BCRUA water system waiting out market

BCRUA water system waiting out market

By Kara Vaught Friday, 17 April 2009

Construction on phase 1 of the Leander, Cedar Park and Round Rock regional water system is being delayed several months to allow the financial markets to settle before the Texas Water Development Board issues approximately $309 million in bonds to pay for the first portions of the project.

Brushy Creek Regional Utility Authority Project Manager Chris Lippe said he is hopeful the wait will result in a more favorable interest rate.

“We believe [the interest rate] is going to be better than what it was a year ago,” Lippe said.

Water need

The three cities invested in the BCRUA have a combined population of 192,000 and are expected to grow to a total of 609,000 residents by 2040, according to utility authority research. At its final capacity, the regional water system will distribute more than 100 million gallons of water each day, enough to serve Cedar Park and Round Rock’s ultimate resident capacity and Leander’s population for up to 25 years.

Leander, not yet defined by other cities’ boundaries, is not able to provide an estimated build-out population or an estimate of that population’s water needs.

Water bill

The entire three-phase project is estimated to cost $354 million: $182 million for phase 1, $142 million for phase 2 and $29 million for phase 3.

Each city’s portion of the project’s cost is determined by future system usage, and water rates in all three cities have risen. The increases fund both participation in the BCRUA and regular operation and maintenance costs.

Beginning in January 2008, Cedar Park residents’ water bills were calculated on a scale based on usage, which was also intended to promote conservation, said Sam Roberts, assistant city manager.

For residential customers, usage of 2,001 to 10,000 gallons costs $3.21 per 1,000 gallons and usage of 10,001 to 15,000 gallons costs $3.85 per 1,000 gallons. Residents using more than 15,000 gallons a month pay $4.62 per 1,000 gallons.

Cedar Park water customers using less than 2,000 gallons a month saw no increase in their bills, while those who use the system-wide average of 9,400 a month pay $6.02 more with each bill. Commercial customer rates increased by 8.5 percent per month regardless of usage.

Another rate increase is likely in 2010, but has not yet been approved by the city council, Roberts said. The higher rates are expected to generate roughly $90 million in six years.

In July 2007, Leander raised its water rates by 6 percent to $3.82 per 1,000 gallons for both residential and commercial customers.

Round Rock increased its residential water rates by 5 percent in both 2008 and 2009. Its current rate is $2.24 per 1,000 gallons.

The TWDB expects to close July 15 on $309 million in bonds for the BCRUA. Bonds to fund future phases of the project will be issued at a later date.

The water system partnership — rather than three separate systems — will save more than $90 million, according to BCRUA research.

Water fight

Since Leander, Cedar Park and Round Rock formed the BCRUA in 2006, residents of the Village of Volente and homeowners along Trails End Road have opposed the project. The preferred site for a permanent deep-water intake structure is located in the Village, and a raw water pipeline is planned to follow the path of Trails End Road.

Some Volente and Trails End residents are members of the Don’t Empty Lake Travis Association and regularly attend city council and BCRUA meetings to urge officials to abandon the project and seek other sources of water.

Although members of DELTA have often said they are planning lawsuits over the BCRUA’s activities, no lawsuits have been filed.

Bill on water

A bill related to Volente’s objection to the BCRUA project was authored by Rep. Donna Howard, D-Austin, and filed in January. It would require a regional utility authority to receive the consent of a municipality before beginning construction on an intake, pumping or storage facility, a pipeline or any other water-delivery facility within the municipality.

House Bill 722 was left pending in committee March 26. To become law, the bill would need to pass both the house and senate before being sent to the governor.

Cedar Park Councilman Mitch Fuller testified in opposition to the bill in April.

MUDdy water

Under an agreement with Grayson Communities, Ltd., the developer of the Volente Municipal Utility District, a planned 300-lot neighborhood in the Village of Volente, the treatment plant the BCRUA plans to construct in Cedar Park will supply water to residents of the MUD.

The Cedar Park City Council approved this agreement April 9.

Sam Roberts, assistant city manager for Cedar Park, said it will be at least 2011 before homes are built in the MUD that will receive water from Cedar Park.

History

In December 2007, the BCRUA delayed beginning construction to re-evaluate the site selection of the deep-water intake. That research indicated Site 4 is the preferred location of the intake.

Site 4 is favorable because it is farther from neighboring homes, which will allow for less disruption to traffic when construction begins, Lippe said.

The intake site has not been finalized, Lippe said, and neither has the aesthetic design of the intake. The BCRUA will seek community input in those decisions.

BCRUA project timeline

• Phase 1
  • Construction of temporary floating intake structure at Cedar Park’s existing plant on the Sandy Creek arm of Lake Travis
  • Construction of a new raw water pipeline within right-of-way along Trails End Road
  • Construction of a new treatment plant that will serve all three cities with an initial capacity of 17 million gallons per day (mgd) and a capacity of 42 mgd by the end of phase 1
  • Construction of a treated water pipeline across the north side of Cedar Park
  • Cost — Approximately $183 million
  • Expected to begin in late summer 2009 and be complete in 2012
• Phase 2a
  • Construction of a permanent, deep-water intake structure on Lake Travis
  • Raw water pipeline connecting the intake to the phase 1 pipeline
  • Deep-water intake structure will have an ultimate capacity of 142 mgd and will also serve existing treatment plants when necessary
  • Cost — Approximately $100 million
  • Could begin as late as 2016 depending on consumer demand
• Phase 2b
  • Expansion of the new water treatment plant to 84 mgd
  • Cost — Approximately $42 million
  • Plant expansion expected to be necessary by 2018 depending on Lake Travis water levels and consumer demand
• Phase 3
  • Final water treatment plant expansion to a capacity of 106 mgd
  • Cost — $29 million
  • Expansion expected to be necessary by 2028 depending on consumer demand