Okaloosa County pivots to regional utility role as Shoal River plant nears completion

Okaloosa County pivots to regional utility role as Shoal River plant nears completionWith a $15.9 million capital improvement budget for FY27, the Florida county is expanding its capacity to absorb wastewater flows from neighboring utilities and supply reclaimed water across the region.

The county's new Shoal River Water Reclamation Facility is on budget and slated for a February 2027 startup.

Okaloosa will construct a force main to treat wastewater from Mary Esther, allowing the neighboring city to avoid costly upgrades.

A new I-10 sewer force main will transfer 1 million gallons per day of East Crestview's sewage to the new Shoal River plant.

The FY27 operating budget will temporarily decrease to $41.7 million due to a one-year debt service restructuring.

Okaloosa County Water and Sewer (OCWS) is actively transitioning into a regional service provider, utilizing its expanding infrastructure to support neighboring utilities in the Florida panhandle. The strategic shift was outlined during a July 7, 2026, budget workshop, where officials detailed a $15.9 million capital improvement plan (CIP) for fiscal year 2027. A key driver of this regional approach is the impending completion of the county's largest capital project, the Shoal River Water Reclamation Facility. With major concrete work finished and electrical work scheduled for completion by November, the facility remains on budget and is targeting a February 27, 2027, startup. The new capacity at Shoal River and other county facilities is already being leveraged to assist surrounding municipalities. According to a utility official, the city of Mary Esther recently voted to pursue an agreement with OCWS to install a force main routing its wastewater to the county’s Benny Pritchett plant, allowing Mary Esther to forego an expensive upgrade to its aging treatment facility. Additionally, an I-10 sewer force main project will enable the county to transfer 1 million gallons per day of sewage from East Crestview to the new Shoal River plant, freeing up equivalent capacity at Crestview's existing west side facility. On the water reuse front, a nearly completed three-mile reclaimed water main extension will supply the Niceville water system, providing an alternative source for high irrigation demands that currently tax Niceville's potable system. The utility's financial position remains stable, with rate consultant Stantec confirming that the county's five-year rate structure sufficiently covers the proposed budget. The FY27 operating budget will see a temporary reduction to $41.7 million—down from $43.3 million in FY26—due to a one-year debt service restructuring. Debt service levels will resume the following year as repayment begins on the State Revolving Fund (SRF) loan for the Shoal River plant. Beyond regionalization, the $15.9 million CIP includes $2.5 million for physical equipment and a continued aggressive push on lift station and well rehabilitations. The county is currently completing 14 lift station projects this year, surpassing its target of 10 per year. To further harden its water infrastructure, OCWS plans to construct new buildings for seven unenclosed water wells in FY27 to secure disinfection and electrical systems under a secure roof.