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Water rate increase planned for next year, panel told
Monday, June 1, 2009 by Jacob Cottingham
Austin Water Utility customers will have to dig a little deeper into their wallets for water next year. Members of the city’s Water and Wastewater Commission heard from the AWU finance team last week, who briefed the members on a forthcoming rate hike, the future of the utility’s rate structure and the effects of conservation efforts.
“Typically in July, it doesn’t evoke a lot of response from folks,” he said, noting that it’s “something the city manager chose not to highlight in the forecast.” The utility will be before the commissioners again in July when they are to lock down the final budget and any cuts that may be needed as a result of the water rate restructuring.
Commissioners also wanted to follow up with the utility on the results of recent conservation measures. AWU Budget and Finance Manager Rusty Cobern presented a chart that showed water usage patterns for the past summer. The graph depicted water consumption growing until there was a rainfall event. “Did conservation significantly reduce water usage or was it the rainfall?” Cobern asked rhetorically, adding “The jury’s still out.”
Despite that, Anders said, “We definitely know the conservation efforts we put into place last summer, with mandatory restrictions, provide conservation for the utility.” He said it was more difficult to determine the level of that effectiveness. Cobern told commissioners the utility, “lowered usage assumptions by about 2 percent based on what we’ve seen last year and we will reevaluate.” Still, he cautioned the limits of extrapolating conservation data at such an early stage. “One year does not make a pattern,” he said.
The effects of conservation affect the budget due to the related risk. Cobern told commissioners the more risk the utility assumes – for example in estimating water conservation, the more reserves are needed. Although they have projected a 2 percent water savings, extra funds will have to be set aside in case that projection is inaccurate.
Commissioner Cheryl Scott-Ryan was curious whether the economy was precipitating a change in water conservation, especially amongst the larger water users.
Commissioners also learned that AWU gives residential customers a 10 percent subsidy under the current tiered system. That subsidy has existed since 1999, and before then it was even larger.
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