City staff updated the council on water and sewer operations related to the FY2026 budget, including a planned decommissioning of the Squabble Creek wastewater plant, anticipated wholesale rate increases from the North Texas Municipal Water District, and maintenance work on lift stations.

Mary said the budget includes funds to dismantle and decommission the Squabble Creek treatment plant and that the site’s track and drying bed would remain for emergency use; staff expect the sewer flow from the north end of the city to route to the southern system and on to Mesquite. Staff said the city has been planning this transition for years and a line-item in the budget will cover dismantling costs.

The presenter said North Texas is proposing a roughly 7.5% increase in treated-water charges (the city’s contract payment to the wholesaler is estimated to rise to $21.01 per unit under the proposal), and that some components of wholesale costs could face larger increases (one component was described as possibly rising as much as 44% in staff materials). The city is conducting a rate study to determine retail customer impacts and staff said the utility fund will need to evaluate rate changes.

Staff noted the city operates 42 sewer lift stations and plans targeted maintenance work, smoke testing and repairs to reduce inflow and infiltration. Staff said past efforts have reduced I&I and that the earlier-than-expected closure of the Squabble plant reflected improved system performance. Wholesale customers and interlocal agreements — including work by RCH toward direct service from North Texas — are still in flux; staff did not assume a full year of revenue from those transitions in the FY2026 projections.

No formal council action was taken; councilmembers asked clarifying questions about reuse of the plant site and the timing of any wholesale-customer changes. Staff said a rate study is underway and noted that some capital work is time-sensitive because FY2026 collections will reflect summer water usage.