April 24


How SAWS keeps its head above water

SAWS raised its rates in late 2010, cut many of its expenses, and – thanks to the drought – sold more water than ever before last year. As you'd expect, the bottom line looked great, with the City-owned utility recording an after-expenses surplus of nearly $24 million in 2011. Balanced against ratepayers made a little poorer by their water bills, the result seemed to be good news for an agency that suffered losses totaling $67 million over the previous two years.

But its flush condition had more to do with good lawyers than good managers. Also, the news obscured SAWS' ongoing struggle to tame the cost of benefits for its retirees, and it came with the threat of future trouble – a potentially large settlement it might have to pay for violating the federal Clean Water Act. Both played into the rate hike approved by the City Council in December. And they'll likely turn up in future "rate adjustments" – alongside big money wired into the increases for long-term water supplies beyond the Edwards Aquifer.

SAWS may sell the cheapest water among Texas' big cities, but it's going to get a lot costlier.

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