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San Angelo water leaders urge staking out supply, long-term funding as pipe network ages
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Summary
Interim water utilities director Shane Kelton told a Council workshop San Angelo faces large long-term water infrastructure needs — including roughly 300 miles of pipe that could require phased replacement — even as staff pursue new supply projects such as the Concho River reuse project.
Water utilities staff told the San Angelo City Council workshop that the city must both secure additional sources and fund a multiyear rehabilitation program to protect service and support growth.
Interim water utilities director Shane Kelton said the city has roughly 300 miles of water pipe that would need replacement over time and estimated full replacement would be an extensive, multiyear undertaking. "You start looking at that at the cost — that's easily $500,000,000 if you told me to go replace it all today," he said, characterizing the need as long-term and phased.
Kelton briefed council on near-term projects and longer-range supply strategy. He described the Concho River reuse project — a planned treated-reuse source the city is pursuing — and said the program’s estimated cost had been in the hundreds of millions of dollars and that the city expected a Texas Commission on Environmental Quality (TCEQ) draft permit by mid-July. He said that, separate from reuse, the city has added supply diversity through projects such as Fort Stockton Holdings and existing surface and groundwater sources, and that recent investments (for example a new intake or the Hickory project) have improved resiliency.
On routine annual needs, Kelton said a program of annual replacement and rehabilitation would likely require $6–10 million per year to begin addressing critical elements of the distribution and collection systems. He said high-level priorities include trunk main replacements (Sherwood Way and Randolph), north Concho wastewater improvements to retire a shallow lift station, and planning for storage and transmission upgrades to serve growth areas.
"We have to secure additional water resources for our citizens," Kelton said. He told council his department was seeking funding from a mix of sources: Texas Water Development Board loans and grants, federal programs, and potential public-private partnerships to spread costs. He noted the city has been banking FAA-like entitlement-style funds for water utility work — a reference to using available sources, and that the utility has fund balance but that fund balance would not cover all projected projects.
Council members and staff discussed rate-setting and the ongoing rate study under way; Kelton and finance staff said capital needs and annual replacement funding will be reflected in that study. The mayor urged incremental adjustments over time rather than large sudden increases and asked staff to design rate structures that protect low users while recouping infrastructure costs from high-volume users.
Kelton also noted operational threats: inflow and infiltration (I&I) in the wastewater system, sanitary sewer overflows during heavy rains, rising construction and chemical costs, and federal regulatory changes such as PFAS ("forever chemicals") and an updated lead-and-copper rule that could impose unfunded mandates.
Ending
Water utilities presented the Concho River reuse project as a major multiyear priority and asked council to consider a mix of utility rate and outside funding options in the coming budget cycle. Officials said they would return with permit and project details as they become available and with recommended rate-study outcomes tied to capital and annual replacement needs.

