City of Cape Girardeau

The City of Cape Girardeau City Council considers calling an election and placing on the ballot at the August 5, 2025, General Election a proposal to amend the City Charter such that the annual limitation of fee increases for water, sewer or solid waste does not exceed 15%.

Currently, in accordance with Section 6.13 Fee Limitations of the City Charter, the City shall not increase water, sewer, or solid waste fees by more than 5% in any given fiscal year.

The ballot measure is necessary because the 5% limitation results in revenues from fees that are not sufficient to support, operate and maintain our water system.  In addition, revenues are not sufficient to pay for capital improvement costs required to continue providing the quality and quantity of water our citizens and visitors to the City of Cape Girardeau require.

A yes vote increasing the Fee Limitation of the City Charter would allow the City to establish water, sewer, or solid waste fees by ordinance that are needed, on a fiscal basis, to adequately fund and provide these services to the citizens of Cape.

In November of 2024, the City had a ballot proposal to increase water fees more than the Charter limitation of 5%, and at the same time proposed an ordinance to increase the Water Rates for the City of Cape Girardeau.  That ballot measure did not pass. 

With the current proposed Charter amendment, the City will be able to modify water rates annually by ordinance such that the water system can be operated, maintained, and the investment in capital improvements needed to insure future reliability of the system can be incurred.  The proposed new Charter limitation would, however, place an annual limitation of not more than an increase of 15% in water fees.

The water study commissioned by the City (attached) reported that our current rates were modest and below the affordability index.  The study also reports that without rate increases larger than 5%, attempting to make needed improvements will completely deplete reserves and result in negative reserves by 2027.

The necessary improvements to our water system infrastructure can be funded by modest water rate increases. Current water rates are below the national, state, and regional averages. In addition, regionally and nationally water rates have been increasing. 

Without modification to the Charter limitation, the City will not be able to establish reasonable water rates that will fund our ongoing expenses and capital improvement needs. 

The City operates the water system as an Enterprise Fund.  This type of fund is required to cover the cost of providing services, including capital costs, with fees and charges. Pricing policies of the water fund should be established at rates that support operating, maintaining and improving the water system.  The City of Cape Girardeau, at the current water rates and with the current 5% annual limitation increase, cannot sustain operations and maintenance and also fund planned capital improvements.

Water Treatment Plan Improvements and distribution system improvements totaling $56.5M have been identified and are projected to occur during the next 10 years.   In addition, the next phase of potential improvements have been identified and are projected to total $63.5M.

The team of staff members that have studied the matrix of issues and available solutions for the City, recommends moving forward with the improvements to the City water system, and funding those improvements by amending the City Charter limitation to 15% resulting in the ability to establish annual water rates by ordinance while keeping the water rates in the City reasonable for the customers.  This adjustment is critical to protect the reliability of our water system and ensure that we can continue meeting the City’s needs.