The Casa Grande City Council unanimously approved Resolution 5820 on September 15, allowing the city to enter into an agreement with Arizona Water Company for data sharing and water service disconnections. However, the agreement comes with costs that will require wastewater rate increases. City Manager Larry Rains noted that due to agenda issues, the council will return October 6 to formally start the rate increase process required for the agreement.
Unique Utility Structure Creates Collection Challenge
Casa Grande operates under an unusual utility arrangement that has created significant billing challenges. The city provides wastewater services while Arizona Water Company provides water service to most residents.
This split arrangement has left the city without effective collection tools. “Because the sewer system is largely gravity-fed, it’s difficult for the city to have teeth, so to speak, to be able to go after people that aren’t paying their bills,” explained Robert Aldous, Assistant to the City Manager.
$2.2 Million in Uncollected Revenue
The collection problem has reached significant proportions. Aldous reported that “there’s approximately $2.2 million that the city should have collected in sewer bills but has not collected.” This figure represents only current outstanding balances and doesn’t include previous write-offs.
The unpaid bills create a financial burden for paying customers. “If some customers aren’t paying, then the customers who do pay then have to cover that extra cost and have essentially rates increased in order to cover those costs,” Aldous explained.
The city previously tried a collections agency with little success and currently uses a lien program that typically results in payment only when properties are sold or refinanced.
Agreement Provides Collection Tool
The approved agreement gives Casa Grande the same collection leverage used by other utilities. Under the agreement, Arizona Water Company will disconnect water service to customers who are more than 90 days delinquent on their sewer bills and have refused or defaulted on payment plans.
The city must offer payment plans and provide at least 10 days’ written notice before requesting disconnection.
Other cities using similar agreements have reported quick results, with customers typically paying within two days of disconnection.
Data Sharing and Fees
Arizona Water Company will share monthly billing information with the city to help identify customers who receive water service but aren’t paying sewer bills. This replaces a 2018 agreement that shared more extensive data. The information includes basic account details and water usage, but no sensitive information like credit card numbers.
The agreement includes several fees that will result in higher costs:
Fees for delinquent customers:
- $100 disconnection fee
- $50 after-hours reconnection fee (in certain circumstances)
Costs spread among customers who receive both water and sewer service:
- $1,000 one-time setup cost (paid by city, recovered through rates)
- 50-cent annual administrative fee per customer
- Variable costs for lost revenue and equipment damage
The city will hold a public hearing on November 17, 2025, to consider the rate increases needed to cover these costs.
Implementation Timeline
Before the agreement takes effect, Arizona Water Company must obtain regulatory approval from the Arizona Corporation Commission, a process expected to take three to six months. The commission has previously approved similar agreements for other cities.
Once approved, the city plans a public outreach campaign to inform residents about the new policy before beginning disconnections. Water disconnections will occur Monday through Thursday only, excluding holidays.
The agreement allows either party to terminate with 60 days’ notice and excludes multi-unit buildings sharing common service lines.
