Texas sent $223 million to rural communities to fix water infrastructure after 2023 election

Jayme Lozano Carver, The Texas Tribune

LUBBOCK — Two years ago, Texas voters overwhelmingly approved the creation of the Texas Water Fund with an initial $1 billion allotment to help the state get its water systems back on track. Since then, the state’s leading water agency has allocated nearly a quarter of that money to rural towns, according to state data reviewed by The Texas Tribune.

More than 40 projects totaling nearly $223 million have been approved for fixing water storage tanks and water service lines, building new water wells, and improving drinking water systems, state data shows. That money, paired with money allocated for projects that prioritize creating new water supply through water conservation and water loss mitigation, a statewide public awareness program and more, means more than $735 million has been committed by the Texas Water Development Board.

The data, which the Tribune requested, comes on the eve of another election in which Texas lawmakers are asking voters to spend $20 billion in sales tax revenue over the next two decades to secure the state’s water supply.

Texas’ water supply has long been under duress. Critical infrastructure has aged beyond repair, causing it to fail. More people are moving to the Lone Star State every day, which has spurred water demand, especially in areas that are already running dry. And climate instability is compounding matters.

Proposition 4, the ballot question that would authorize spending $20 billion, is one of 17 constitutional amendments on this fall’s ballot. Election Day is Tuesday. If it passes, at least 50% of the funds, and possibly more, would be used for creating new water supplies that expand the state’s water portfolio, including projects involving desalination, water conservation, reuse, and aquifer storage. The other portion of the money would be used for water infrastructure needs. And there would be stronger legislative oversight by creating a committee to review how the board administers the fund.

Supporters of the proposition — including Gov. Greg Abbott, state lawmakers, and water advocacy groups — have argued the state needs the money to continue the work started in 2023. At the time, nearly 80% of voters approved what seemed like a good start to address the growing water needs that plagued every region of the state.

While the Texas Water Development Board is in the final stages of spending the first billion, some of those same supporters are calling for better tracking and transparency of how funds are being spent to ensure lawmakers and taxpayers are willing to make more money available in the future.

“There’s going to be an option for a future Legislature to continue it or renew it,” said Jeremy Mazur, director of infrastructure and natural resources policy at Texas 2036. “But in order for that to happen, there needs to be clear evidence that this funding stream has worked.”

Progress from the 2023 effort offers a look into the future if the $20 billion initiative is approved. In rural Texas specifically, the money has thrown a lifeline to communities struggling with inflation, supply chain issues and construction costs that make it impossible to make repairs on their own.

“This is not economically feasible otherwise,” said Mary Alice Boehm-McKaughan, general counsel with the Texas Rural Water Association. “These systems literally cannot afford to upgrade their system without access to these funds.”

The $1 billion tranche was more of a band-aid than a panacea, water experts said. At best, it helped clear a backlog of needs that had built up in recent years.

“That $1 billion injection was, in some ways, like if somebody has a wound and it’s bleeding and you have to put a temporary stop on it,” said Sarah Schlessinger, CEO of the Texas Water Foundation. “All the programs are so oversubscribed that it’s not like that was new money for new fun projects.”

Data obtained by the Tribune from the water board through a public records request shows the state has or will fund more than 40 projects. Most of those projects are in rural areas with fewer than 10,000 residents. Only six entities that serve a population between 10,001 and 150,000 residents were awarded grant dollars.

According to the data, these projects range from rehabbing water storage tanks and generators in the small town of Alba, in East Texas, and water service line and meter replacements in Benjamin, 130 miles east of Lubbock. The projects also include a new water well in Corrigan and Weimar, two towns with populations under 3,300 people, and drinking water system improvements in several towns, including Jefferson in far East Texas. Dozens of municipalities, including Matador and Paducah, two towns in the High Plains that both have less than 1,000 residents, were approved for water supply and distribution system improvements.

“Rural communities need this investment in critical infrastructure,” said Kelty Garbee, executive director of Texas Rural Funders, a nonprofit that has championed the 2023 and 2025 constitutional amendments. “Every dollar spent on water will deliver powerful results — repairing old systems, reducing waste, and keeping water affordable for Texas families and businesses.”

Clearer accounting wanted

There’s rarely simple accounting in government. The $1 billion that voters approved in 2023 is no exception.

The water board received the money on Jan. 1, 2024, then took several months to plot a path with public input on how the money should be spent. In the summer of 2024, they put together a list of what programs they would like to make commitments to.

Ultimately, the money was divided among other accounts the water board manages, such as the Rural Water Assistance Fund, Water Loan Assistance Fund, and the State Water Implementation Fund for Texas.

The board later solicited project applications from waste and wastewater systems in Texas. According to the water board, it ended up receiving 68 applications that were focused on water conservation and water loss mitigation. Of those forms, 46 received funding, all of which went toward water infrastructure needs.

About $45 million was allocated for entities with populations of 1,000 or less to receive 100% grant funding from the rural assistance fund. According to Boehm-McKaughan, the East Medina County Special Utility District was able to fix leaks in more than a mile of water line thanks to that grant money.

“The good news here is that the board is prudently and rationally executing its due diligence,” Mazur said. “And doing what it needs to do to get money out the door in an appropriate manner.”

The board does not have a clear indication on how funds have been spent so far on their website, or for what projects. This spurred lawmakers to call for more transparency and oversight to the state’s water fund during this year’s legislative session.

Perry Fowler, executive director of the Texas Water Infrastructure Network, said the water board is under a lot of pressure to get the money out, but it also must vet projects to ensure tax dollars are used correctly.

“There probably are ways they could help demonstrate how money is being spent and when and where a little better,” Fowler said. “But I don’t think they’re being irresponsible.”

Senate Bill 7, which spells out in part how the $20 billion for water is to be spent, will add more oversight and require the water board to report on how the state is providing financial assistance and the progress being made toward addressing water infrastructure challenges.

Mazur said that moving forward, it would be helpful to have a clear description of the benefits to the communities when projects are completed.

“I think it’s going to be important for the board to start telling a story with these projects when they’re completed and what the actual tangible benefit will be to the communities they serve,” Mazur said.

Fowler agreed that more transparency is important. However, he said the public should be more concerned about the volume of projects the board is able to approve.

“As great as this billion is, and if we’re going to get it every year, it’s never going to be enough,” Fowler said. “We’re probably going to have to have additional appropriations because what we’re seeing is we’re not able to meet the demand we have.”

A Texas 2036 report estimates the state needs nearly $154 billion by 2050 for water infrastructure — an estimate that does not include money for projects that create new water supply.

By the water board’s own estimates in the state’s 2022 water plan, towns and cities could be on a path toward a severe shortage of water by 2030. This would happen if there are recurring, record-breaking drought conditions across the state, and if water entities and state leaders fail to put in place key strategies to secure water supplies.

“I don’t think we’re going to end up with a scenario where there’s just money sitting around not being used,” Schlessinger said. “My gut says that $1 billion doesn’t get anywhere close to meeting the amount of project funding needs there are.”

Disclosure: Texas 2036, Texas Rural Water Association and Texas Water Foundation have been financial supporters of The Texas Tribune, a nonprofit, nonpartisan news organization that is funded in part by donations from members, foundations and corporate sponsors. Financial supporters play no role in the Tribune’s journalism. Find a complete list of them here.

This article first appeared on The Texas Tribune.