face three consecutive wastewater rate increases under a plan designed to fund major repairs, rebuild system reserves, and end the City’s reliance on general tax revenue to support wastewater operations.
The proposed changes would increase the average residential bill from $95.34 to $144.43 every two months by fiscal year 2030, which is a cumulative increase of about 51.5%. Businesses could see significantly larger increases as the City restructures rates based on meter size and wastewater usage.
On July 28, Commissioners voted to direct staff to continue developing Alternative 1 of a wastewater rate study prepared by consultant Raftelis. Commissioners did not approve the rates, and staff must return with a formal rate schedule for adoption.
The plan calls for a new commercial rate structure phased in over three years while maintaining the existing residential and multifamily structures.
Businesses Could Face Sharp Increases
Commercial customers would see the greatest immediate effect.
Under Alternative 1, commercial customers would pay a base charge tied to meter size and would be billed for all wastewater flow instead of receiving the first 6,000 gallons included in the current base rate.
An average commercial customer with a three-quarter-inch meter currently pays about $141.03 every two months. Under Alternative 1, that bill would increase to about $273.09 in fiscal year 2027 — an increase of nearly 94%.
Businesses with larger meters would also see significant increases:
- A 1-inch meter customer’s average bill would rise from $294.65 to $506.63.
- A 1½-inch meter customer’s average bill would rise from $560.11 to $906.76.
Some residents told Commissioners that larger commercial users, including hotels, should pay a greater share of wastewater costs.
“Why are they getting a pass?” resident Dana Richardson asked. “They need to start paying their fair share and not have the residents and small businesses pay.”
Commissioners also questioned how the changes would affect small businesses that use little water. Staff will continue reviewing how costs should be distributed among hotels, restaurants, shops, and other commercial customers.
[Read more below]
That’s not all that happened at the July 28 St. Pete Beach’s Commission meeting. Read about fees, projects, and events, Fire Station 22, property tax, tourist tax, and valet parking lot.
Wastewater System Needs More Revenue
Raftelis consultant Shawn Ocasio told Commissioners the wastewater system needs a 16% revenue increase in each of the next three fiscal years, followed by a 5% increase in fiscal year 2030.
Without changing the current cost distribution, those increases would raise the average residential bill from $95.34 to $156.24 every two months. That represents a cumulative increase of nearly 64%.
The additional revenue would help cover operating costs, debt payments, and a wastewater capital improvement plan estimated at about $58 million. It would also allow the wastewater fund to rebuild reserves and eliminate transfers from the City’s general fund.
The study identified inflation, limited customer growth, aging infrastructure, and future borrowing costs as major challenges facing the system.
Current System Favors Commercial Accounts
St. Pete Beach currently charges all customers the same $95.34 base rate, regardless of meter size. The charge includes up to 6,000 gallons of wastewater use during each two-month billing cycle.
Customers pay $15.73 for each additional 1,000 gallons.
Raftelis found that residential customers currently pay about 105% of the system’s average cost per 1,000 gallons. Multifamily properties pay about 138%, while commercial customers pay about 77%.
The consultant concluded that residential and multifamily customers are effectively subsidizing commercial accounts.
Residential Bills Could Rise 13% Annually
By shifting more costs to commercial customers, Alternative 1 would lower the proposed residential increase from 16% annually to 13% annually during the first three years.
The average bimonthly residential bill would increase from $95.34 to $107.73 in fiscal year 2027. By 2030, it would reach $144.43, representing an overall increase of about 51.5%.
Multifamily customers would see three annual increases of 9.5%, followed by a 5% increase. Their average bimonthly bill would reach $131.44 by 2030, an overall increase of about 37.9%.
City Continues Exploring County Options
The City also plans to continue evaluating whether Pinellas County could eventually assume control of the wastewater system.
Mayor Scott Tate said county ownership could provide customers with lower and more competitive rates in the future.
The St. Pete Beach Commission’s next meeting is Wednesday, Aug. 19 at 6 p.m.
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