FOR - 675 (67.64%)
AGAINST - 323 (32.36%)
(official results)
Lakeway MUD Bond Election Plans for the Future
The Lakeway Municipal Utility District will place a bond authority request before the voters on November 6th. The election will ask for authority to sell tax supported bonds up to $13.3 million. The authority, if approved, will be used for infrastructure improvements for future reliability, to improve safety, and to replace aging facilities. In order to accomplish this, the District’s Board of Directors has identified 19 water and wastewater capital projects that are best funded by using long term bond financing. These projects are planned over the next ten years.
The District’s original authority granted in 1972 was $28 million. It was exhausted in the mid-90s. The District’s voters granted an additional $11.2 million in 1998 to fund a ten year Capital Improvements Plan (CIP), which was used largely to bring the wastewater treatment and recycling capacity into regulatory compliance. That program was completed a few years ago and the capacity is adequate for the next ten year planning period.
The new ten year CIP requires more bond authority. The request for $13.3 million will be used largely for water related projects. There is an urgent need for additional drinking water storage within the distribution system and additional pumping capacity for peak demands. The emergency water supply interconnect pipeline with WCID #17 was built in the eighties and needs increased capacity. It is not used often, but is vital should Lakeway’s water system fail. Water ground storage tanks and cast iron water mains that were installed in the sixties are over 40 years old. The steel tank bottoms are not accessible for maintenance and are corroding. The old iron pipe is getting brittle and increasingly prone to breaks. The solution is to replace the ground storage tanks and the old pipelines. Chlorine gas disinfection at the water treatment plant requires modernization. Near the end of the ten year CIP period, part of the water treatment plant will be 30 years old and need replacement or refurbishing. The total estimate for proposed water projects is over $9 million.
Wastewater projects include replacing some aging wastewater pumping stations and new odor controls. The water recycling system needs additional pipelines to transfer water, and chlorine gas disinfection requires modernization. The District’s maintenance center needs covered storage to protect equipment. The District’s two water recycling plants require fine screens for better solids removal. Fine bubble aeration diffusers will improve efficiency and reduce electric power costs. The total estimate for wastewater projects is over $4 million.
The District plans to sell bonds in three increments; in 2008, 2012 and 2015. The impact on rates was calculated using a “no growth” analysis. This assumes no new customers, no new homes, no increase in existing home values, and no changes in District operating costs. The “no growth” analysis indicates that water rates will peak in 2013, at an additional $6.06 on monthly water bills. In 2015, the peak property tax rate is calculated to rise by $0.0140 (1.4 cents/100) above the current rate of $0.2305. This is an average monthly tax increase of $7.84. The proposed bond’s effects on water and tax rates are modest. There is no change in wastewater rates.
If the District’s voters do not pass the bond authority election, the District will have two options: don’t do the projects or sell revenue bonds which do not require voter approval. Not doing the projects will lead to water rationing during peak summer demand periods, risks of wastewater spills and higher water and wastewater rates due to increased maintenance costs. Leaking water tanks are not acceptable, nor are water mains that repeatedly rupture. Revenue bonds incur higher interest rates and have higher reserve coverage requirements. They are considerably more expensive than voter authorized tax bonds.
The Board of Directors and Committee Members of the Lakeway MUD are your neighbors. They volunteer and serve without compensation. We ask you to vote in the upcoming bond election on Tuesday, November 6th.
-Tom Rogers, President, Lakeway Municipal Utility District