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City News

Posted on: October 11, 2022

FY-2023 Utility Rate Increase Information

Buda Municipal Bldg

 

FISCAL YEAR 2023 UTILITY RATE INCREASE

 

The purpose of this bill insert is to inform you of changes to the City’s water and wastewater rates adopted for Fiscal Year 2023. The adjustments include a 27% increase to the water rates and a 6% increase in wastewater rates. For the typical residential water and wastewater customer, this will mean a monthly bill increase of around $16.20, or an increase of 15%. The new rates will commence with water meter readings in October and will be reflected on your November bill. Each customer’s charges will depend on their usage.

 

WHY A RATE INCREASE?

 

For the last several years, revenues received by the City for water and wastewater service have been higher than anticipated, while expenses have generally been lower than anticipated. This allowed the City to build up a cash reserve within the utility fund, similar to a savings account. In the past, that fund balance has been used to help pay cash for capital projects such as pipeline extensions and water storage within the system. By paying cash for these projects out of this fund balance, the City was able to complete these projects with minimal rate increases needed to fund them.

 

However, over the past two years, the water and wastewater utilities have experienced cost increases for items used to provide service and lower-than-anticipated revenues. Water supply costs have risen as the City works to diversify the sources of its water supply and to prepare for future growth and drought conditions. Wastewater expenses have also increased as a result of expansion of the City’s wastewater treatment plant. The combination of these factors has lowered the amount of money left in the utility fund. In some cases, the City has delayed particular projects until a later time to avoid higher rate increases, but some projects must move forward now. The cost to construct those projects has risen significantly over the past year as the prices of pipe, steel, concrete and other construction materials have increased rapidly. The City is using grant funds secured from the federal government to offset some of these costs, but the grants are not enough to cover the full costs of the projects. In addition, the cost of operating and maintaining the system has undergone significant increases as well in areas such as electricity and chemicals.

 

Given these rising costs and limited utility fund reserves, the City finds the rate increases are needed to create a sustainable utility for our residents. No one likes to see a higher utility bill, and the City will continue to work diligently going forward to keep rates as low as possible. Both City staff and City leadership remain committed to this goal and understanding that low rates must be balanced against maintaining financially and operationally healthy water and wastewater systems. Should you have any questions concerning the water and wastewater rates, please call the City of Buda Utility Billing Department at 512-295-8845 or email utilitybilling@budatx.gov. To track your water usage and set alerts for continuous flow go to the WaterSmart Portal at https://budatx.watersmart.com and sign up.

FY-2023 Utility Rate Increase Information
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