Spigot in front of pressure regulator??

[mcintoshmc]

I finally finished my repipe. It took 3 1/2 days, and I moved the water heater outside. Everything turned out fine, except for the water pressure when the backyard spigot is turned on. Prior to the repipe I couldn't shower and water grass at the same time because the spigot was tied into the same line with the potable water.

My setup in front of the house consists of 2 cold water lines coming in. 1 comes in 3/4 going straight back the spigot, and the other goes through the regulator and feeds the house.

After I finished up, I hooked up a gauge and I have it set to 80 psi, but when I turn on the backyard spigot, it drops to 40 psi.

Why is this happening?

 

[mcintoshmc]

I've included a photo

 

[mcintoshmc]

FYI, pressure is 120 psi coming from the street without a pressure regulator.

 

[mcintoshmc]

Any ideas??

 

[IFIXH20]

Any ideas??

That appear to be a gate valve in the pic, If the gate valve is old I would start with replacing it due to the fact the gate stem may be broken and the gate has drop abit causing a flow restrict. If the service entrance valve is new I would move the Hose bibb tee further up the water service.