When it came time to plan their retirement, Carol Dogans and her husband were drawn to Central Texas. The couple was excited about being closer to wide open spaces and enjoying a slower, quieter slice of life. Last fall they put an offer down for a home just outside Kyle, ready to leave Dallas behind.
What they didn't expect was how much they'd be paying for water.
In Dallas, the couple rarely paid more than $100 a month for water. In their new home, they've gotten used to paying more than $220 a month. Last fall, the municipal utility's water rates for customers inside the city limits rose 20%. Many residents living just outside the city, in Kyle's extraterritorial jurisdiction (ETJ), are also served by the city of Kyle's utility. They saw rates rise 77%. Wastewater rates rose 6% and 30%, respectively. Now, some residents both inside and outside the city limits are struggling to keep up with the cost.
'I plan my life around this high water bill'
Dogans and her husband run the taps at half strength. They limit toilet flushes. They shower on a timer, and she doesn't shave her legs as frequently because she doesn't want the water running that long. She carefully plans when and if her grandkids can come visit, taking into account the strain their additional water usage will put on the family's finances.
" I plan my life around this high water bill," Dogans said. "Every time I go to the sink, I'm like, 'oh my god, I have to turn on this water.'"
The Crosswinds neighborhood, where the Doganses live, is about a mile outside the city limits of Kyle. The neighborhood shares a lot of its water infrastructure with Kyle, where customers' average monthly bill is around $140 a month. Crosswinds residents and other households in the ETJ that are reliant on Kyle's water system pay an average of $260 a month.
" My husband and I … we do have regrets that we [came] here due to the water rates," Dogans said. "With our gas, with our electricity, you kinda know what the rates are and you can kind of work on that, you know? But with water, it's such a necessity and even the necessity part of it is outrageous."
'There's no cheap water anymore'
Part of the reason for the rise in water costs is simple: Water in the Hill Country is becoming scarcer. Drought conditions persist throughout the region, and aquifer levels continue to decrease.
Kyle also continues growing. Its population jumped from an estimated 45,697 in 2020 to 65,833 in 2024. The city expects its population to exceed 77,000 people by 2030.
More homes and businesses mean greater demand on Kyle's water supply. The city is working to diversify its water portfolio by securing access to sources like the Carrizo-Wilcox Aquifer, but acquiring new water is costly and requires additional infrastructure.
That water must also be treated after use. Kyle's wastewater system is part of more than $800 million allocated to water-related capital improvement projects in the city's recently approved budget.
Work to expand Kyle's wastewater treatment facility began in 2018. Current improvements will increase the plant's capacity from about 4.5 million to 6 million gallons per day.
The timing is critical.
"The city is very motivated to maintain compliance. Once we go above 4.5, the state deems us non-compliant," said Robert Defreitas, the wastewater facility's chief operator.
The plant was expected to exceed that threshold at the end of 2026. The current phase of expansion is scheduled for completion in November.
Still, the upgrade is only a short-term solution. The long-term goal is to increase capacity to 9 million gallons per day by 2028, with plans to eventually reach 12 million.
The cost of delivering water is rising as well. Securing new water sources is only part of the equation; the city must also invest in storage facilities, pumping stations and pipelines to move it.
"There's no cheap water anymore," said Allison Kelly, the city of Kyle's assistant communications director.
Future rate hikes add to affordability concerns
Kyle residents, particularly those outside of city limits, appear to be facing some of the highest water bills in Hays County. In San Marcos, most household water bills average less than $50 a month.
Some of the reasons that residents have been given for the cost increases have felt vague. The costs attributed to customers outside city limits include more pump stations to maintain pressure over long distances and extending water and wastewater lines to reach properties.
But some residents question whether those costs justify the difference. Dogans, who lives just outside the city, said her neighborhood's proximity to Kyle makes the higher rates hard to understand.
"Fairness means rates that reflect actual service costs, not boundaries," Dogans said.
Some city leaders have also raised questions about how water rates are calculated.
"I wasn't sure it was proven sufficiently that it costs us that much more to supply them with water," said newly elected Kyle City Council Member Courtney Goza. "I'd really like to see exactly how they calculated the out-of-city-limits rates."
The rates were based on recommendations from consulting firm Raftelis, which the city hired to help develop its budget. Details about how ETJ rates were calculated were not provided to Goza.
Raftelis declined to comment for this story.
The city recognizes how heavy the burden of these bills have become for some residents. At the beginning of the month, the Kyle City Council approved a $30,000 utility assistance pilot program. The program will offer qualifying households up to $600 a year to use toward current or past-due utility balances.
Goza said the program may not go far enough.
"With rates as high as they are, especially for customers outside city limits, $30,000 is not going to go very far," Goza said.
Part of Raftelis' recommendations includes annual rate increases over the next five years. Rates for customers inside city limits are recommended to increase again by 20% this fall, with both inside and outside rates rising by another 20% in fall 2027.
The stakes of these rate changes are high for residents.
"Well, I will be moving if that happens," Dogans said. "I barely can afford this rate hike."
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