City of Mexico residents will see an increase in their sewer bills in October.

Mexico City Council approved a 3% increase in the fiscal year 2027 sewer rate at the Sept. 28 meeting following a public hearing. The new rate will increase the monthly fee by approximately $1.53, based on 5,000 gallons of water usage. The average residential bill is estimated to be $52.54.

Vicki Duenke, the city of Mexico’s finance director, explained to council members that the proposed rates were based on a few factors. These include daily operations and equipment maintenance; cash-funded capital outlays such as plant structures, the collection system, vehicles and equipment; debt service obligations and reserves replacement.

The approved rates per 1,000 gallons will raise the user fee to $1.58, capital charge to $6.79 and base rate to $10.73. Additionally, users of the collection system who are outside city limits will be billed at 200% of established rates. 

Required revenue in fiscal year 27 is projected at $4,120,040, while total revenue collected is projected to be $4,215,604. 

Duenke estimates that fiscal year 2026 will end with $465,062 in capital outlay and the city has budgeted $1,130,500 in capital expenditures in fiscal year 2027. 

The debt service payments stem from voter-approved bonds issued in 2010 and 2011 to support wastewater treatment plant and collection system improvements. In 2020, the city took advantage of lower interest rates and refinanced its bonds. Rather than taking on more debt, the city has been utilizing a “pay as you go” approach to fund improvements to the city’s wastewater treatment plant and collection system. 

“Our revenue bonds are made semi annually, so those payments get transferred from the wastewater fund into a wastewater debt service fund,” Duenke said. “That helps us stay in compliance with all of our bond borrowing requirements.”

Now, Duenke said the city is gearing up towards repermitting and continuing to prepare for Wastewater Treatment Plant improvements. 

“The staff with the wastewater crew is actually out touring various plants to look at different functions and features in the way they’re designed,” she said.

During the hearing, Duenke reported that the city is on track to have its current round of bonds paid off by 2032.

“We would be positioned to potentially have the borrowing capacity, if we needed, to fund additional improvements at that time,” she said.

According to the council memo submitted by Duenke, from 2015 to 2025, the city has been able to fund in excess of $6.6 million in capital improvements without additional borrowing.