Gunnison revisits water rates, leak rules – City restructures usage tiers over dry-year concerns

GUNNISON — Gunnison City leaders used back-to-back meetings in March and April to revisit water rates, utility billing rules and outside-city water service as officials weighed leak problems, drought pressure and future demand on the city system.

The two meetings produced one clear council action and left another major policy question unfinished.

On March 19, the council approved an update to its water rate schedule that added a residential rate tier above 20,000 gallons a month, along with other utility fee changes.

On April 1, the council reconsidered the high-use residential rate structure again, this time delaying implementation until Sept. 1.

The March 19 meeting materials said the average residential customer used just under 5,000 gallons a month during the city’s study period, and that 99% of customers used less than 20,000 gallons, though an average of 12 accounts a month exceeded that threshold, rising to 32.6 accounts between May and September.

At the April 1 meeting, the discussion described the revised structure as affecting about 5% of households.

At the April 1 meeting, council members debated whether to start the higher-use rates sooner or wait until after the peak of the irrigation season.

“My concern is that I’m not so much against changing it, but it’s the time,” Councilman Kim Pickett said. The council chose the later start date.

The rate question also became tangled in a procedural issue. City Recorder Valerie Andersen told the council at the April 1 meeting that the city needed three affirmative votes from the full five-member council to pass a motion, not just a majority of those present.

The March 19 minutes showed the earlier version of the fee update passed 2-1 with only three council members present, and the April 1 agenda listed reconsideration of that earlier action. The problem was resolved by the council voting a second time on the March 19 motion. This time, it passed 4-1.

The council also continued work on Ordinance 2026-02, a broad rewrite of Gunnison’s utility billing rules. The March 19 meeting materials said the ordinance was drafted to clarify utility account setup procedures, update requirements for new connections, add a late-fee waiver provision and revise water shutoff procedures. The council tabled the ordinance that night and returned to it April 1, where it tabled the item again for more work.

Draft language presented with the April 1 packet states that utility accounts must remain in the property owner’s or authorized management company’s name, regardless of any lease or other agreements.

The draft ordinance also reworks delinquency, shutoff and payment-arrangement language. A large part of the April 1 discussion centered on how Gunnison should separate verified leaks from more general waste-of-water cases. Existing city code allows the council to consider terminating service after notice and hearing when a user continues to waste culinary water.

Council members discussed creating a separate leak process with clear notice and repair timelines rather than forcing those cases through the same hearing process used for water-waste violations.

“I would rather do something a little bit separate for those instances, and then leave this wasteful water alone, because I feel like a leak is a little bit different scenario,” Mayor Mike Wanner said.

Wanner said the city could instead issue a direct notice and require repairs within a set time before moving toward shutoff.

Council members also revisited outside-city water service. Existing draft language says applicants outside city limits must obtain council approval through a connection agreement, which includes dedicating culinary or irrigation water shares equivalent to the water they expect to receive from the city.

The April 1 debate focused on whether the city should allow money in lieu of water shares and how much discretion the council should exercise in such cases.

Wanner said he was concerned about allowing development to move forward before the city had water shares in hand.

Another utility issue surfaced April 1 when council members questioned the city’s $500 meter installation fee for vacant lots where service laterals were installed during an earlier water project.

The fee schedule lists a $500 meter installation fee for culinary services. In discussion, council members questioned whether owners of legacy vacant lots should be charged the same installation fee when the service line was already in place. The council did not settle that question and instead directed staff to research the affected lots and return with more information.

The city’s broader water picture also came into focus April 1 during an engineering report. According to the presentation, Gunnison has 1,510 acre-feet of water rights available from multiple sources and used 827 acre-feet in 2025, the lowest annual use in seven years. The report also said Peacock Springs remained below its 510 acre-foot limit.

Officials said various city rights share points of diversion, allowing flexibility among sources so long as total annual use stays within the defined overall rights.
Even with that cushion, the council discussion showed concern about the coming season. “We’ve got Peacock Springs, so we’ll still have some water. In 60 days, we won’t have any irrigation water, J.D. Bunnell, public works director, said.

That concern helped shape the rate debate itself, with council members weighing whether it made sense to impose higher-use charges during what several described as a difficult water year.

The previous March 19 meeting included a separate water-related action tied to agricultural use rather than city taps. The council authorized advertising for the lease of 112 acre-feet of Sevier River rights and 36 shares in the Gunnison-Fayette Canal Co. Meeting materials said Gunnison leased the same water in 2025 and considered it surplus to city needs at this time.

Taken together, the March 19 and April 1 meetings showed Gunnison moving on two tracks at once: Approving a rate change targeting heavy residential use while still trying to rewrite the broader ordinance related to for leaks, late payments, ownership responsibility and outside-city water service.

The council did not finished that ordinance work by April 1, but the discussion made clear city leaders are trying to tighten policies before summer demand increases.