The city of Lewisville is changing utility rates and rate structures to meet new state guidelines and mandates.
The change will result in an increase of about $4 on the average monthly residential bill, although Lewisville’s utility rates will remain among the lowest in the DFW area.
The city is changing from a uniform flat rate structure to an inclining block rate structure. A uniform flat rate structure charges the same price for every 1,000 gallons of water, while the inclining block rate structure charges a higher price at larger volumes of water.
The rate change is a necessary step to meet capital needs related to maintaining the aging current water system and addressing future capacity demands as the city continues to grow. It also passes along an increase in the charge to the city from Dallas Water Utilities. Lewisville purchases both raw and treated water from Dallas.
The first tier in the new inclining block rate structure captures 90 percent of Lewisville customers. With this new rate structure, the city will continue to include the first 2,000 gallons of usage in the base rate for all customers, as a way to help fixed-income and lower-income customers.
For the typical Lewisville water customer that uses 10,000 gallons of water and has 6,000 gallons of wastewater a month, their bill will increase a little more than $4 per month. Lewisville water customers will notice the higher rates starting on their November utility bill. With this new rate structure, the more water a customer uses, the more they are charged per 1,000 gallons. Conversely, if a water customer uses less water, they will be charged less per 1,000 gallons.
Water conservation remains an important focus for Lewisville residents. During peak summer days, the city’s water system frequently runs near or at its maximum capacity. Using less water helps protect the city’s long-term water supply and saves residents money over time.
Annual funding of $15M-$17M is needed to maintain the city’s utility system. Driving this cost is the expansion and repairs and maintenance of the wastewater and water treatment systems to meet state mandates. Approximately $2.1M in additional funds will be generated from this rate increase. That will increase the City’s annual cash funding of capital needs to $4M. Paying for a larger portion of capital projects using cash in lieu of debt helps the city maintain its “AAA” rating from Standards & Poor’s and Fitch rating agencies for debt issued through its utility operations. The city first achieved that rating in 2013 and it has been reaffirmed every year since. The high bond rating results in lower interest rates when debt is issued.
The city is dedicated to providing residents with quality utility services. The city’s drinking water has earned the ”Superior Public Water Supply” rating, the highest rating given by the Texas Commission on Environmental Quality, and the Lewisville Water Treatment Plant has received the “Texas Optimization Program” award for meeting the most stringent water quality standards. Lewisville was the fourth public water system in Texas to achieve this high level of treatment efficiency.