Mesquite council hears water-loss audit that finds 25.7% non-revenue water, staff recommends $4.1 million program

The Mesquite City Council received a briefing on a citywide water-loss audit that found non-revenue water — the volume the utility distributes but does not bill — runs significantly above the Texas average and could cost the city millions as a new wholesale contract takes effect.

Consultant Aaron, president of Pulisic Utility Solutions, told the council that after verifying meter and sales data the city's non-revenue water rate was revised down from earlier estimates but still measured about 25.7% of treated supply, compared with a Texas municipal average near 15.5%. "The non revenue water is actually quite a bit higher than your water loss," Aaron said, noting that much of the difference derives from water flushed for quality and large wholesale customer flows.

Why it matters: Mesquite buys treated water through a contract with the North Texas Municipal Water District that will transition to a trailing five‑year purchase formula by 2028. Under that structure, losses will count more directly against the city's average usage and could raise annual costs. Aaron told the council that if nothing changes the city’s current non‑revenue water could cost about $3.8 million a year under the future contract; by contrast, current measured cost was roughly $800,000 per year.

Key findings and recommendation: The audit identified three primary drivers — large amounts of flushing for water‑quality turnover in underutilized southern tanks, wholesale flows that exaggerate loss percentages, and a handful of meter issues. The consultant proposed a multifaceted program (leak detection, pressure management, better flushing controls, asset and pipeline management, and improved data sensing) with an estimated initial cost of about $4.1 million and recurring annual costs around $500,000. Gross annual savings were estimated near $2.3 million, yielding an estimated net savings of about $1.7 million and a payback of roughly 2.7 years.

Council questions and fiscal impact: Council members asked whether AMI meter malfunctions were a material driver; Aaron said fewer than 200 of ~44,000 meters showed anomalies — less than 0.5% — and that flushing was the much larger volume. Deputy City Manager Raymond Rivas and other staff said the Water Fund can likely absorb the initial capital outlay without a rate increase and that cash funding or a future bond sale are both options. "It would not impact the water rate at all," staff said when asked about residential bills for the proposed investments.

Next steps: Consultants recommended a two‑phase approach: a 4–6 month design and site‑survey phase followed by a 9–15 month implementation period to get projects in place before the October 2027/2028 contract transition that will weight the five‑year average. Councilmembers pressed for timely action; staff said a phased procurement and implementation plan will come back for formal approval.

The council did not take a funding vote at the briefing; staff said formal project authorization would be scheduled later.