Boerne City Council continued its summer budget workshop series at the July 22 meeting, hearing an update from staff on the Fiscal Year 2026 budget for Boerne Utilities and its Capital Improvement Plan (CIP).
Finance Director Sarah Buckelew led Tuesday’s presentation and began with an overview of the Boerne Utilities budget outlook for Fiscal Year 2026 (FY 2026), which runs from Oct. 1, 2025 – September 30, 2026.
Watch the full presentation online here.
Staff also presented an update to the City’s Governmental CIP, which includes non-utility projects. Read a recap of the Governmental CIP presentation.
What is the CIP?
The Capital Improvement Plan is a long-term planning tool that outlines the City’s strategy for funding and completing major infrastructure projects, which often takes years of future planning and occurs over multiple annual budgets.
The council must also consider City staff’s capacity to advance these projects and whether to utilize outside resources or firms. Changes in economic conditions like inflation also impact the CIP evaluation each year.
Funding Sources
The City of Boerne prioritizes funding CIP projects through capital reserves. This is money that is left over after each fiscal year and set aside for these major infrastructure projects. Additional funding may be provided through developer contributions, bond programs, grants, and other governmental partnerships.
Boerne Utilities CIP projects are funded by revenue generated by the utilities themselves and do not utilize governmental funds. Boerne Utilities projects may also utilize impact fees and developer contributions for funding sources.
Funding for routine infrastructure maintenance is included in other areas of the budget.
Water, Reclaimed Water, and Sewer Budget Highlights
For FY 2026, Boerne Utilities is proposing $19.7 million in CIP projects for its water, reclaimed water, and sewer utilities infrastructure. These projects will be funded by:
- Capital Reserves: $3.9 million
- Impact Fees: $15 million
- Developer Funds: $650,000
Some of the major proposed projects for the water utility include $2 million toward the expansion of the Water Treatment Plant at Boerne City Lake and $490,000 for the installation of a carbon filter at the plant to minimize naturally occurring environmental influences on treated surface water.
Proposed projects for the sewer utility include nearly $1.6 million toward the expansion of the wastewater treatment capacity at the Wastewater Treatment and Recycling Center (WWTRC) located on Old San Antonio Road.
Finally, the reclaimed water utility is proposed to have $5.4 million in projects for the upcoming budget, including the installation of a new reclaimed water storage tank at WWTRC.
Water Rate Study & Increases
The City of Boerne adopted rate increases for water, reclaimed water, and sewer utilities at the end of 2024 based on a recommendations from a comprehensive rate study by an independent third party. The study called for annual increases over five years to fund necessary infrastructure projects.
The rate increases, which were implemented at the start of 2025, are included in the FY 2026 budget, as well. Rates for these utilities will be increased starting Jan. 1, 2026, in order to continue funding for these projects.
Read a full breakdown of the rate increases.
Learn more about Water, Reclaimed Water, and Sewer Service
The City of Boerne utilizes three potable water sources: Boerne City Lake, groundwater wells (9 active, 2 reserve), and purchased treated water from Canyon Lake through the Guadalupe-Blanco River Authority (GBRA). Boerne Utilities delivers that water to 8,692 active water services.
Boerne Utilities also provides reclaimed water service to 1,379 active reclaimed services, which is used primarily for landscape irrigation purposes and saves millions of gallons of potable drinking water each year. The reclaimed water system currently serves customers in the Esperanza and Ranches at Creekside developments.
Boerne Utilities also provides wastewater treatment to 7,801 active sewer services.
Natural Gas Budget Highlights
For FY 2026, Boerne Utilities is proposing $1.4 million in CIP projects for its natural gas infrastructure. These projects will be funded entirely by capital reserves.
Proposed projects for the natural gas utility include $500,000 toward a gas main loop around the perimeter of the Ranches at Creekside development to back-feed smaller mains in the interior of the development during times of increased demand. It also includes $250,000 for the continued construction of natural gas mains in the Regent Park development as part of the infrastructure agreement.
Gas Rate Study Underway
Boerne Utilities is currently conducting a rate study for its natural gas service with an independent third party. The results of that study and any proposed rate changes will be presented to and approved by City Council. Any rate increases would be effective Jan. 1, 2026.
Learn more about Natural Gas Service
Boerne Utilities provides natural gas service to 4,633 active gas services from two substations on the south end of the city.
Stormwater Budget Highlights
For FY 2026, Boerne Utilities is proposing $2.7 million of capital reserves toward one CIP project for its stormwater infrastructure.
The project is the installation of two new culverts along Adler Road – one at Currey Creek and one at No Name Creek – which will raise the two crossings out of the 100-year floodplain.
READ MORE: City holds groundbreaking ceremony for Adler Road improvements
Stormwater Rate Study Coming in 2026
The City of Boerne plans to conduct a rate study on the stormwater utility in the first quarter of 2026 with an independent third party.
Learn more about the Stormwater Utility
The City of Boerne Stormwater Drainage Utility is responsible for drainage services as well as the installation, operation, and maintenance of drainage infrastructure throughout Boerne. It was created by the City Council in response to increasing needs for addressing drainage issues as well as the increased costs of maintenance and construction of projects.
Electric Budget Highlights
There are no proposed CIP projects for the electric utility in the FY 2026 budget.
Electric Rate Study Underway
Boerne Utilities is currently conducting a rate study for its electric service with an independent third party. The results of that study and any proposed rate changes will be presented to and approved by City Council. Any rate increases would be effective Jan. 1, 2026.
Learn more about Electric Service
Boerne Utilities electricity is purchased from BP Energy and delivered by the Lower Colorado River Authority (LRCA). Boerne Utilities distributes that power to 6,586 active electric services from two substations in town.
Upcoming Budget Calendar
The City Council will review and approve the budget for the upcoming fiscal year, which runs Oct. 1, 2025 – Sept. 30, 2026.
Below are key dates in the budget approval process:
- Aug. 8, 2025: City Manager files proposed budget with City Secretary, draft budget provided to City Council
- Aug. 12, 2025: Regular City Council Meeting | Governmental Budget Workshop
- Aug. 26, 2025: First Public Hearing on Budget and Tax Rate
- Sept. 9, 2025: Second Public Hearing on Budget and Tax Rate, Adoption of Budget and Tax Rate
WATCH: Live and Recorded Meetings
