Council hears proposal to raise water and wastewater impact fees to a $11,056 maximum per LUE

City staff and outside consultants presented an update to Horseshoe Bay’s water and wastewater impact fees during the council meeting, saying the bulk of any increase stems from higher projected capital costs and updated utilization assumptions. Ray Garcia, the city’s utilities director, opened the public hearing by noting the update follows the Water and Wastewater Impact Fee Advisory Committee’s recommendations and the requirements of chapter 395 of the Texas Local Government Code. He said the review aims to keep the fee program legally compliant, financially sustainable and equitable.

Grady Reid, the HDR consultant presenting the technical analysis, said the city’s 10‑year capital improvements and adjusted cost estimates lead to a weighted capital cost of about $7,427 per LUE for water and $5,038 per LUE for wastewater. Because state statute allows rolling the cost of the study into the fee and applying a rate credit, Reid said the committee approved a maximum allowable combined water and wastewater impact fee of $11,056 per LUE and recommended council adopt the maximum as the starting point while retaining discretion to set a lower effective fee.

Council members then questioned how the city defined an LUE and how meter sizes were scaled in HDR’s model. Council member (speaker 3) pressed for LUE scaling tied to actual flow volumes for 0.625, 0.75 and 1‑inch meters rather than treating multiple meter sizes as equivalent. Reid said HDR estimated 345 gallons per day per LUE for supply, treatment and transmission in the model and noted Horseshoe Bay’s internal scaling historically treated many standard meters as equivalent; he acknowledged that changing the scaling factor would change the maximum fee and that the capital committee would have to re‑approve any such change.

After discussion, councilmember Fechner moved — and the council approved — a directive for staff to develop meter‑size scaling aligned with flow-based industry practice and to post a special meeting within the 30‑day statutory window so the council can finalize any ordinance and adopt an effective fee (or choose a lower fee than the $11,056 maximum). Mayor (speaker 2) closed the hearing and set the next steps for staff to present revised scaling options and cost calculations at the special meeting. The council did not adopt an ordinance at the July meeting; staff said the ordinance and the impact fee report must be attached and available before adoption under state law.