Round Rock City Council approves future utility rate hikes

In order to keep up with the costs of infrastructure demands, capital improvements and an expanding water supply, the City of Round Rock is increasing its water and wastewater rates for residential and commercial customers.

On May 9, Round Rock City Council unanimously approved an ordinance that will allow the city to raise customers' rates for two consecutive years beginning in 2015. In the first year, Round Rock residents will see a 2.5 percent increase in their volume rates and monthly service charge over their current rate. In 2016, the rates will increase by another 3 percent.

For the average Round Rock residential utility customer who uses 10,000 gallons of water and 8,000 gallons of wastewater per month, the rate changes will translate into a monthly bill increase of $1.85 in 2015 and another $2.32 in 2016.

"Whatever our costs are, that's how we set our rates," said Michael Thane, Round Rock Utilities and Environmental Services director. "We have to pay for operations and maintenance and capital—and that is how the rate is established."

Thane said the city reviews its water rates approximately every three years to make sure its revenue stays in line with its expenses. He said the rising costs associated with raw water contracts, chemicals and regulatory mandates have contributed to the need for the city to increase its rates.

"Because of those things, water is becoming more expensive to push around," Thane said.

The looming rate increase is the city's first since 2010, when customer rates rose by 6 percent. According to data collected by the city in September, Round Rock water and wastewater rates remain some of the lowest in the Greater Austin region, trailing only Georgetown and Taylor in combined cost.

In 2012, Round Rock residents paid an average monthly water bill that was $19.44 less than Pflugerville residents and $42.09 less than Hutto residents. For wastewater, Round Rock's average residential bills were $2.42 more than Pflugerville's and $11.82 less than Hutto's.

The new rate increases are also being timed to coincide with Round Rock's planned hookup with water from Lake Travis through the Brushy Creek Regional Utility Authority, or BCRUA, project. The BCRUA is a $131 million, three-city cooperative water supply project funded by Round Rock, Cedar Park and Leander with the eventual capacity to provide Round Rock with up to 40.8 million gallons of additional water per day.

Put into perspective, Round Rock's current peak water usage during summer months is about 40 million gallons per day, said Round Rock Councilman George White, who represents the city on the BCRUA's board of directors.

"[The BCRUA] is the first [project] of its type in the state where three municipalities partnered in a water treatment facility," White said.

Although Cedar Park and Leander have already begun pumping water through the BCRUA plant, the City of Round Rock has yet to complete the lines connecting it to the project. Once those are completed, White said he expects the city to begin importing water from Lake Travis in 2016.

The obvious benefit of the BCRUA for Round Rock is the increased access to water. However, funding the project, along with the higher price of Lake Travis water in comparison with the city's current cost of pumping Lake Georgetown water, will likely result in future increases in the water rates.

"[Lake Travis water] will be somewhat more expensive," White said.