Council approves utility service agreement to expand water permit capacity

The Zephyrhills City Council unanimously approved a utility services agreement with landowners represented by Hobby & Hobby, P.A. that transfers permitted water capacity to the city and is intended to support projected development in the city’s utility service area.

City Manager Billy introduced the utility services agreement, saying landowners have four wells permitted at 790,000 gallons per day and that the planned development would use roughly 650,000 gpd, leaving about 140,000 gpd available to the city under the proposed arrangement. The agreement requires the landowners to transfer their water-use permits to the city and allows staff to seek an amended water-use permit from the Southwest Florida Water Management District (SWFWMD).

The council’s action follows months of technical review and modeling. Clark Hobby, attorney for the landowners, told the council the arrangement is intended to allow Zephyrhills to secure a larger overall permit from SWFWMD. Hobby said the district has been part of the conversation and is awaiting the executed agreement to finalize the city’s permit amendment.

Under the approved agreement the city will: - Accept transfer of the landowners’ water-use permits and apply to SWFWMD to increase the city’s permitted withdrawal (the city’s target number was discussed in the meeting but depends on SWFWMD’s review); - Reserve up to 650,000 gpd for the development while holding approximately 140,000 gpd of capacity for the city’s use (figures in the meeting reflect the applicants’ estimates and the reservation term negotiated); - Require each phase of development to connect to city water and wastewater at designated locations and to pay normal capacity fees and rates.

The agreement includes a 15-year reservation period for the developers’ allocated capacity, with an extension possible for extenuating circumstances. Staff said the reservation term resulted from negotiations; city staff initially sought a shorter term and the property owners had proposed a longer one.

Council members pressed staff on whether the arrangement would allow the city to lift or modify its moratorium on new water connections. City staff said that completion of the SWFWMD permit amendment is a separate regulatory step and that the city will need to make a policy decision about the moratorium once the amended permit is issued and implementation details are settled. Staff also explained the city would not be connecting directly to the landowners’ agricultural wells; rather, the transaction allows the city to secure additional permitted withdrawal capacity and then manage production and monitoring as part of the city’s system.

The council voted 7–0 to approve Utility Services Agreement No. 45-25-18.

What happens next: staff will submit the executed agreement to SWFWMD and pursue the city’s permit amendment. The agreement requires follow-up steps, including placing monitoring infrastructure, confirming physical interconnect points and finalizing any easements or conditions SWFWMD requires before the city can rely on the expanded permitted capacity.