Hutto approves first wholesale wastewater rates to serve Taylor and Round Rock

Hutto approves first wholesale wastewater rates to serve Taylor and Round RockThe Texas municipality has established a new rate structure to recover infrastructure costs from neighboring cities, setting a combined capacity and volumetric charge for access to its newly expanded wastewater system.

Hutto established a wholesale volume charge of $5.58 per 1,000 gallons based on a five-year estimated average treatment cost.

The City of Taylor faces a proposed monthly capacity charge of nearly $130,000 based on its proportional share of Hutto's $138 million South Wastewater Treatment Plant and interceptor lines.

Round Rock's monthly capacity charge was set at approximately $3,400 due to its smaller proportional use of the infrastructure.

The City Council voted 7-0 to adopt the rate study, providing staff with the basis to finalize pending wholesale agreements with the two neighboring cities.

The Hutto City Council voted unanimously on August 20, 2026, to approve a wholesale wastewater rate study, establishing the city's first-ever wholesale wastewater rates for neighboring municipalities. The decision paves the way for Hutto to finalize pending service agreements with the cities of Taylor and Round Rock. The new rate structure, presented by Jason Gray of Willdan Financial Services, utilizes a standard methodology that separates costs into a fixed capacity charge and a volumetric treatment charge. The volumetric charge was set at $5.58 per 1,000 gallons, representing the average estimated cost of treating sewage over the first five years of the contracts. The fixed capacity charges are calculated based on each city's proportional use of Hutto's wastewater infrastructure. The City of Taylor will face a recommended monthly capacity charge of $129,945.69. This figure is driven largely by Taylor's 9.33% proportional capacity share of Hutto's $138 million South Wastewater Treatment Plant Phase 1 expansion, as well as its 5.77% share of the Southeast Loop Interceptor Phase 2. The City of Round Rock will face a significantly smaller monthly capacity charge of $3,401.73, reflecting its lesser reliance on the shared infrastructure. During the meeting, city staff noted that draft agreements with both cities have been on hold pending the approval of these rates. While Hutto has not yet formally negotiated the exact monthly figures with Taylor, the approved study provides the baseline for final contract execution. Council members emphasized the importance of full cost recovery, ensuring that Hutto's retail ratepayers are not left subsidizing the wholesale capacity reserved for neighboring jurisdictions. In a separate agenda item, the council also reinforced its strict policy on municipal wastewater expansion. Following a presentation by developers of a proposed 102-acre mixed-use project located in the city's extraterritorial jurisdiction (ETJ), the council reached a consensus that no out-of-city wholesale or retail wastewater service would be provided. The developers will be required to voluntarily annex into the city limits to connect to Hutto's wastewater system.