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2025-050 Old Alton Water System Update May 16,2025 Report No. 2025-050 INFORMAL STAFF REPORT TO MAYOR AND CITY COUNCIL SUBJECT: Status of Old Alton water system and potential grant funding. EXECUTIVE SUMMARY: On November 19, 2024, City Council directed Water Utilities to apply for Texas Water Development Board (TWDB) grant funding to assist the Old Alton neighborhood in switching from a failing groundwater supply system to City of Denton water. BACKGROUND: Old Alton Drive has 21 homes, 19 of which are located outside of city limits in Extraterritorial Jurisdiction(ETJ) 1. These homes were supplied by an independent groundwater well maintained by a groundwater operator hired by the Homeowners Association (HOA). Most properties have individual septic systems. The water well failed on May 6, 2023, and the City of Denton Water Utilities Department worked with the community and the Texas Commission on Environmental Quality(TCEQ)to install an emergency interconnect to the City water service. The City of Denton has been working with the community to explore and develop viable permanent solutions for the water supply issue since the temporary connection was installed. On November 19, 2024, City Council directed Water Utilities to apply for Texas Water Development Board (TWDB) grant funding to assist the Old Alton neighborhood in switching from a failing groundwater supply system to City of Denton water. The grant selection was coordinated with the Old Alton Community, Denton County, The Water Finance Exchange and the TWDB. The Emerging Contaminants in Small or Disadvantaged Communities Grant Program (EC) funded through the United States Environmental Protection Agency (EPA) was identified as the best option to serve the Old Alton Community as it could cover up to 100% of the cost of the water connection project, and the Old Alton wells have a history of contamination documented through TCEQ inspections. The Project Information Form (PIF)was submitted on April 4, 2025 and receipt was acknowledged by the TWDB. The community also partnered with Denton County in an attempt to establish a Public Improvement District (PID) to finance any portion of the improvements that are not covered by the grant funding. Denton County has pledged support in the City of Denton's efforts to secure as much grant funding as possible through the TWDB and any other available means. DISCUSSION: On May 13, 2025, the TWDB released the Intended Use Plan for the EC Grant which listed the Old Alton project as ineligible. The City of Denton is working to schedule a meeting with the TWDB to analyze the reasoning for the preliminary decision and make adjustments to the application. May 16,2025 Report No. 2025-050 The City will also engage the TWDB through both Denton's and Denton County's lobbyists to emphasize the importance of this project to the health and safety of the Old Alton community. The City will also work to pursue alternative grant opportunities such as the Drinking Water State Revolving Fund and United States Department of Agriculture (USDA) grants. CONCLUSION: The City of Denton will work with Denton County to petition the TWDB to approve the project grant in full in an effort to avoid establishing a PID to cover the community's share of the cost. Staff will continue to update City Council via Informal Staff Reports. STAFF CONTACT: Kyle Pedigo Planning and Engineering Division Manager Kyle.Pedigo@cityofdenton.com (940) 349-8072 REQUESTOR: Staff initiated STAFF TIME TO COMPLETE REPORT: 2 hours PARTICIPATING DEPARTMENTS: Water Utilities