Utility officials warn rising water and sewer costs and unveil infill map to guide development

David Persinger, general manager of the Anchorage Water/Wastewater Utility, told the Community and Economic Development Committee on June 11 that municipal rules and state oversight shape how the utility partners with developers to extend water and sewer service.

"We are a economically regulated utility," Persinger said, explaining that the Regulatory Commission of Alaska approves rates and tariff rules that require similarly situated customers to be treated the same and generally prevent existing ratepayers from subsidizing new development.

Persinger described four main ways utilities are extended: improvement districts (owner-initiated ballots and cost-sharing), private developer-built mains that are later accepted by AWWU, utility capital improvements driven by system need, and infrastructure coordination agreements that blend private and utility investment.

AWWU staff highlighted an infrastructure coordination agreement currently underway with Cook Inlet Housing for parcels near 56th and Cordova Streets. Persinger said the arrangement lets Cook Inlet build the private portion for about 60 targeted housing units while the utility completes complementary looped mains to improve fire flow and system resiliency. "It gives us a much better solution than running dead end mains," he said.

Officials presented data showing the per-foot cost to install mains has increased significantly over the past decade. Persinger and Allison Lang, AWWU assistant general manager, said recent project-level averages have approached $1,000 per foot for water and about $650 per foot for sewer. During discussion, a committee member said a recent local quote amounted to about $350,000 to install 200 feet of water pipe.

Persinger attributed the rise to multiple factors, including post‑pandemic material and labor inflation, limited availability of contractors and materials, and the increasing share of infill projects with difficult topography or constrained right-of-way that make construction more expensive.

To help guide development and public decision-making, AWWU demonstrated a new infill GIS that classifies parcels by proximity to distribution mains and current service status. Red parcels indicate both water and sewer distribution mains in the nearest right-of-way (meaning only service extensions and key boxes are generally required), green indicates sewer-only access, blue water-only access, and beige parcels indicate existing customers already served. Persinger said the utility will ground-truth the map before full public release to remove parks, extremely steep slopes and other non-developable land from the candidate list.

Committee members urged caution about public interpretation of the map. "I think that's a faulty assumption" that all parcels with utility access are developable, said one member, calling for refinement before public release. Members also pressed staff for more detail on the drivers of costs and asked AWWU to provide breakdowns and follow-up analysis.

Persinger said the utility maintains a Planning Counter and staff are available to work with developers and assembly members. "We are here to help you and the public and answer your questions," he said. The presentation closed with requests from members for more granular cost drivers and integrated municipal parcel data to improve decision-making.

Next steps: AWWU will refine and ground-test its infill map before making it public, continue to explore infrastructure coordination agreements, and respond to the committee's requests for cost breakdowns and further explanation of tariff and statute constraints.