The City Council on Tuesday, Oct. 27, is set to authorize the largest piece yet of a low-interest state loan that Denton is using to expand the Ray Roberts Water Treatment Plant.
An ordinance on the council's agenda would issue $57,240,000 in utility system revenue bonds to the Texas Water Development Board. The money comes from the State Water Implementation Fund for Texas, known as SWIFT, a program that lends at below-market rates for projects in the state water plan.
Terms and timing
According to the agenda information sheet from Water Utilities and the Finance Department, the bonds carry an overall borrowing cost of 4.29% over 30 years. Staff estimate the arrangement saves the city about $12.2 million compared with issuing certificates of obligation in the public market.
A staff presentation says the state board sold the bonds that fund the city's loan on Sept. 25, funding is scheduled to close Dec. 3 and the first payments on this installment are due in June 2027. Debt service is included in the 2026-27 budget, the presentation says.
A five-year draw
The state approved Denton's application for $195,845,000 in June 2024, and the city chose to borrow it in yearly pieces to match the project's spending. The first two installments, $10,135,000 and $11,235,000, have already been issued. After this year's $57.24 million, the schedule calls for $87,690,000 in 2027-28 and $29,545,000 in 2028-29.
The plant
Ray Roberts went into service in 2002 and treats up to 20 million gallons a day. The expansion would add another 20 million gallons a day with a parallel membrane treatment train and leave room for 30 million more, according to the presentation, which cites growth projections calling for about 110 million gallons a day of capacity at build-out by 2053.
