New Braunfels Utilities presented an update to the New Braunfels City Council regarding impact fees for water and wastewater services, which were implemented in February 2023.
These fees, designed to help manage the city's rapid growth, are already in effect and are not part of a new proposal.
The two-minute impact
New Braunfels Utilities has recommended an increase in impact fees—a way of proportionally distributing the costs of capital improvements and new development between owners and ratepayers, according to NBU—to address rising infrastructure needs due to the city's rapid growth, as discussed at an Aug. 19 City Council special meeting. Under the proposed changes:
- The water impact fee would rise from $7,989 to $19,448.
- The wastewater fee would increase from $3,251 to $6,244.
The fee hikes come as part of a review mandated every five years under Chapter 395 of the Texas Local Government Code, which City Council last updated in 2022. The new impact fees took effect on February 1, 2023, according to previous reporting.
According to state planning and development codes, impact fees are one-time charges imposed on new developments to offset the costs of necessary capital improvements.
“Impact fees are a one-time charge assessed to new development for costs related to specific capital improvements that support growth,” said Stephanie Neises, group manager at Freese and Nichols, the civil engineering consulting group hired by NBU.
Neises projected significant growth in the city’s water and wastewater needs. The firm’s impact fee capital improvements plan outlines projects essential for supporting this growth through 2023. The plan includes the following major projects:
Water System:
- 27 miles of new water pipelines, with 8.3 miles completed so far
- 5 new elevated storage tanks, with 1 online and 1 under construction
- 2 new pump stations and 3 pump station expansions, some completed
- 19 miles of new wastewater pipelines, with nearly 10 miles in design
- 2 new lift stations and 2 wastewater treatment plant expansions, including the Mackenzie facility under construction
Diving in deeper
The increase in fees could have a ripple effect on housing costs, said Bryan Glasshagel, senior vice president of Zonda–a data firm that provides market analysis in the real estate and housing markets.
- With the existing $25,000 impact fee, it represents about 6% of the average home price in the New Braunfels area.
- For new homes priced around $281,000, the impact fee constitutes approximately 9% of the total home price.
- In higher-end communities like Vintage Oaks, where the average home price approaches $1 million, the impact fee amounts to roughly 2.5% of the home price.
Within the NBU service area, about 20% of new home starts are priced between $250,000 and $299,000, Glasshagel said. Additionally, 40% of new homes are priced between $300,000 and $400,000.
