Rainwater collection rebates and rules in Austin

How much water a roof collects

The Texas Water Development Board’s rainwater FAQ says a system can collect about 0.62 gallons per square foot of roof for each inch of rain in theory. The same FAQ says most installers use an efficiency of about 75 to 85 percent when estimating what a system will collect. In its Austin example, a 2,000 square foot roof receiving 32 inches of rain a year collects about 34,000 gallons a year at 85 percent efficiency.

Austin Water’s rainwater rebate

As of October 2026, Austin Water’s rebate list includes a rainwater harvesting rebate for rain barrel or cistern systems, up to $5,000 based on storage capacity. It’s open to Austin Water customers and customers of some neighboring providers, including the cities of Rollingwood, Sunset Valley, and West Lake Hills, and the Wells Branch and Shady Hollow MUDs (municipal utility districts).

Austin Water pays $0.50 per gallon of eligible capacity for systems without a pump and $1.00 per gallon for systems with a pump, up to $5,000 lifetime per service address, as listed on its online Conservation Hub. Eligible costs include tanks, tank pads, screens, filters, first-flush systems, selected piping, and labor. Gutters, irrigation systems, taxes, shipping, and delivery aren’t eligible costs.

For systems over 500 gallons, Austin Water requires a pre-approval application before you buy or install anything, plus a first-flush diverter and a level base of gravel, sand, or concrete. For systems of 500 gallons or less, you buy and install the system first, then apply within 90 days of completion and 365 days of purchase. Systems of 500 gallons or less must stay in service at least 5 years, and larger systems at least 10 years.

The drainage charge discount

The City of Austin’s Stormwater Management Discount lowers the drainage charge for homes and businesses that collect rainwater. A system can offset up to 50 percent of impervious cover. In the city’s examples, a 55-gallon tank saves $0.20 to $0.30 a month, and a 1,000-gallon tank saves $2.90 to $4.90 a month.

Texas sales tax exemption

Texas Tax Code section 151.355 exempts rainwater harvesting equipment and supplies from state sales and use tax. The Texas Water Development Board says you claim the exemption by giving the supplier Tax Exemption Application Form 01-339.

HOAs and rain barrels

Texas Property Code section 202.007 says a property owners’ association may not prohibit or restrict an owner from installing rain barrels or a rainwater harvesting system, and a provision that does is void. The statute still lets an HOA bar a barrel on HOA or common property, between the front of the home and the street, or in a color that doesn’t match the home. It also lets an HOA regulate the size, type, shielding, and materials of barrels visible from a street, another lot, or a common area.

Permits for tanks

Austin Development Services lists a water tank on grade of up to 5,000 gallons as exempt from a building permit if it’s no more than twice as tall as it is wide and sits outside a flood hazard area. Exempt work still has to meet the building codes and city codes.

What a full system costs

The Texas Water Development Board’s rainwater FAQ says a complete rainwater harvesting system for a typical single-family home generally costs $8,000 to $10,000. The same FAQ says the storage tank is the single largest cost, from about $0.50 per gallon for a fiberglass tank to more than $4 for a welded steel tank.

What we do

We connect downspouts to rain barrels and tanks, handling the diverter and the run from the downspout to the tank as part of our downspouts and drainage work. We don’t sell or install the tanks themselves. Austin Water’s rebate doesn’t cover gutters.