Water and Wastewater Rates

The City of Kyle is adopting a new rate structure to create a more equitable and sustainable utility system. The revised rates:

• Align charges more closely with actual cost to provide water and wastewater services.
• Ensure all customer classes—residential, commercial, multi-family, and irrigation—pay their fair share.
• Fund critical infrastructure upgrades for long-term water reliability and drought resilience. 

 The City of Kyle’s primary goal in adjusting water and wastewater rates is to ensure all customers pay their fair share of the cost of providing safe, reliable, and sustainable utility services. These adjustments reflect the current and projected costs of delivering service, based on a comprehensive third-party cost-of-service study.  

Rate increases are necessary to fund the Capital Improvement Program (CIP) that will expand our water and wastewater systems to meet the current and future needs of all customers. These projects are essential to meet growing demand, maintain system reliability, and ensure water security for decades to come. 

In 2024, the City partnered with Raftelis Financial Consultants, Inc. to conduct a cost-of-service study and stakeholder review. The new rate structure is based on:

• Critical system improvement costs
• Customer usage data
• Customer class equity
• Financial sustainability 

Because the projects that drive these rates are already underway and ongoing, the City must collect the necessary funding now to ensure these projects can continue without delay. Phasing in rates would slow progress on critical upgrades, risking service reliability and higher emergency costs in the future. 

The cost of providing water and wastewater service is higher outside City limits. Serving these areas requires:

• More pump stations to maintain pressure over long distances
• Extended water and wastewater lines to reach properties
• Lift stations and storage tanks to move and store water effectively

In FY 2024–25, the City increased inside-City rates to better reflect the actual cost of service. Now, we are bringing outside-City rates in line with that true cost, meaning these customers are catching up to the base rates already paid by inside-City customers.

The CIP is a multi-year effort designed to ensure safe, reliable water delivery, support long-term drought preparedness, prevent system failures, reduce maintenance costs over time, and support growth responsibly. Revenue from the updated rates will fund these necessary capital improvements.  Key projects include: 

Recently Completed Projects: 

• Alliance Water Supply Activation (May 2025): First delivery of water from the Alliance Water project began in May 2025, expanding the city's water supply capacity by 26.7%—an additional 1.73 million gallons per day (MGD).
• Green Valley SUD Agreement (March 2025): Approved in March 2025, this agreement added 0.652 MGD to the city’s current water supply, with capacity increasing to 1.42 MGD over time. 

Combined, the Alliance Water and Green Valley SUD agreements have increased the city’s total water supply by 2.37 MGD, a 37% increase in overall capacity. 

Ongoing Projects: 

• SCADA System Replacement – Updating our Supervisory Control and Data Acquisition system to improve system monitoring and control, making our water system safer and more reliable.
• Citywide Pump Station Improvements – Upgrading and expanding stations to maintain reliable service and the ability to move water across the city efficiently.
• Wastewater Treatment Plant (WWTP) Expansion – Increasing capacity to 9 MGD serve a growing population.  
• FM 1626 Expansion / Third Alliance Water Take Point: Design is underway for an new expansion at FM 1626. This site will serve as the city's third water take point from the Alliance Water system, enhancing distribution reliability and redundancy.
• AMI Water Meter Change-out (Digital Metering Upgrade): A citywide upgrade is in progress to replace thousands of analog water meters with advanced metering infrastructure (AMI). These new digital meters will allow for more accurate and efficient readings, with project completion expected by late 2025.
• Aquifer Storage and Recovery - In June of 2025, Kyle City Council , approved a contract with STV Infrastructure, Inc. for an Aquifer Storage and Recovery (ASR) project, a key water supply strategy outlined in the City's Water Master Plan

For information on the projects funded by water and wastewater rates, go to the City’s Open Gov Portal.

Yes. The City charges a base monthly minimum determined by your meter size, but the majority of your bill is based on how much water you use. Kyle’s water rates are tiered based on volume—calculated per 1,000 gallons used each month—and this structure applies across all customer classes, including single-family, multi-family, commercial, and irrigation accounts. This means:

• The more water you use, the higher the rate per thousand gallons.
• The tiered system encourages water conservation.
• Heavy water users pay proportionally more for the greater demand they place on the system. 

The rate increases have been introduced gradually to reduce the impact on residents. The City has also updated impact fees so that new development — not current residents — helps cover the cost of growth-related utility expansions.