El Paso households will see their monthly water bills increase by nearly $6 on average beginning in March after El Paso Water’s board approved a rate increase Wednesday to fund the utility’s $1 billion budget for 2025.
Water bills have escalated significantly over the last decade to pay for El Paso Water’s multi-billion dollar renovation of the city’s water and sewer systems, and for stormwater infrastructure to limit flooding. Revenue collected from El Paso Water customers funds the utility’s annual budget, which has almost doubled since 2021 when it stood at about $504 million.
The new rates will increase the average El Paso household’s monthly water bill by $5.71, bringing the typical bill for water, sewer and flood control to about $82. That doesn’t include other city charges that are tacked onto water bills, including an environmental fee of $5, a franchise fee of $6 and a charge for a gray curbside trash bin of $21 per month.
“The main budget driver continues to be the need to invest in infrastructure,” El Paso Water CEO John Balliew said during the utility’s board meeting. “Half-a-billion dollar a year capital program is about what we need to keep our head above water, and to gain ground as far as our infrastructure and water supply projects.”
Five members of the seven-member Public Service Board that governs El Paso Water voted in favor of the rate hike. One seat is currently vacant, and the mayor makes up the seventh seat. Mayor Renard Johnson abstained from voting on the utility’s budget on Wednesday.
“I’m new to the Public Service Board, and I think for the taxpayers, I should stay out of this one,” Johnson said.
El Paso Water’s budget for next year is nearly $1.06 billion, which includes the utility’s three units: $956 million for water delivery and sewage – an increase from $889 million last year – and $101 million for the stormwater unit that manages flood control, which is a $2 million increase over last year.
However, El Paso Water isn’t raising customers’ rates across the board. Over one-third of the utility’s household customers may see their bills decrease this year, a move meant to both help some customers better afford their bills and also encourage water conservation.
El Paso households that use just 1 centum cubic foot, or CCF, of water per month – about 748 gallons – will see monthly bills fall by about $10. And customers who use 4 CCFs of water or less will see the $15 water supply replacement charge on their monthly bills waived. El Paso Water said those two changes would apply to about 84,000 of its 220,000 customers, but the utility’s hope is that more households will slash their water usage below 4 CCFs monthly to get a break on their water bills.
From the mid-1970s through 2023, the average amount of water that El Pasoans used every day fell from 225 gallons to 131 gallons per day. In order to keep driving down per-person water consumption in El Paso, the utility has to boost rates, according to Balliew.
“The number one water-conserving tool that we have is the rate-making process,” he said.
El Paso Water’s budget has sharply increased in recent years in part because the utility has been replacing much of the aging water infrastructure in El Paso, where water pipelines the utility operates are a half-century old on average, Balliew said.
El Paso Water has also been developing major capital projects such as the Advanced Water Purification Facility that will serve the Eastside with 10 million gallons of additional drinking water every day, as well as an expansion of the Bustamante sewage treatment plant in the Lower Valley.
The Bustamante plant, which treats Eastside sewage, began approaching its maximum capacity a few years ago amid growth in that part of town. The Texas Commission on Environmental Quality required the utility to expand the facility to treat up to 51 million gallons daily, an increase from 39 million gallons per day currently.
The costs of both projects have ballooned amid economy wide inflation in recent years; the AWP treatment facility has roughly doubled in cost to $300 million and will begin operating in 2027. El Paso Water still has to spend another $757 million to expand the Bustamante plant over the next five years.
Beyond the water and sewer budgets, El Paso Water also raised the stormwater fee on households’ monthly bills from $6.40 to $7.42.
After City Council told El Paso Water to accelerate the pace of its stormwater improvement plan to be completed in 10 years instead of 20 years, the water utility since 2021 has been spending around $70 million annually on flood control projects such as new drainage ponds, dams and basins.
For 2025, the utility budgeted $66 million of spending on capital facilities to help limit flooding in the city.
Balliew said it’s likely that El Paso Water will propose a small increase to the stormwater bill fee next year. After that, the utility may be able to go three or four years without hiking the stormwater fee.
Higher interest rates and the city’s sprawl are contributing to the utility’s budget increase as well.
El Paso Water plans to spend $21 million extra on interest payments this year compared with 2024. And the utility said it expects to spend $126 million this year to provide water and sewer service to newly-built developments. Utility fees on homebuilders cover about $2 million of that cost to serve new growth, and the rest is borne by ratepayers.
El Paso Water since 2021 has also had to spend $120 million to fulfill an “unfunded mandate” by the Texas Legislature that requires the state’s water utilities to provide water for up to three days if the power grid fails and there’s no electricity available, Balliew said.
The law came after Winter Storm Uri in 2021 caused widespread blackouts in most of Texas outside El Paso, which led to interruptions in water delivery and also boil-water notices because of the loss of water pressure in some cities. El Paso Water has been purchasing diesel generators and stocks of diesel fuel over the last couple of years.
For the upcoming state legislative session this year, Balliew said El Paso Water plans to lobby state lawmakers to allow the utility to offer programs to make bills more affordable for some customers, such as elderly El Pasoans or low-income residents.
He said the utility has tried twice in the past to enact similar affordability measures, but didn’t win approval from lawmakers.
“We are going to, once again, try to get authorization from the State of Texas to do an affordability program which is based on income and age status, which we do not have the authority to do right now,” Balliew said.
He cited as a model the San Antonio Water System, which is allowed to offer various discount programs to customers based on income or veteran status, he said.
“But that’s a difficult process. There is opposition to those kinds of things,” Balliew said.
Monthly residential water bills in El Paso increased on average by $3.54 in 2024 and by $9 the previous year. Under the newly-adopted rates, customers will be paying about $220 more for water and sewer service this year compared with average bills in 2022.
The median household income in El Paso in 2023 was just under $59,000, according to the U.S. Census Bureau’s most recent estimate. At the proposed rates that would raise household water and sewer bills to $82.08 on average, or about $985 annually, water costs would account for 1.67% of the median household income in El Paso.
The Environmental Protection Agency and water utility industry broadly considers water and sewer bills that exceed 2% of income as unaffordable for households – so, El Paso would still be below that threshold.
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