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Rowlett reports second-quarter revenues above forecast; wastewater costs flagged as risk
Summary
Finance Director Wendy Badgett presented the Q2 report showing $113 million in revenues (73% of the $156 million budget), expenses of $79 million, and a $5.6 million positive variance to quarter forecast; staff flagged about $800,000 of excess wastewater-treatment costs tied to flows to Garland as a budgetary risk.
At its May 19 meeting, the Rowlett City Council received the comprehensive financial report for the period ending March 31, 2026. Director of Finance Wendy Badgett reported second-quarter revenues of $113,000,000, which represent 73% of the $156,000,000 annual budget and exceed the quarter-end forecast by 8%.
Expenses totaled $79,000,000 (about 51% of the revised operating budget), leaving general-fund revenues $5,600,000 above the second-quarter forecast. Property taxes make up roughly 60% of general-fund revenue and accounted for $33,200,000 of the variance; additional contributors included higher interest earnings, inspection fees and timing-related building-permit receipts.
Badgett also reviewed the utility fund: water revenues (about 60% of utility revenue) were roughly $147,000 below forecast while sewer revenues were $173,000 above forecast, leaving the utility fund $185,000 above forecast at quarter-end. Expenses in the utility fund were $296,000 above forecast, driven largely by higher wastewater-treatment costs tied to elevated flows to the City of Garland.
Mayor Winget and councilmembers thanked the finance team and discussed a notable concern: the ongoing investigation into wastewater inflow and infiltration (I&I), which staff said is causing about $800,000 in higher costs to date and could influence future rates.
Badgett closed the presentation by noting that other funds (drainage, debt service, employee health benefits and refuse) met or exceeded forecasts, and offered to answer council questions.
Outcome: council received the quarter-end report and directed continued monitoring of wastewater-treatment cost drivers; no formal action was required.
