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Agua SUD holds public hearing on proposed water, sewer rate increases

The Agua Special Utility District held a public hearing Monday on plans to slowly increase water and sewer rates during the next five years.

Jeff Snowden, a consultant with Frisco, Texas-based Capex Consulting, started studying the water and sewer rates last year.

AguaSUDLogo“We’re really not recommending any more than the bare minimum,” Snowden said. “Very modest rate increases.”
The utility district would run a deficit by 2023 without modest water and sewer rate increases, according to the analysis Snowden presented Monday afternoon.

Slowly increasing rates will allow the utility district to cover operating costs, make debt payments and maintain a healthy fund balance.

“What I’m recommending are reasonable rates that will provide surplus cash so that we’ll have capacity to borrow more for system growth and repairs over the next five years,” Snowden said. “We’re not recommending rates that will throw off a bunch of extra cash without a home, without a justifying need.”

The proposal would affect more than 15,500 water customers across western Hidalgo County, along with sewer customers in Sullivan City and Palmview.

Under the proposal, the monthly base rate for residential water customers would increase from $16.53 per month to $17.75 per month by 2023.

The utility district would also charge more for every 1,000 gallons.

Customers who use 3,000 to 10,000 gallons of water per month currently pay $2.36 per 1,000 gallons. The utility district would increase the price every year, bringing the cost to $2.75 per 1,000 gallons by 2023.

Snowden walked the utility board through a presentation that showed how water and sewer rates would increase slightly every year.

In several instances, the presentation Snowden showed the utility board Monday included slightly higher rates than he proposed in August and November.

When he met with the board on Aug. 4 during a three-day workshop on South Padre Island, the presentation included a slide with the heading: “Proposed Residential Water and Wastewater Rate Increases.”

The slide stated that a customer who pays $72.97 per month for water and sewer service would pay $81.22 per month by 2023.

When he met with the board again on Nov. 5, the slide showed the cost increasing from $72.97 per month to $85.19 per month. And on Monday, the same slide showed the cost increasing from $72.97 per month to $85.48 per month.

“Assuming everyone else in the Valley raises their rates by 3 percent a year up to 2023, which is a low number, you’re one of the best values in the Valley under these rates,” Snowden said.

The utility board will hold additional public hearings on March 4 and April 1.

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