Tarrant Regional plans $350m bond issuance to fund pipeline replacements and reuse projects

Tarrant Regional plans $350m bond issuance to fund pipeline replacements and reuse projectsThe Texas wholesale water provider's $223.7 million FY27 budget marks a transition into the heavy delivery phase of its five-year capital plan, driving up debt service and operational headcounts.

TRWD's proposed FY27 revenue fund budget totals $223.7 million, a 12% increase from the previous year.

The district will issue $350 million in debt to fund major projects, including the Cedar Creek pipeline replacement and the Mary's Creek Reuse supply.

Wholesale water rates will rise 5.4% to $1.50 per 1,000 gallons, with staff warning of potential future increases up to 10%.

The district is adding 21 full-time positions to manage the expanded infrastructure and a $1.4 billion portfolio of active engineering contracts.

The Tarrant Regional Water District (TRWD) in Texas is preparing to issue $350 million in debt during fiscal year 2027 to finance the heavy delivery phase of its $2.3 billion, five-year capital improvement program (CIP). During a July 7, 2026 meeting, district staff presented the proposed FY27 revenue fund budget, which totals $223.7 million—a 12% increase over the previous year. The budget will drive a 5.4% increase in the wholesale system rate, bringing it to $1.508 per 1,000 gallons. TRWD provides raw water to more than 50 wholesale customers, including the cities of Fort Worth and Arlington. The $350 million bond issuance will primarily fund projects addressing rapid service area growth and aging infrastructure. Growth accounts for 72% of the district's projected five-year CIP expenditures. Key growth projects include the Marty Leonard Wetlands, the Mary's Creek Reuse supply, and an Integrated Pipeline connection to the Richland-Chambers Reservoir. Meanwhile, aging infrastructure accounts for 16% of the five-year CIP. A major driver of near-term spending is the replacement of the 50-year-old Cedar Creek pipeline, which is being upgraded with 90-inch and 102-inch welded steel pipes to increase transmission capacity. Debt service will be the largest single expenditure in the FY27 budget, rising nearly 21% to $102.6 million. Staff indicated that as the CIP progresses, the district could see system rate increases of 6% to 10% in the coming years. To manage the expanded infrastructure and the $1.4 billion currently under contract, TRWD is adding 21 full-time equivalent positions in FY27, bringing the revenue fund headcount to 274. The new hires will include construction inspectors, operations personnel, and engineering staff. District management noted that bringing construction inspection in-house yields significant long-term savings, as those inspectors eventually transition into operations roles to maintain the assets they watched being built. To mitigate the rate impact, TRWD has implemented several cost-saving measures. The district renegotiated original equipment manufacturer maintenance contracts for variable frequency drives, achieving an 8% reduction in recurring pipeline and pump station maintenance costs. Additionally, the district deferred a $1.4 million cathodic protection project on the Richland Chambers pipeline for one year. TRWD is also actively pursuing federal grants and low-interest loans from the State Water Implementation Fund for Texas (SWIFT) to further offset capital costs.