NBU main plaza

Getting ahead of New Braunfels’ growth to keep the lights on and the water running continues to be a challenge for New Braunfels Utilities.

To keep up with the infrastructure and capacity needed to offset the city’s continuing growth, NBU officials are asking New Braunfels City Council members to approve the implementation of a three-year rate plan that would allow the utility to increase water sewer and electric rates during that period.

NBU CEO Ian Taylor and CFO Dawn Schriewer reviewed utility capacities for water, wastewater and electric and presented the proposed rate plan during a special council session on Monday.

NBU officials have around $533 million worth of capital improvements in the works over the next five years in an effort to keep New Braunfels up to speed. About $386 million of that is water and wastewater capital improvements, with the balance going to electric and service needs.

Taylor said the rate hikes are necessary to pay for current infrastructure improvements and new water acquisitions.

“I’ve been trying for the last four years to get the word out on what the impact of growth has been on utilities,” Taylor said. “It’s affecting critical infrastructure in service providers across town, whether it’s us or other entities. For NBU, ours are really by in large infrastructure and water supply related. It’s consumed capacity in our infrastructure at twice the rate it normally does. The parts of our business that are having the largest infrastructure capacity issues are water and wastewater.”

The proposed water rate increases will be across all classes, but also calls for higher rate increases for commercial and residential irrigation and other high-gallon users that drive the need for the water infrastructure investments.

Under the proposal, water rates would increase by 7% in fiscal year 2021 and by 8% each in fiscal years 2022 and 2023.

However, the plan would also remove the water supply fee for residential customers who use under 7,500 gallons.

For customers using more than 7,500 gallons, the water supply fee would rise to $1.05 per thousand gallons in the first year, $2.49 during the second year and $2.79 in the third year.

With the water supply fee removed, the average residential customer using 6,000 gallons a month would see a lower bill, from $24.08 currently to $23.66 off-peak and from $24.50 to 24.08 on peak, in fiscal year 2021.

That same bill, however, would rise to $25.54 in fiscal 2022 and $27.56 in 2023 off-peak and $26.02 in 2022 and to $28.10 in 2023 on peak.

The plan calls for higher rate increases for commercial and residential irrigation customers.

NBU also plans to initiate a low-income discount program where residents who meet criteria similar to the utility bill assistance program could receive discounts of $3 off their monthly water bill.

Also, NBU plans to roll out a comprehensive utility management plan in March with a specific focus on high use customers and conservation strategies.

“You can’t build water and wastewater facilities as quickly as you can electric,” Taylor said. “The water and wastewater programs are the biggest drivers of our budget right now, and on top of that is water supply. Water, in general, is getting more expensive each year. As we grow and acquire new water supply, that brings on new costs within our portfolio.”

The proposal calls for an increase in sewer rates of 16.5% in fiscal year 2021 and 13% each in fiscal years 2022 and 2023.

The average residential customer using 4,600 gallons would see their bill rise from $38.51 to $44.87 in fiscal year 2021, to $50.70 in 2022 and $57.29 in 2021.

The proposal calls for no increase in electric rates in fiscal year 2021, but a 1.3% increase in 2022 and a 2.6% increase in 2023.

An average residential electric bill would rise from $118.49 in 2021 to $120 in 2022 and $123.18 in 2023.

Taylor said the proposed rates would still keep NBU’s rates among the lowest in the area.

He added that the reason behind proposing a three-year plan is to keep the utilitiy’s high bond rating intact, allowing NBU to borrow at lower interest rates.

“Funding for these projects will come from bonds,” Taylor said. “The rating agencies like to see revenue assurance. That’s one of the big items they look at when they determine the rating for our organizations.”

Fitch Ratings recently affirmed NBU’s ‘AA’ rating for its utility system revenue bonds.

“New Braunfels Utilities takes the responsibility of providing electricity, water, and wastewater for our growing community very seriously,” Schriewer said. “Fitch reviewed our five-year strategic plan and capital expenditures required to support the expansion and development of additional water and wastewater infrastructure and found NBU to be well leveraged in its debt to capital ratio.”

Council members are expected to consider the first reading of the proposed new rate ordinance on Monday.

A second and final reading of the ordinance would come on Oct. 26.

If approved, the rates would become effective on Nov. 1. The fiscal year 2022 rates would go into effect on Aug. 1, 2021 and the fiscal 2023 year rates would go into effect on Aug. 1, 2022.

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(3) comments

James Regan

I concur with Mr. Johnson. Comal County needs to quit letting the developers start new neighborhoods. The city and county see the tax dollars from the new housing, but in reality it is a sugar high once they have to pay for the infrastructure. You can’t even get down 306 in a reasonable time anymore. Now they need to put a turn lane for 35S. Now there will be a McDonalds right there adding to congestion. You can’t build your way out of congestion, but you can stop building new neighborhoods. They need to use the existing housing within the loop or set up the infrastructure ahead of time.

Kimberly Martinez

In regards to http://herald-zeitung.com/community_alert/article_4421572a-0838-11eb-a53c-33523fefbeee.html?fbclid=IwAR055TYAa2NvIsuW84U-pbZDDsN08VAwhq5DhHUlJo3I9w7L5QhyIgRSPvw

I believe that if we stopped building infrastructures and wasting money on things that will cost us more in the long run that we pull our heads out of the holes they are buried in and invest our hard earned tax dollars to create things that would benefit the people and things that this town could profit off of in a more humane way versus having to take more from the people. Times are hard especially now and this news couldn’t have come at a more sensitive time, people are struggling but if you keep pouring this towns money into things senselessly and without fear of the future you will fail horribly. Please keep in mind the many natives of this town who love it here despite the differences this town has shown in one way or another that want to remain here, no offense but this isn’t a cheap town to live in and it isn’t fair to those who struggle respectively that you add more to their plates in wondering how they will survive or where they will go if this becomes to much to bare. Livelihoods are stake, perhaps not yours personally but the ones you fail to think of on a daily basis. Thank you.

Richard Johnson

Why don't we put a moratorium on new residence building until the infrastructure catches up? (This not only includes utilities, but schools, stores, gas stations and other services necessary to support these subdivisions.) Just saying..

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