Interoffice Memorandum
DATE: September 23, 2026
TO: Mayor Jerry L. Demings and County Commissioners
THROUGH: N/A
FROM: Marc Cannata, P.E., Director, Utilities
CONTACT: Andres Salcedo, P.E., Deputy Director, Utilities
PHONE: 407-254-9719
DIVISION: Fiscal and Operational Support Division
ACTION REQUESTED:
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Approval and execution of 1) Resolution of the Orange County Board of County Commissioners regarding setting a revised Preliminary Water System Charge Schedule; providing for an Automatic Annual Rate Increase; providing for a Five-Year Rate Plan; providing for Revised Conservation Charges; providing for a High-Intensity Water User Surcharge; providing for Periodic Review; providing for Annual Notice to Customers; providing for Severability; and providing for an effective date. and 2) Resolution of the Orange County Board of County Commissioners regarding setting a revised Preliminary Reclaimed Water Charge Schedule; providing for an Automatic Annual Increase; providing for a High-Intensity Water User Surcharge; providing for an Exemption for Right-of-Way Landscaping; providing for Periodic Review; providing for Annual Notice to Customers; providing for Severability; and providing for an effective date. All Districts. (Fiscal and Operational Support Division)
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PROJECT: N/A
PURPOSE: Orange County Code Chapter 37 - Water and Wastewater, Article I, Orange County Water, Wastewater and Reclaimed Water Service Rules contains regulations pertaining to the provision of central drinking water, reclaimed water, and wastewater service within unincorporated Orange County. Staff is recommending a revision to Chapter 37, Article I, to define high-intensity water users (HIWU) as non-residential users with an exceptionally large non-domestic water demand, and adoption of special high-intensity water user charges, fees, and rates that would apply to those users with total water demand in excess of 100,000 gallons per day.
Orange County has limited potable and reclaimed water supplies. Given we reside within the Central Florida Water Initiative area, the County’s traditional groundwater supply is constrained by the County's consumptive use permits, and meeting significant future demands will increasingly require development of more expensive alternative water supply (AWS) projects.
The County has invested substantial resources and decades of planning and regional collaboration in developing these future water supplies. A very large non-domestic water user can consume a significant amount of capacity that otherwise would be available to accommodate future residential, commercial, and other community domestic water demands.
Reclaimed water is also a valuable part of the County’s long-term water supply portfolio. Although reclaimed water is not drinking water, using large quantities of reclaimed water for a single industrial facility can still affect the County's overall water supply strategy because reclaimed water is an alternative water supply resource that provides aquifer recharge and helps offset demands that otherwise would have to be met from potable supplies or through development of additional AWS capacity.
The ordinance is intended to protect existing potable and reclaimed water capacity and ensure that unusually large water users bear the appropriate costs associated with their demands. Therefore, the ordinance provides for additional capital charges to address the higher capital costs associated with AWS facilities.
In addition to the capital costs, there are significantly higher operating costs to produce potable water at an AWS facility. Therefore, staff proposes adding a HIWU surcharge to the Water System and Reclaimed Water charge schedules. This surcharge addresses the incremental cost of producing water at the Cypress Lake AWS treatment plant that is over and above the cost of producing potable water at the County’s traditional groundwater source facilities. As the Cypress Lake facility is projected to be online by fiscal year 2029-30, the proposed surcharges would not take effect until October 1, 2029.
Chapter 153, Florida Statutes, requires the County to approve most rate changes in two steps. The County must first adopt a resolution setting forth a preliminary charge schedule followed by the adoption of the final charge schedule at a separate public hearing. The attached resolutions include the revised Preliminary Water System Charge Schedule and the revised Preliminary Reclaimed Water Charge Schedule. Both schedules maintain all the normal rates and charges for fiscal year 2026-27 with no other rate changes except the addition of the HIWU surcharge to each schedule. The second step is to hold public hearings for final adoption of these charge schedules, which will all be duly noticed and scheduled for November 10, 2026.
On October 13, staff is requesting only this non-binding approval of the preliminary charge schedules as the first step of their possible adoption after the second step of a public hearing, and at this time no Board action on the proposed HIWU Ordinance will be taken. A public hearing for adoption of the ordinance is scheduled for October 27, 2026.
The County Attorney’s Office has reviewed the resolutions and finds them acceptable as to form. The HIWU surcharge proposed to be added to the revised Water System and Reclaimed Water charge schedules will be presented during the work session on October 13, 2026. Utilities staff recommend approval.
BUDGET: N/A