FREQUENTLY ASKED QUESTIONS
Utilities Rate Study
Frequently Asked Questions (F.A.Q's)
In 2019, the City Council commissioned and adopted the City’s first Water, Wastewater, and Reuse Master Plan. The Master Plan identified elements of deficiency, poor performance, and expiring life cycles. The plan also projected future demand and capital improvements requirements.
Further, the Environmental Protection Agency mandated new requirements under America’s Water Infrastructure Act of 2018 (AWIA) for community water systems to conduct risk and resilience assessments.
The act required the work to be done in two phases:
- Phase 1 – Conducting an assessment followed by;
- Phase 2 - Developing an Emergency Response Plan (ERP) for our overall water system.
Doing this work was not optional; it was a legal requirement.
Is there something wrong with our current water and wastewater rates?
One of the goals of the rate study is to determine how accurately the current rates recover the costs to provide water and wastewater services to its customers.
What we do know, is that future investments are needed to meet regulatory requirements to repair aging infrastructure, enhance system resiliency, and enable our systems to perform to the high level of service our customers expect.
Our system is much like an older home starting to show foundation issues. We need to invest in the system now before problems spread and start to damage other parts of the house.
It is important to remember that portions of our current infrastructure are more than three decades old.
Customers will benefit from this study and the new rate structure in many ways.
First, we expect the new rate structure to more fairly allocate our costs to serve each customer so that all customers pay a fair share of their impact on the system, and no one group of customers subsidizes another.
Second, the new rates will enable more investment in the system. The investments the City made a few years ago helped Fair Oaks Ranch come through the 2020 winter storm unscathed, when many other utilities in Texas struggled.
The City is working to design a structure that balances our desire for equity and cost recovery with minimal impacts to bills.
By law, a city cannot charge customers more than what it costs to provide services. Our system operates as an Enterprise Fund and is owned by you, the customer. We do not have shareholders or pay dividends. The investments we make in our water and wastewater systems today are designed to create a reliable, sustainable water and wastewater system for the future.
What is an Enterprise Fund and what does that have to do with possible rate increases?
The utility is supported through charges for services paid by users of the system. An Enterprise Fund is a self-supporting fund that sells goods or services (in this case water and wastewater services) to the public (in this case F.O.R.U. customers) for a fee. The fees should generate sufficient revenue to cover all the costs of providing that service, inclusive of daily operations, maintenance, repair, and replacements.
The Enterprise Fund is separate from the City’s General Fund which means no property taxes are utilized to operate and maintain the utility. As the cost-of-service changes, rate changes are often needed to maintain the level of service that customers expect.
When will the rate changes go into effect?
If approved and adopted by Council, the rates would go into effect with the October 2022 reported consumption and usage data. You will see changes in the bill sent out during the first week in November.
No, the rate change will only affect Fair Oaks Ranch residential and commercial customers that have utility services with Fair Oaks Ranch Utilities. Utility services may include water service, wastewater service, or both.
This rate change does NOT affect residents who are not using Fair Oaks Ranch Utilities. If your water - wastewater service is provided by SAWS or if you have a well and septic tank, this is not applicable to you.
We will be updating our website as well as posting new information on our social media platforms as it becomes available. We are also planning to host open house events in the future to provide residents the opportunity to learn more before City Council votes on the study’s recommendations.
If you have any questions, please email Grant Watanabe P.E., Director of Public Works & Engineering Services.