Typical Lawrence water users should expect about a 4 percent increase in their water rates for 2007.
Whether they'll see much larger increases in 2008 and beyond, though, is uncertain.
The cost to treat water continues to rise faster than the rate of inflation, as are the costs to participate in a program that allows the city to tap into water at Clinton Lake.
"We're comfortable with a 4 percent increase for 2007, but as far as the following year goes, we're going to have to look at it a little closer," said Chris Stewart, the city's interim director of utilities.
The department's cost to buy the seven different types of chemicals it uses to treat water has increased by about 15 percent in the last year. Electricity costs also have gone up by about 15 percent.
A longer-term issue is that Lawrence's contract with the state to pull water from Clinton Lake expires in 2020. Currently, most of the water the city uses from Clinton Lake is bought under a fixed rate. A new contract, though, almost certainly will be under a variable rate, meaning the city and its water users will be more susceptible to price fluctuations.
For example, state officials currently are considering raising prices to communities with variable rate contracts to cover state debt payments for its share of construction and maintenance costs of several federal reservoirs that store drinking water supplies.
"It is tough to predict what is going to happen with that situation," Assistant City Manager Debbie Van Saun said. "But we're not going to be caught unaware by it. We monitor it very closely, and we're going to do the best we can to keep rates as predictable as we can for the community."
Stewart said the city likely would begin negotiations to renew its Clinton Lake water contracts in the next five to eight years.