Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Water Rates topic
No spam. Unsubscribe anytime.
Llano City Council approves rate package after debate over $225,000 shortfall, 4–1
Summary
After a lengthy presentation and debate about rising debt service and fund shortfalls, the Llano City Council voted 4–1 to adopt 'Scenario 6a' of a proposed water-rate schedule to reduce ongoing losses and address bond repayments; council set follow-up reviews in 12–24 months.
The Llano City Council voted 4–1 to adopt a new water-rate package (referred to in staff materials as Scenario 6a) after a detailed staff presentation that showed the utility fund facing an ongoing revenue deficit driven mainly by recent bond principal repayments.
City staff told the council the utility fund (Fund 20) had anomalous year-to-year entries—including prior ARPA receipts and large capital outlays—that complicated comparisons, but that even with certain rate changes the water operation would show a projected shortfall. The staff member presenting the analysis said, “even with an increase, presented in scenario 6a, the city water revenue will be in a deficit to plan of approximately $300,000,” and urged council to weigh phased options and continued monitoring.
Council members pressed staff for specifics about the size of the deficit under several scenarios and the effects on different customer classes. One councilor restated staff numbers during debate, saying a full “do-nothing” approach could lead to multi‑million-dollar shortfalls; staff and council discussed a range of options including a split implementation of the base fee and a multi-year phase-in to soften consumer impacts.
An earlier motion to implement a hybrid two‑year split of the proposed base increase failed on a recorded voice count (noted in the transcript as a 3–2 split). After further deliberation, a subsequent motion to adopt Scenario 6a carried 4–1. The presiding officer said the council would revisit the rate package and the utility’s financial performance on a roughly 12‑ to 24‑month timeline.
Councilors repeatedly raised concern about the distributional effects of the rate changes. Staff responded that the rate scenarios were intended to shift more of the cost to higher-volume users and to improve long-term revenue stability, but that the choices would have trade-offs for both residential and commercial customers.
The vote resolves the immediate policy choice on rates, but staff told the council they would continue monthly and quarterly monitoring and return with updated financial reports and options as necessary.
