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Northlake staff and consultants recommend modest annual water, sewer increases to stabilize finances
Summary
Consultants recommended a roughly 4.75% annual increase to water and wastewater rates to cover rising wholesale costs and planned capital projects; council was briefed and staff said adoption is scheduled for the council’s December meeting with rates to appear on January bills if approved.
Northlake Town Council received a briefing on proposed water and wastewater rate increases that staff and NewGen Strategies and Solutions say are necessary to cover rising wholesale costs, meet debt-service coverage targets and fund planned capital work. Matthew Garrett of NewGen said the financial plan includes roughly $52,000,000 of capital improvements and the recommended rate design would raise rates about 4.75% per year to maintain fund-balance and coverage targets.
The consultant framed the proposal as a five-year forecast intended to avoid large catch-up increases later: "As mentioned, that's about a 4.75% increase," Garrett said, explaining that without annual adjustments the town’s fund balance drops below its 50% target and debt-service coverage weakens. Staff told council the projection assumes continued growth and approximately a 6% annual increase in connections; Garrett noted that slower growth would require a plan B.
Staff outlined next steps: the council will consider adoption at its December meeting; if adopted, staff would notify residents on the December billing and the new rates would take effect in the January billing cycle. As staff summarized: "On the twelfth would be the item for adoption of these rates, by council, and then... notify residents in the December billing... and then those rates would take effect in the January billing cycle." The briefing emphasized the measure on this night was informational only.
Council members and staff discussed components that affect rates, including increasing wholesale charges from Fort Worth, TRA and Upper Trinity, operating-cost trends and the potential for growth to offset some fixed costs. Questions from council focused on whether the proposed five-year schedule would become automatic; staff said council directed staff to review rates annually rather than lock in automatic pass-throughs, though pass-through ordinances are an option staff could study.
The briefing included examples of how a typical residential winter-average bill would change under the proposal and comparisons with nearby systems; staff noted such comparisons vary because other towns subsidize systems with property taxes. Staff also said they would add customer education, particularly on winter averaging, to help residents manage sewer charges.
The rate adoption remains an action for a future meeting. The briefing and the consultant’s forecast form the basis of staff’s recommendation for incremental, annual increases to keep the utility financially sustainable.
