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Jo Clifton is the Politics Editor for the Austin Monitor.
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Thursday, May 14, 2020 by Jo Clifton
With businesses shut, Austin Water’s revenues fall
Austin Water, which contributed an extra $5 million to the city’s utility customer assistance program and cut rates by 10 percent in an effort to help those affected by the coronavirus, has itself felt the impact of business closures on its bottom line.
David Anders, assistant director for finance and business services, told the Austin Water Oversight Committee during an online meeting Wednesday that the utility, which had originally planned to go back to its original rates on Oct. 1, had decided to keep the reduced rates through Oct. 31. That’s the date when new rates generally go into effect.
Anders also told the committee that water demand was about 5.5 percent lower than expectations in April. That, coupled with the lower rates, meant that “water revenues were about $2.1 million below budgeted levels.” In addition, wastewater usage was about $2.4 million below expectations, he said. That led to a combined shortfall of about $4.5 million just for the month of April.
Not surprisingly, Anders said at least half of the revenue loss in April was due to the fact that so many commercial customers stopped using their normal amounts of water due to the Covid-19 shutdown. “We will closely monitor all the revenues and compare those to the budget levels and make sure we can respond to any more severe revenue losses,” he told the committee.
But there was good news, too: The water utility got higher than expected revenues during the first half of the fiscal year that started in October. That was partly because that month was particularly dry, Anders said. So the utility earned about $9.5 million more than what was budgeted through March, he said.
Anders also told the committee that the utility has spent about $1 million on Covid-19 related expenses. For example, the utility is spending about $150,000 a month on temperature monitoring for all its employees working at water and wastewater facilities. Some of the coronavirus-related costs would have been incurred anyway, like personnel expenditures, he said. He later told the Austin Monitor via email, “For example, if an assistant director was working in our … Department Operations Center on Covid-19 matters we count this as a Covid-19 expense. We would have paid this AD anyway so there wouldn’t be an actual financial impact. They would generally do their regular duties later.”
Anders said during the month of April, Austin Water has expended about $270,000 of the $5 million allocated to help about 1,300 low-income people with their water bills. Council Member Alison Alter seemed concerned that not enough people were getting help through the program and wondered if they would actually spend the $5 million allocated for that purpose. Anders assured her that the utility would spend that money on a timely basis as more people become eligible and apply for assistance. Council approved the additional allocation on April 9.
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