Dalton Utilities has officially adopted its budget for 2026, reflecting a significant increase in projected healthcare costs. The anticipated rise has escalated to 27.9%, up from an earlier estimate of 20%. This adjustment represents the only major change made to the budget since its initial unveiling in November.
During a discussion following the November meeting, CEO John Thomas noted that Dalton Utilities is facing similar challenges in health insurance costs as other employers across the country. He stated, “Our understanding is that entities all over the country are experiencing noticeable increases in healthcare costs.” Backing this statement, a recent survey by the Business Group on Health found that large employers are forecasting an average growth of 10% in healthcare costs for the upcoming year, with more substantial increases anticipated by some.
The approved budget includes a 5% increase in electricity rates for residential, commercial, and industrial customers. This adjustment is expected to add an average of $9.25 to residential bills. Water and wastewater services will see similar increases, with an average rise of $1.67 for water and $2.12 for wastewater bills for residents in Dalton. Customers outside the city will experience average increases of $2.01 for water and $2.37 for wastewater.
Notably, the budget does not introduce any rate increases for natural gas or for OptiLink cable services. Commercial customers within Dalton will face a 6.73% increase in water rates and a 7.96% increase in wastewater rates. For those outside the city, the increases will be 11.32% for water and 8.38% for wastewater.
Utility officials explained that these increases are necessary to address rising operating costs. “All sectors have unique influences, but in general, costs associated with materials, contract labor, and equipment are increasing,” Thomas stated. He also highlighted that the electric sector would likely see substantial increases in purchased electric capacity costs starting in 2028, necessitating gradual rate adjustments now to prepare for future financial demands.
The budget outlines an operating revenue forecast of $326.714 million, an increase from $294.208 million in 2025. Operating expenses are projected to rise to $278 million, up from $266.684 million in the previous year. The anticipated operating margin stands at $47.714 million, a decrease from the $989,576 initially estimated in November.
Revenue generated from Dalton Utilities typically supports three main areas: investment in facility maintenance and expansion, debt service obligations, and payments to the city’s general fund. Under current regulations, the city requires the utility to pay the greater of $10 million or 5% of its revenue each year.
As Dalton Utilities navigates these budgetary challenges, the utility remains focused on ensuring reliable service while addressing the rising costs that impact both their operations and customers.
