Texas Law Directs State Funds to Waco Road and Utility Upgrades

The Texas Legislature passed the Infrastructure Enhancement Act during the 2025 regular session. The measure expands state matching grants for local transportation and utility projects, with funds available to cities including Waco starting in the 2027 fiscal year.

State budget documents show the act sets aside 2.8 billion dollars statewide over two years. Distribution follows a formula based on population and prior project backlogs, which places McLennan County in line for a portion of the total.

Construction Employment and Local Contracts

Waco residents employed in road and water line work stand to see shifts in available contracts. The act requires that 35 percent of each funded project go to subcontractors located within the county where the work occurs. City procurement records from 2024 list 47 active utility contracts, many of which could qualify for the new matching dollars once applications open in September.

Local advocates note that crews maintaining segments of Interstate 35 through downtown Waco have operated with equipment purchased under the prior five-year capital plan. Additional state funds could extend those crews through 2028 rather than ending projects in 2026.

Utility Services and Household Costs

Water and sewer line replacements in east Waco neighborhoods receive priority under the act's scoring system. The legislation states that projects reducing leakage rates by at least 12 percent qualify for an extra 10 percent match. City utility reports from March 2025 recorded an average daily loss of 2.1 million gallons across the system.

Implementation begins after the Texas Department of Transportation publishes final grant guidelines on 15 August 2026. City staff in Waco have scheduled public meetings for 22 July to review draft project lists before submission.