Short-term Investment, Dividends for Generations

No single generation could pay for an entire water system. We’re still benefitting from investments made by previous generations in the systems that we rely on today to deliver our water. SDS is an investment in our future. Phase I will cost nearly $1 billion, financed with 40-year bonds to share the investment with future customers. Residential, commercial and industrial customers in the four partner communities will help pay for SDS. Colorado Springs Utilities is working hard to reduce project costs.

Project Costs

Phase I of SDS will cost approximately $1 billion to be paid over 40 years. Water users and developers in the four partner communities will cover the cost through rate increases and tap fees.

Cost Savings Opportunities

We are always looking for ways to save money on SDS construction and to complete the project under budget. We are cutting project costs by:

  • Redesign and value engineering. We have saved more than $50 million so far.

  • Monitoring commodities’ prices to get the best value and buying raw materials when prices are low.

  • Maximizing competition among local contractors and benefitting from lower bid prices due to the competitive marketplace.

  • Borrowing money at historically low bond interest rates.

 

Phase I Budget

The budget for Phase I, actual costs tracked to date and the forecast costs for Phase I are shown in the graphic at right.

Phase 1 Budget Process – Actual Costs through April 2013






Water Rates

Water rate increases are needed to pay for SDS. All four partner communities are paying for their share of the SDS project. In Colorado Springs, rates increased 12 percent in 2011 and 2012. The 12 percent rate increases anticipated for 2013 to 2014 will be lower than expected. Water rates will increase 10 percent over the next two years. For the average residential customer in Colorado Springs, that will be about $5.02 more on monthly water bills in 2013.

Rates increases projected for 2015 and 2016 may be even lower or eliminated. While the majority of the increases are needed to build SDS, a portion of the funding is necessary to pay for critical improvements and maintenance of the existing water system

The average household expenditure for water is much less than other common household costs (see graphic below). 
 

 Click on graphics to enlarge.


Development Fees

Development or tap fees for new construction in Colorado Springs have increased by about 138 percent since 2002 to help pay for SDS. That’s an average of $9,000 per new water tap.

 

SDS Phase I

  • Pueblo Dam connection
  • Raw and finished water pipeline
  • 3 water pump stations
  • 1 water treatment plant
  

Contact Us By Mail

Colorado Springs Utilities
Southern Delivery System
121 S. Tejon Street
Colorado Springs, CO 80947

  

For General Questions

Phone: 855-737-4968
Email: sdsinfo@csu.org
Media contact: 719-668-3838
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