Council reviews $28 million-plus water, wastewater and drainage five-year plan; rate study to follow

Keller — City staff told the Keller City Council on June 17 that the city’s water, wastewater and drainage capital improvement program (CIP) includes about $28 million in outstanding projects, with most work funded through ARPA and SWIFT and several large projects nearing completion.

The presentation laid out cash-funded projects for the current fiscal year, highlighted tank maintenance and pump-station work, and warned of potential future debt issuances to maintain system capacity. “Looking at the current, water waste water activity, we have about, just under 28,000,000 outstanding,” staff said during the work session.

Why it matters: The CIP and the forthcoming rate study will determine how Keller funds operations and large capital projects such as the Pearson pump station repair, water main replacements, and pond-dredging programs. Council members and staff discussed timing of projects, the interaction of water work with roadway CIP, and the city’s ability to avoid capacity shortfalls as development continues.

Key points from the briefing

- Outstanding projects and funding sources: Staff said most outstanding water and wastewater obligations are tied to American Rescue Plan Act (ARPA) projects and SWIFT (the State Water Implementation Fund for Texas). Tank maintenance, pump-station rehabilitation and water-line replacement were listed as priorities.

- Near-term budget: For the current year staff identified about $8.5 million in cash-funded water projects, with two large items noted as the Pearson pump station repair and a materials storage project.

- Annual replacement program: Staff recommended continuing a routine program replacing mains and services at about 400 line-items per year (reallocated across water and street CIP work), and annual water and sewer line replacement funding in the $200,000-per-year range.

- Debt forecast and rate study: Staff showed placeholders for possible debt issuances in later years of the five-year model and said the city will complete a rate study “as we speak” to ensure rates can support the CIP. Council was told there should be a debt drop-off beginning around 2028, allowing room for new capital.

- Wastewater and drainage: Wastewater outstanding principal was stated at about $7.5 million, mainly for the Kaye Branch capacity project and sewer line replacements. Drainage outstanding was presented at roughly $3 million, with planned dredging, pond studies and a $150,000 annual contingency for as-needed drainage repairs.

- Projects already in progress: Staff said many SWIFT and ARPA projects are being finalized and will roll off the books soon. They also summarized several local projects — tank maintenance schedules, pump-station repair timing and dredging work — and noted the city is coordinating some water-line rehab with neighboring jurisdictions under an interlocal agreement that is not yet fully executed.

Council questions and staff clarifications

Council members pressed staff on capacity risk, on whether current development will require added supply or treatment capacity, and on how the city is coordinating with Southlake and other partners on Bear Creek waterline rehab. Staff emphasized their planning focus is to avoid being “behind” on maintenance; they said the master plan shows no immediate capacity shortage but acknowledged work remains to update the floodplain and pond capacity assessments.

Staff emphasized the rate study will incorporate the CIP assumptions and could change project timing or funding needs. They also said drainage fees have not been adjusted in roughly a decade and asked that the rate study consider comparable local fees.

What the council decided

This item was presented for information and discussion; no formal vote was taken on funding decisions. Council members directed continued budgeting work, sought the results of the rate study when available, and asked staff to return with more detail on trade-offs and timing for specific large projects.

Ending

Staff said they will return with the rate-study results and additional details when those analyses are complete; the council gave no new funding commitments at the June 17 meeting.