Sunset Valley Utilities
The City of Sunset Valley offers water and wastewater services to all commercial entities and residences within Sunset Valley.  The City of Sunset Valley is a purchase water system, meaning that water is purchased from the City of Austin and distributed to Sunset Valley customers.  Wastewater is collected and transported through the sewer system where it is treated by the City of Austin.  However, the City owns and maintains all of the infrastructure for the distribution and collection of water and wastewater.  The City also provides residential solid waste services through a contract with Texas Disposal Systems.  Additionally, the City of Sunset Valley manages a stormwater system and all streets within the City.  To learn more about each of these services please visit the following pages.  

Water             Wastewater            Solid Waste                   Stormwater               Streets

On this page you will find information regarding water, wastewater, and solid waste utility rates including utility rate changes for FY 2025. 

New Utility Rates for FY 2024-2025
Since 2023, the Mayor and City Council have been discussing a plan to begin incremental rate increases over the next ten years to bring revenues closer to operational and contractual expenses. This would include increases in the base rate (cost to deliver the service) and volumetric rate (cost of each gallon of water).  However, each year the increase would be considered as part of the budgeting process, as City Council adopts utility rates on an annual basis. 

In FY 2025, which began October 1, 2024 and ends September 30, 2025, the following recommendations have been implemented for residential customers:

• Create a meter-based rate structure as recommended by the Texas PUC and TRWA
• Create a five-tier water volumentric rate system 
• Eliminating the no charge for under 3,000 gallons water usage
• Increasing the monthly base water rate from $9.14 to $11.06 for most residential customers
• Increasing the monthly base wastewater rate from $4.00 to $7.00
• Increase wastewater volumetric rates by $1.00
• Increasing the monthly charge for solid waste from $9.13 to $12.73
• Create a Community Assistance Program to assist low or fixed income residents

Below is a chart showing the new monthly rates for residential customers:

Current Monthly Rates

How will this affect my utility bill each month?
The answer to this question depends on several factors. First, the volumetric rate is based on how much water is used each month. Second, the wastewater volumetric rate is based on the winter averaging.  However,  the average water use for a residential customer is close to 9,500 gallons per month for water and if we were to assume 6,500 for wastewater the following is a prediction of what the total monthly increase would look like for this type of consumption.

 The wastewater average and monthly water use will ultimately determine the monthly increase to the water bill. Customers who use less water will see less increase in their utility bill. Customers who use more water and are in the higher volumetric rate tier will have larger increases.  It is also important to remember to conserve water and turn off irrigation systems in the winter to keep the wastewater average low. The wastewater average determines your wastewater volumetric rate for the entire year.  For example, if a family lowers their winter water use to only 4,000 gallons their wastewater volumetric rate would only be $4.00 monthly for the entire year. 

What if I cannot afford to pay more for these services?
The City recognizes that the increases to utility rates may have a negative financial impact, especially for those on limited or fixed incomes.  As part of the adopted rate increases, the City has established a Customer Assistance Program (CAP) to help those individuals who may need assistance with their utility bills. Click here to learn more about this program and to see if you qualify. 

Historical Utility Rates
Prior to 2015, the City had been making incremental increases in water base rates.  In FY 2015, the City reduced the water base rate to create a wastewater base rate and solid waste fee. Since 2015, the City has not made any changes to the water and wastewater rates that are charged to residential customers.

Utility Operational Subsidy
The City of Sunset Valley receives nearly 75% of its external revenue from sales tax. The bulk of sales taxes flow into the City’s General Fund, which operates as the City’s primary revenue fund, paying for a majority of the City’s operational expenses. In municipal finance, Utilities, such as water and solid waste, are called Enterprise Funds, and for most cities in the nation are usually self-funding. In Sunset Valley, three of the four departments in the Utility Fund bring in less revenue than expenses to operate those departments. To balance the budget, the City of Sunset Valley must transfer money from the General Fund to the Utility Fund. This is commonly referred to as the Utility Operational Subsidy. A subsidy is generally money used by a governmental body to assist an industry to keep the cost of a commodity or service low. The City of Sunset Valley is providing funds from sales tax to the utility fund because the rates and revenue received do not cover the cost to provide these services.

For example, each month the City of Sunset Valley is charged $30.39 by our service provider for each residential home for solid waste services. The fee charged to Sunset Valley customers is $9.13. This means that each month the City subsidizes the cost of solid waste service by $21.26, or nearly 70 percent. The cost to deliver water and wastewater services is also subsidized.

It is important to know that the water and wastewater subsidy does not apply equally to all customer groups or even within a class of customers. For example, commercial customers pay rates that cover the cost of the provided service for water and nearly all for wastewater. Commercial accounts also have private arrangements for solid waste services. For residential customers, water usage determines the benefit received. The average monthly water use within the City for a residential household is 9,633 gallons per month per household. This is also the most highly subsidized user group within the City at over $97 per month subsidized in costs for water and wastewater services.

For more information visit the Utility Rate & Long-term Infrastructure Report

Why is the City looking at this now?

Since 2014, the City has not increased water and wastewater rates.   However, operational costs have increased and the cost to purchase water from the City of Austin fluctuates each year.  It is also anticipated that the City of Austin will increase wholesale water rates soon.  In addition, the City has not been sustainably investing in funding for future maintenance and upgrades to the utility system.  This is one of the reasons that the City Council has undertaken the challenge to work toward a more balanced utility rate system.

Another reason for implementing change is that the current system is based on commercial and residential customer classes.  Staff has reached out to the Texas Rural Water Association (TRWA) and the Public Utility Commission regarding the utility system.  Both entities recommend rates based on meter size and not making distinctions between user groups based on residential or commercial use.  This is a structure that creates fairness and equity among users.  Larger meters are more expensive and usually have greater demand.  Residential meters tend to be smaller and have lower volume demands. Since this system is based on a defined feature of the service it is a better standard for the rate structures.

Finally, solid waste, water and wastewater are essential services that must be secured regardless of fluctuations in sales tax revenue. The goal is to create a rate system that is equitable to all customers, provides revenue to cover the cost of service, and allows the City to invest in the long-term sustainability of its utility infrastructure.