Living Unit Equivalent (LUE) Charge Notice

April 2, 2025

RE: The Texas Water Company LUE charge update to developers 

Dear Texas Water Company customers and business partners,

This letter is intended as a public notice that Texas Water Company (TWC) is adjusting its Living Unit Equivalent (LUE) charge used to calculate contributions in aid of construction for developers and new non-standard connections across its service area. Please read the following carefully.

TWC is authorized by its tariff to charge developers a prorated share of all costs associated with the impacts of new development upon its system. The new LUE charge is directly related to the costs associated with building our infrastructure across the entire TWC service area, infrastructure that is necessary to keep up with growth and to serve new developments and non-standard service connections. It is also meant to keep TWC’s existing customers from having to subsidize growth. The cost consists of a source, storage, and transmission improvement charge. 

The source improvement charge is the cost of water supply development and water treatment in the region. TWC has a diversified water supply consisting of both surface water from Canyon Lake and ground water from the Trinity Aquifer. The source improvement charge will assist TWC in funding projects associated with further developing its water supply and water treatment systems, such as well rehabilitations, adding treatment to existing wells, acquiring well fields and investing in surface water projects with regional partners. The source improvement charge may likewise be used by TWC to improve capacities at its pump stations. The storage improvement charge addresses the effects of new development on the elevated storage capacity of the TWC system. TWC has completed several elevated storage projects in recent years which have improved the level of redundancy of our system and our ability to cope with peak demands. The TWC standard and requirement for elevated storage is 600 gallons of elevated storage per connection, which provides a full 24 hours of storage for a peak day demand. The transmission improvement charge will assist TWC in funding the cost for upsizing existing transmission mains and building new regional transmission mains to accommodate growth throughout the TWC service area. 

The new LUE charge for the entire TWC service area, effective immediately, will henceforth be set at $18,025.00 per residential connection or single residential unit equivalent (300 gallons per day) for larger meters, whichever is more stringent. This fee has been developed using estimates based on projected necessary regional infrastructure and recent project construction prices for the next five years. 

Please note that the new LUE charge excludes some costs that may present themselves in a proposed development. For example, excluded from the updated LUE charge structure are any costs associated with delivering water at a higher pressure than what already exists in the nearest TWC transmission main. Any need to boost system pressure for a development will be funded at the sole cost of the developer. TWC requires that all lots be served with a minimum of 45 psi at the meter and will not agree to serve lots at higher elevations without first boosting system pressure.  TWC may contribute to oversizing new pump stations, water mains, and storage projects as they fit into TWC regional plans. TWC has also excluded from the updated LUE charge structure any offsite transmission mains that will “dead end” into developments at the fringe ends of our system. If the offsite main does not benefit the TWC system as a whole, the line extension will be funded solely by the developer. The storage improvement charge will fund the construction of regional or upsizing a developer funded elevated storage tank (EST). If a developer requires an EST be built taller than 150 feet due to relocating the EST site or higher system pressure requirements, TWC reserves the right to pass on excess costs to the developer. 

Thank you all for continuing to be valuable partners to TWC and the community.