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Commission approves MPU buyout of Sherryland areas; customers to remain on Sherryland rates until reimbursed
Summary
McAllen Public Utility informed the commission it purchased two water-supply buyout areas (Buyout 7 and 8) covering roughly 176 acres; residents will remain on Sherryland Water Supply Corporation rates until reimbursement triggers conversion to MPU rates.
The commission adopted an ordinance authorizing McAllen Public Utility’s acceptance of utility buyout areas known as Buyout 7 and Buyout 8, an area staff described as northwest McAllen bordering Ware Road and Trenton.
Mark Vega of McAllen Public Utility explained the buyout areas will continue to pay Sherryland Water Supply Corporation rates until the buyout is reimbursed; once developers reimburse the buyout area the customers’ accounts will be converted to McAllen Public Utility rates. Vega said the shaded area shown in the exhibit covers about 176 acres and that two developers already have projects in the area, which will accelerate reimbursement as development occurs.
A commissioner noted that Sherryland rates were roughly 25–30% higher than MPU rates; staff said the buyout practice protects existing ratepayers from subsidizing new areas until reimbursement is complete. The ordinance passed on a motion recorded in the transcript.
