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Water utility to have special audit team

Wednesday, July 26, 2006 by

Austin’s Water Utility is a $300 million a year enterprise, and the city is taking steps make sure all 300 million of those dollars are being spent properly. The Council’s Audit and Finance Subcommittee voted Tuesday to recommend that the Council authorize an ongoing audit initiative dedicated to AWU.

City Auditor Stephen Morgan said it’s not unusual for a city department the size of AWU to have an audit team dedicated to its programs, and said there was no single incident that spurred the move. However, there have been some high-profile incidents in recent months that have brought attention to the utility’s programs.

"You can't guarantee prevention but the presence of auditors is proven to deter problems," said Morgan. "If you’ve got a visibility in the department and are continually interacting with the whole management team, it can make a difference. Right now, it’s known that the auditors are external to the utility. It becomes another matter when people are aware that you are there. They’re thinking ‘We've got to make sure we've got our process set up right because we might get audited.’"

The controversial departure of Bill Moriarity from the Austin Clean Water Program last year brought calls from some Council Members and others at the time for tighter controls over the department.

Other factors include the fact that the department is currently spending 39.7 percent of its funds on debt service.

All the Council Members on the committee noted that Austin Energy has had a constant audit unit present for some time now. Council Member Brewster McCracken said AWU’s programs need the same level of scrutiny.

"We are simultaneously in the water utility embarking on a minimum of four projects that each by themselves is very ambitious, very far reaching and very expensive." he said. "It’s a big moment of change at the water utility…all positive and important things to do. With so much going on it is important to have a comparable audit presence in the water utility as at Austin Energy."

Council Member Lee Leffingwell recalled talking with the city's bond advisers about AWU.

"If the water utility is doing really badly, it's going to affect the other enterprise funds," he said. "And they weren't saying they were doing badly; they were just interested in information on that."

Leffingwell said they also noted the high percentage of the AWU budget that goes for debt service. "That doesn't reflect badly on anybody, it's just that we’re in the situation of having to do a lot of capital improvements," he said.

"And we voted to recommend that the Council authorize another full-time employee," which would be converted from an existing temporary employee to assist with hotel audits, he said. That program brought in almost $1.5 million last year, he noted.

Mayor Pro Tem Betty Dunkerley said the Council Committee recommended adding $35,000 to the budget for the city auditor's office for consulting on the water utility. She said that amount would be added to $30,000 which is already in the department's budget for consulting. "That would go toward being able to get the kind of expertise they need" in order to understand how the utility works, she said. The consultant would likely be an engineer or firm with experience or knowledge to assist auditors.

Assistant City Auditor C’Anne Daugherty said there will be a group of auditors dedicated to the AWU. "What we want to do is find a small group of folks to become familiar with our water utility and the water and wastewater industry, in general, in order to effectively monitor the risk that department is facing," she said. "We’ve known for years that we needed to be over there. This is an enormous commitment of resources. We now are finding that risks are compounding, there’s a lot of very public things that are happening that affect both the ratepayers and the taxpayers."

AWU gets 48 percent of its funds from the sale of water, and 44.8 percent from wastewater service, according to city staff. In addition to debt service, AWU spends 7.9 percent of its revenues on collection systems, 7.3 percent on water treatment, 7.2 percent on distribution systems, and 6.6 percent for wastewater treatment. The utility also transfers 7.5 percent to Capital Improvements Projects and 6.1 percent to the city’s General Fund.

AWU’s top five programs, by expenditure, are the Austin Clean Water Program, at $49.2 million; Relocation Projects at $31.2 million; Plant Improvements, at $21.8 million; Wastewater Collection System Improvements, at $19.6 million; and Service Extension Request Reimbursements, at $12.2 million. Those expenditures will increase even more as the utility takes on construction of Water Treatment Plant #4 and an aggressive conservation program.

Anti-tollers dominate corridor meeting

Speakers fail to focus on route of road

Attendees at Central Texas hearings on the Trans-Texas Corridor-35 are universally opposed to the proposed statewide toll road, a point that was reiterated by speaker after speakers at last night’s environmental impact hearing at Taylor High School.

The Texas Department of Transportation is hosting 54 hearings across the state on TTC-35 as part of the preparation of an environmental study. Unfortunately, not many speakers had gotten past the resentment of the creation of a toll road and few focused on what was the intention of the meeting – narrowing the path of the proposed route.

Activist Linda Curtis of Independent Texans pointed out the disconnect between the content of the comments at last night’s meeting – "Toll roads are bad." – and the intended purpose of the meeting – "The toll road should go here, and not here."

Asked for a show of hands, only one person in the audience favored the TTC-35 project. Monday night in Georgetown, only two out of 300 attendees favored the toll project.

The choice whether to pursue or not pursue the toll corridor, however, was a made a year ago, in a series of sparsely attended meetings sponsored by TxDOT that drew little interest from the public at the time, Curtis told the audience of about 200 at Taylor High School. This series of meetings was to talk about the route within the corridor, a point that seemed secondary to most speakers.

Curtis’ solution is simple, what she called a statewide coalition she has dubbed RRR, or Rout Rick’s Route. Curtis, like Sal Costello, is organizing groups across the state to vote pro-toll road candidates out in November. As one speaker noted, "TTC-35 was created with a stroke of a pen and it can be ended with a stroke of a pen, in November."

"There is something different going on, and it’s independent politics, with a small ‘i,’" Curtis told the audience. "We have joined Democrats and Republicans and Independents and Libertarians and ‘none of the abovers,’ and all of us have come together to figure out a way to take this project down. This is a united movement that will follow the lead of One Tough Grandma and pick our places down-ballot, too."

The meeting also served as a rallying point for anti-toll candidates, including Karen Felthauser and Lillian Simmons. Felthauser gave a laundry list of why she opposed the toll roads: the outsourcing of American jobs; the destruction of Blackland Prairies; the creation of an entirely new taxing infrastructure; and the profit made by outside companies. Simmons complained about certain aspects of the contract, such as neglecting existing routes so that it would push traffic onto the toll road.

Chris Hammel of the Blackland Prairie Coalition did raise more specific concerns about the route: the pollution in rural areas where traffic is not a problem; the high consumption of land that would be a threat to both farms and endangered species; the creation of concessions that would take business away from existing businesses along I-35 and the impact of the road on about a quarter of the state’s family farms.

Unfortunately, because the hearing was part of the federally mandated environmental impact study, staff from the TTC-35 project and the Texas Department of Transportation did not respond directly to testimony. Instead, each question will be addressed, in writing, in the updated environmental impact study.

©2006 In Fact News, Inc. All rights reserved.

Backin’ up McCracken . . . Caryl Yontz, a former lobbyist for the employee union AFSCME in Washington, DC, has joined the staff of Council Member Brewster McCracken. Yontz said she retired to Austin but found that she wasn’t completely suited to retirement—at least not full-time. She is working for McCracken on a part-time basis. He is still looking for an aide to take the job of Rich Bailey, now the Mayor’s chief of staff . . . Downtown neighborhood to seek restitution . . . The Downtown Austin Neighborhood Association’s steering committee voted unanimously Tuesday night to accept the resignation of its president, Andrew Clements. The steering committee then elected Marshall Jones to be the new president of DANA. DANA secretary Ted Siff said Clements has been removed from the steering committee and that DANA would be seeking full restitution of the $17,000 in funds burgled from Clements’ house. Clements took the cash home after a late May fundraiser. A few days later, his home was burglarized and the money was reported missing. Downtown Planet reported the story in its July 13 edition, after which Clements removed some of the papers from their distribution points and the newspaper’s publisher filed his own theft report. (See In Fact Daily, July 21 and 25, 2006.) . . . Meetings . . . The Council Subcommittee for Emerging Technology and Telecommunications meets at 3:30pm in Boards and Commissions Room at City Hall . . . The Building and Standards Commission meets at 6:30pm at 505 Barton Springs Road . . . Clean Water seeks new Program Director . . . Texas Clean Water Action's Program Director, David Foster, is stepping down from his current position this fall and the organization is looking for someone to fill his shoes. According to an email from Clean Water Action President David Zwick, Foster may continue in a part-time capacity with CWA. More than a million members strong, CWA is a national organization working for clean, safe, and affordable water; prevention of health threatening pollution, and creation of environmentally safe jobs and businesses. Texas CWA has more than 50,000 members . . . Water IQ . . . A recent survey showed that when consumers know where their water comes from they are more likely to save it. Thus, the LCRA and the City of Austin will jointly launch a new public education campaign, "Water IQ: Know your water," in Central Texas, starting with a news conference today. The campaign will offer simple tips to help people save water in their homes and businesses while also informing them about the source of their water. The news conference will feature some of the region's leading water experts and demonstrations of water-saving tips on the front lawn of an Austin-area family's home. Attending will be : Joe Beal, General Manager, LCRA; Toby Futrell, Austin City Manager; Kathleen White, Chair, Texas Commission on Environmental Quality; Judy Walker, homeowner; and others. The 1:30pm news conference will be held at 12018 Pleasant Panorama View, a private home on Lake Austin . . . Williamson landfill changes . . . Perhaps in anticipations of a Thursday meeting with the TCEQ and Hutto-area stakeholders, Williamson County Commissioners have announced they are renegotiating certain issues in the contract with Waste Management (WMI) on the operation of the county’s landfill. The contract revisions under consideration include increasing the revenue to the county, placing restrictions on the origin and amount of waste accepted at the landfill, and assisting with community projects such as additional recycling services and youth activities. The contract was last amended in 2003. Commissioners have been criticized for giving WMI too much control in that contract. Precinct 1 Commissioner Lisa Birkman along with Precinct 4 Commissioner Frankie Limber and County Attorney Jana Duty are on the committee that is reviewing the contract and will make recommendations on changes to the Commissioners Court.

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