BPUB clears potable reuse and SRWA expansion for $220m SpaceX water fund
Brownsville Public Utilities Board, Texas · Meeting date: October 12, 2026 · Published: October 13, 2026
Brownsville Public Utilities Board has approved a resolution identifying an approximately 8mgd potable-reuse project and a 10mgd Southmost Regional Water Authority plant expansion as qualifying projects under the City of Brownsville-SpaceX funding agreement. SpaceX has already deposited the agreement’s initial $40 million into escrow.
Key points
- BPUB approved the designation of a potable reuse or wastewater-reclamation project sized to add about 8mgd of water supply and an SRWA expansion designed to add about 10mgd.
- The City of Brownsville-SpaceX agreement provides for contributions of up to $220 million: a $40 million initial escrow deposit followed by six quarterly payments of $30 million, subject to its terms.
- The initial $40 million was deposited three days ahead of its September 28 due date and was earning 3.66% in escrow, according to BPUB’s finance presentation.
- SRWA’s optimisation work is intended to restore existing plant production from 7.5mgd to 10mgd; the broader expansion would bring total SRWA capacity to approximately 20mgd.
Full report
Brownsville Public Utilities Board has taken the formal step needed to put two regional water-supply schemes forward for funding from SpaceX’s up-to-$220 million infrastructure contribution.
The board approved a resolution on 12 October identifying a potable reuse or wastewater-reclamation project on the BPUB system, sufficient to support approximately 8mgd of additional supply, and the expansion of the Southmost Regional Water Authority plant, including refurbishment of existing wells and construction of new wells, for approximately 10mgd of additional supply. The projects had already been identified by the City of Brownsville in its September resolution under the City-SpaceX memorandum of understanding and escrow agreement.
The action positions the projects to receive money from the Brownsville Regional Infrastructure Escrow Agreement. Under that agreement, SpaceX’s total contribution cannot exceed $220 million, comprising an initial $40 million escrow payment and six quarterly instalments of $30 million. Funding is subject to project-completion milestones, signed contracts and the other terms of the agreement.
BPUB’s chief financial officer told the board that the first $40 million payment had been deposited into escrow on 25 September, three days before its due date. The funds were invested at 3.66%, down from an initially proposed 3.77% rate. BPUB has no control over the escrowed funds, the chief financial officer said, but is seeking to maximise interest earnings, which would be available for reinvestment in project assets.
The first project component presented to the board was the existing SRWA optimisation programme. It is intended to recover the plant’s existing nameplate capacity, increasing output from 7.5mgd to 10mgd, or by about 2.5mgd. Its listed work includes updating hydrogeological studies, replacing reverse-osmosis trains, rehabilitating or reconstructing 14 wells and constructing two new wells. Six wells had previously been completed and reverse-osmosis membrane replacement was also complete.
BPUB staff said the optimisation scheme supports a subsequent 10mgd SRWA expansion, which would increase total SRWA capacity to approximately 20mgd. The overall programme is expected to be completed in the first quarter of 2029.
The MOU specifies that SpaceX’s contributions are contractual funding for qualifying projects, rather than a purchase or reservation of water capacity, an ownership interest, or a prepayment of volumetric water rates. Separately, following closed-session discussions, the board authorised its general manager and chief executive to negotiate amendments to existing non-standard service agreements or a new non-standard agreement with SpaceX for retail water or wastewater service, subject to board approval or ratification.
This summary was generated by AI based on the source document and may contain errors.
Source: Board of Directors Meeting, Brownsville Public Utilities Board