Llano City Council debates dam rehabilitation, storage options and $3.5 million grant

Llano City Council spent the bulk of its meeting debating options to secure the city’s water supply, focusing on whether to use a $3.5 million foundation grant and associated loan to study and potentially rehabilitate or raise the city’s dam.

Councilmember Kara, who led much of the discussion, said the grant and loan were intended to pay for studies: “The money from the foundation, our 3 and a half million dollar loan and grant, the purpose of that grant was to do the studies to evaluate the dam structural integrity as they sit as well as if we were to increase the height of the dam,” she said. Kara told the council such studies would also cover FEMA impact analysis and permitting needs.

Speakers and residents raised a range of technical and financial questions: one resident asked whether the grant explicitly allowed raising the dam, and a council member replied that the grant covers dam rehabilitation and related studies, not necessarily obligating construction. The council heard that a $7 million figure cited was a probable construction cost that excluded project management and oversight, and that unused grant funds could be returned while studies already paid for would not have to be repaid.

Several members and residents emphasized the need to understand storage limits and regulatory constraints under the Texas Commission on Environmental Quality and state water planning (Region K). Councilmember Kara summarized options identified by consultants and past studies—rehabilitation, dredging, raising the dam, negotiated upstream diversion agreements and seeking expanded firm water contracts—and asked whether the public favored a single solution or a combination.

Councilmember and resident comments repeatedly urged public workshops and engagement. One council member framed the next step as informational: “We need to know is when I finish this, right, what do we need? ... Are you in favor of raising the height of the dam or increasing storage capacity in any manner? Are you in favor of just dredging?”

Finley, the city manager, confirmed staff will not spend city funds on those studies if the grant money is available: the recommended approach is to use grant funds for technical studies first and only move to construction if studies and permitting indicate a feasible path.

The council did not take a final vote on policy direction during the meeting. Instead, members agreed to schedule targeted workshops, invite engineering consultants and a water-rights attorney to present findings, and assemble clearer cost and permitting scenarios for future deliberations.

Next steps: staff will draft a workshop schedule and scope of work for consultant presentations and legal review; council requested estimates of what each option (rehab, raise, dredge, or contract) would require in permitting, cost and timeline.