Oklahoma City Water Utilities Trust adopts $2.7 billion five-year capital plan and approves FY2026 budget

Oklahoma City — The Oklahoma City Water Utilities Trust on May 6 adopted a five-year capital improvement plan totaling $2.7 billion and approved its fiscal year 2026 operating and capital budget after presentations from utility staff.

The trust voted to adopt the capital improvement plan (CIP) and later approved the FY2026 budget during the regular meeting. Haining Schoneman of the Utilities Department presented the CIP, describing a five-year program that allocates more than 60% of funding to water projects, about 35% to sewer and roughly $40 million to solid waste. Vanessa Aguilar, also with the Utilities Department, presented the proposed FY2026 budget and funding sources.

The CIP emphasizes system resiliency and reliability and regulatory compliance. Major water projects cited in the presentation include the Second Atoka pipeline program, Stonewall pump station, on-site chlorine generation at Draper and Heffner water treatment plants, Western Interconnect work, Overholser Dam structural stability work and water-main replacement. For sewer, staff highlighted the Deer Creek wastewater treatment plant expansion, odor-control and electrical improvements at wastewater plants. Solid waste priorities include a solid-waste operations center improvement, cart replacement and equipment replacement programs.

Staff said the CIP totals $2,700,000,000 for the next five fiscal years and that water is the largest single-category expenditure. Schoneman flagged supply-chain and construction-market constraints, equipment lead times and new biosolids regulations, including PFAS-related requirements, as risks that require prioritization and possible deferrals.

Trustees raised questions about the financing plan. One trustee noted the scale of the CIP relative to current annual revenues and debt-service levels: “It’s $2,700,000,000 over 5 years. That’s roughly $700,000,000 a year,” and asked how the trust will cover the program given annual revenues and existing debt service. Staff said projected annual debt service for FY2026 is about $80,000,000 and that the plan includes a PAYGO (pay-as-you-go) component as well as a mix of short-term interest-only financing and long-term financing up to 40 years for some assets. Staff described the funding approach as smoothing revenue adjustments over a 10-year outlook to maintain coverage ratios, and said the financial plan anticipates debt service could nearly triple by the end of a 10-year period while still maintaining the trust’s targeted coverage ratios.

On funding for FY2026, Aguilar said the trust is planning an approximately $1.3 billion ACWAD budget and listed primary funding sources: debt construction fund proceeds (one slide cited $732,000,000 of construction proceeds with $576,000,000 planned for water projects and $156,000,000 planned for wastewater projects), rate revenue of about $517,000,000 for water, wastewater and solid-waste services, withdrawals from reserves of roughly $22,000,000 for projects deferred from the current year, system development charges near $6,000,000, and other smaller sources including flow fees and non-ratepayer activities. Staff described an expected revenue increase driven by rate adjustments and modest customer-growth assumptions; they said about 1.5% of the increase is from customer growth and the remainder from rate adjustments, and indicated a roughly 11% aggregate revenue increase was being discussed in the presentation materials.

Aguilar outlined operational and staffing items in the proposed FY2026 budget, including two new facility/plant mechanic II positions and a planner/scheduler for pump-station maintenance, reorganization to form a financial services division, increased overtime and services-and-supplies budgets to address inflationary costs, and investments in preventative maintenance with an aspirational preventive-to-corrective work-order ratio of 80% to 20%. She also noted increased demand for third-party language-translation services in the customer call center (from an estimated 50 calls per month at pilot launch to roughly 560 calls per month currently).

Trustees moved and seconded approval of the minutes from the April 22 meeting and a consent docket that included amendments, change orders, projects to bid and ratification of payments; both motions passed by voice vote with no roll-call tallies recorded in the transcript. The trust then voted to adopt the five-year CIP and later voted to approve the FY2026 budget. The meeting record shows motions to enter executive session on three pending legal matters also passed; the trust returned to open session and adjourned.

Staff emphasized financial-planning tools intended to preserve bond covenants and coverage ratios while funding the CIP, and they said some large projects will be awarded later in the fiscal year because of financing timing. The presentation noted intent to award delayed projects in the first six months of FY2026 and to focus construction activity in subsequent years. Staff also said construction of segments and pump stations in the Second Atoka program are planned for completion by fiscal 2029 and that Deer Creek expansion design solicitation is underway with construction expected later in the five-year horizon.

Trustees’ comments in the meeting record show attention to debt-service levels and PAYGO assumptions, and staff committed to follow up on certain rate-growth figures and to present supporting detail in future briefings. No statutes, ordinances or regulatory citations were presented in the transcript other than general references to regulatory compliance and biosolids/PFAS issues.

The trust’s actions on May 6 included formal approvals of the minutes, a consent docket, the five-year capital improvement plan and the FY2026 budget; the transcript records each motion as moved, seconded and passed but does not provide individual roll-call vote tallies in the public record excerpt provided.