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Thursday, February 1, 2018 by Jack Craver

Troxclair wants to know how rates compare to other Texas utilities

This year, the average Austinite will spend $2,475 on utility bills to cover the cost of electricity, water and garbage pickup.

City Council Member Ellen Troxclair wants to know how that compares to what other people served by other utilities in Texas pay.

A resolution Troxclair plans to introduce today asks city staff to conduct a study of the prices charged by other private and public utilities throughout the state as well as to develop “affordability standards” for Austin Water and Austin Resource Recovery. The resolution wants answers by Aug. 10.

During a Council work session Tuesday, Troxclair noted that Austin Energy regularly provides Council with data on how its rates compare to other electric utilities and that it has committed to two affordability goals set by Council: that its rates remain in the bottom 50 percent of state rates and that they do not increase more than 2 percent each year.

“We get lots of information from Austin Energy, measuring everything under the sun, and we do not get that same level of oversight for Austin Water,” said Council Member Alison Alter, who is co-sponsoring Troxclair’s resolution, along with Council members Pio Renteria and Ora Houston.

While AE does regularly present data on its rates to Council, AE officials noted during a Council work session just the week before that its lower-than-average rates do not necessarily mean that the average Austinite pays less per month than Texans served by other utilities. AE customers, for instance, pay a monthly $8.95 fee that funds a variety of environmental programs.

Mayor Pro Tem Kathie Tovo said she was concerned that the resolution might send the message to AW and ARR that their primary goal should be to lower costs in the short term, at the expense of environmental goals Council has set for the two agencies relating to water conservation, recycling and composting.

Council has prioritized water conservation, said Tovo, based on the idea that saving water will “reduce our cost down the road because this is a scarce resource.”

While nearly all electric utilities in Texas get their power from the same grid – the Electric Reliability Council of Texas – each water utility deals with significantly different conditions, said Tovo.

“Measuring our water utility rates compared to others could be apples and oranges,” she said.

AW Director Greg Meszaros echoed Tovo’s concerns. Among other variables to consider, he said, is the fact that AW draws from surface water, which is more expensive to treat than groundwater. The terrain served by the utility is another important consideration that can drive up costs, he said.

Meszaros said he’s concerned that Council will look at a comparison of water rates and demand that AW provide lower prices, likely at the expense of services.

Troxclair reiterated that her resolution was not seeking any changes necessarily, but simply information that Council could use to assess whether the rates are appropriate and be able to explain to constituents who are complaining about high water prices why the prices are at their current level.

“Nobody is asking for a reduction in services,” she said.

Assistant City Manager Robert Goode warned that while the city could easily compare ARR’s rates to those of other municipal waste haulers, it would be a challenge to find prices for the many private haulers that serve many of the state’s residents.

“Private haulers have not been historically open to sharing their cost data,” he said.

At one point, Troxclair asked Meszaros if he was supportive of her resolution.

“I don’t know if ‘supportive’ is the right word,” he said, “but we certainly have the capability to provide the analysis that the resolution is requesting.”

Photo by Andy Mabbett (Own work) [CC BY-SA 4.0], via Wikimedia Commons

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Key Players & Topics In This Article

Austin City Council: The Austin City Council is the body with legislative purview over the City of Austin. It offers policy direction, while the office of the City Manager implements administrative actions based on those policies. Until 2012, the body contained seven members, including the city's Mayor, all elected at-large. In 2012, City of Austin residents voted to change that system and now 10 members of the Council are elected based on geographic districts. The Mayor continues to be elected at-large.

Austin Energy: As a municipally-owned electric utility, Austin Energy is a rarity in the largely deregulated State of Texas. It's annual budget clocks in at over $1 billion. The utility's annual direct transfer of a Council-determined percentage of its revenues offers the city a notable revenue stream.

Austin Resource Recovery: Formerly Solid Waste Services. The department in charge of handling solid waste disposal, recycling, and--in what is still a pilot program--curb-side composting for the City of Austin.

Austin Water Utility: AWU is the municipal utility that provides water service for the City of Austin.

Ellen Troxclair: Austin City Council member for District 8

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