Our Water Contract - FAQs
When was the North Texas Municipal Water District established?
In 1954, the North Texas Municipal Water District created a regional water system with 10 original member cities. Today, there are 13 member cities in the NTMWD.
Who are the Water District’s Member Cities?
Allen, Farmersville, Forney, Frisco, Garland, McKinney, Mesquite, Plano, Princeton, Richardson, Rockwall, Royse City and Wylie.
What is the difference between Member Cities and Customer Cities?
NTMWD Member Cities are the only guarantors for the District’s debt and are responsible for a proportional share of the debt issued while they are a member. Member Cities also appoint representatives to the Water District Board of Directors.
How has the District changed over time?
When the NTMWD regional water system was established, cities had smaller populations and water conservation measures were not adopted. In 1988, the individual contracts for the eleven member cities were consolidated into one agreement, but the key provisions remained the same as they were from 1954. Any changes to the NTMWD rate methodology require the unanimous consensus of the 13 member cities and the Water District’s Board of Directors.
When was our water contract last signed?
On October 29, 2020, all 13 cities and the District signed a new water contract agreement. Under the new unified agreement, member cities are transitioning away from “take or pay.” Instead of highest annual usage, rates will move over time to a 5-year rolling average. The new agreement will create a system that incentivizes conservation and provides significant long term or “generational” savings for member cities who conserve while ensuring the long-term financial health of the water district.
How will changes in the new contract be implemented?
During the first eight years (through 2028) of the new methodology, the changes will be incremental and minimal. Each member city’s annual minimum (our contractual funding commitment) will gradually be adjusted to align its portion of overall costs with its historical actual consumption. Agreed to through contract negotiations, this allows time for growing cities in the District to adopt pricing, conservation and efficiency strategies.
Beginning in 2029, the allocation method will transition to a combination of the newly established annual minimums and actual water used. Then starting in 2033, the annual minimum for each city will be based on a five-year rolling average of actual consumption.
What should we expect with how our water rates are calculated?
There will be little change in how our rates are calculated through 2028. Beginning in 2029, the allocation method will transition to a combination of newly established annual minimums and actual water used by Plano. Starting in 2033, Plano’s annual minimum will be based on a five-year rolling average of our actual consumption. As they are now, your personal water rates charges are based on your actual usage and are a pass-through of rates charged by the District.
How were the City of Plano’s water rates previously calculated?
The former rate methodology for NTMWD member cities was based on a “take or pay” system. Cities paid for water based on the year of their greatest annual usage and this level could not be reduced based on subsequent water use patterns.