Kyle Council Picks Between Two Cuts to Outside-City Water Rates
Outside-city customers pay a $92.31 water minimum. Tuesday the council chooses between rates 30% or 20% above in-city rates, a revenue hit of $1.74 million or $2.14 million.
More than 1,100 Kyle water accounts outside the city limits are about to get cheaper rates. The only question is how much cheaper. City Council will choose between two cuts Tuesday.
The council meets at 7 p.m. Oct. 20 at City Hall, 100 W. Center Street, according to the agenda. The council will hold a public hearing, then take a first-reading vote on an ordinance that sets outside-city water and wastewater rates at one of two levels: 1.3 times the in-city rates or 1.2 times.
How we got here
On Sept. 15, the council directed Interim City Manager Perwez Moheet to bring back options that would set outside-city rates no more than 30% or 20% above inside-city rates, according to his staff memo. The memo also mentions a "MUD group" of rate-appeal petitioners. After the council decides, Moheet plans to meet with that group's representatives. He will ask them to sign a settlement agreement accepting the new rates. The MUD group's rate change takes effect only after that agreement is approved and signed.
A city presentation counts 1,129 water accounts and 2,089 wastewater accounts still billed at outside-city rates. That is 7.1% and 10.5% of the system. Another 1,012 water accounts in 6 Creeks have already been changed to inside-city rates.
What the bills would look like
An outside-city home now pays a $92.31 minimum monthly water charge. Under the 30% option, that would fall to $65.90. Under the 20% option, it would fall to $60.83. The first tier of usage, up to 4,000 gallons, now costs $12.21 per 1,000 gallons. That would drop to $9.15 or $8.45.
On the wastewater side, the $39.54 minimum would drop to $31.50 or $29.08. The $7.24 per-1,000-gallon charge would fall to $5.64 or $5.21.
A water tower in Kyle, 2015. Photo: Travis K. Witt / Wikimedia Commons, CC BY-SA 4.0.
What it costs the city
The city now collects $6,931,226 a year in outside-city water and wastewater revenue, according to the presentation. The 30% option would bring that down to $5,190,813, a loss of $1,740,413. The 20% option would bring it down to $4,791,520, a loss of $2,139,706. The gap between the two choices is $399,293.
The new rates would apply starting with December 2026 usage. Meters would be read Dec. 5 through Jan. 5, bills would go out Jan. 28, and payment would be due Feb. 15, 2027. The city plans its next cost-of-service and rate study for March or April 2028. That study would be used to "reconcile and true-up" rates if needed.
The council's options are the 30% ordinance, the 20% ordinance or denial. Because this is a first reading, the ordinance will come back for a second vote.
A busy night
The same agenda includes a notice of intention for about $130.2 million in certificates of obligation for water and wastewater projects. It also includes a report from PNT Law Firm on a council-directed investigation into the relationship between former Mayor Travis Mitchell and the engineering firm American Structurepoint. Residents can speak during the citizen comment period near the start of the meeting.
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