Robert Puente, president and chief executive officer of San Antonio’s water utility, will stand before City Council on Thursday to make the case for two years of rate increases: 5.8% in 2018 and 4.7% in 2019.
The additional revenue, totaling $63.5 million, will be used for water supply, delivery, and wastewater projects that Puente calls “critical” to the city’s water security. San Antonio Water System customers have seen rate increases each year since 2011.
“Nobody likes rate increases – they’re painful. But [citizens] can hopefully come to trust that we’re doing very well with their dollars,” said Puente, who gave the SAWS board an overview Tuesday of necessary service and program expansions the utility has completed with those revenues. Click here to download the presentation.
SAWS’ request has substantial support on City Council, including from Mayor Ron Nirenberg. But at least three council members, Greg Brockhouse (D6), Clayton Perry (D10), and John Courage (D9) say they won’t support the increase, siding with environmentalists who say residents already pay too much for water and challenging compensation for Puente that could exceed $468,194 in 2018.
“I’m voting ‘no’ on it,” Brockhouse told the Rivard Report. “All these increases are compounding, and I don’t know how a citizen is going to approve of this, afford this, and feel like this is the highest use of their dollars.”
San Antonio has some of the lowest water rates in the state compared to other major cities, Puente said, even with the proposed increases. It’s unclear if that will remain true in 2020, when SAWS predicts another 12.4 percent increase in order to start buying water from the Vista Ridge pipeline.
Terry Burns, president of the Alamo Sierra Club, said SAWS should abandon Vista Ridge and start focusing on water conservation and catchment projects, but SAWS officials say those strategies are insufficient in face of the area’s expected growth. Burns said the Vista Ridge project only benefits developers and business interests by perpetuating the myth that San Antonio has plenty of water – just like SAWS’ “Waterful” campaign.
Burns also called for the utility to research and adopt a new rate structure that would put less burden on ratepayers.
“We just don’t want wasteful, boondoggle projects that only benefit developers and encourage sprawl,” he told the Rivard Report before the meeting.
Puente said SAWS reviews its rate model every five years and such a review is due in 2018.
“Sprawl is really an issue for City Council – whatever their growth policy is [is] what we’ve adopted,” Puente responded when the Rivard Report asked whether SAWS’ water supply projects promote sprawl. “State law dictates that if you are in our service area, we have to service you.”
The “Waterful” campaign promotes SAWS’ water projects, conservation efforts, and diverse water supply. “We’ve taken great pains in the last 10 years to get additional water sources to this community so that we can grow [economically],” Puente said.
But growth will come with or without Vista Ridge, Puente said, stressing that SAWS wants to ensure that San Antonio doesn’t end up without the water it needs.
About $5.1 million of the revenue from the next two-year rate increase will go towards funding the 142-mile pipeline. A majority of the revenue will be spent on other projects like replacing aging pipes and water delivery.
“The vast majority of the rate increase is going to infrastructure,” Nirenberg told the Rivard Report via email after the meeting. “The portion of the rate increase that goes to water supply was previously approved by City Council. The city’s population is expected to grow by as much as a million people by 2040. Our only rational choice is to acquire new water sources. Estimating our future water need is not a gamble that we want to lose.”
Thursday will be Courage’s, Brockhouse’s, and Perry’s first opportunity to vote on a utility rate increase since they joined the Council in June. Councilwoman Ana Sandoval (D7) as well as councilmen Cruz Shaw (D2), and Manny Pelaez (D8) also are new to the Council. Shaw and Pelaez have indicated their support for the increases. Puente said with the new Council, SAWS expected to have to answer more questions about rate increases.
Brockhouse said he has too many lingering questions about SAWS’ budget and priorities to approve yet another rate increase, and it doesn’t have to do with being new to Council.
“Nobody wants to pay more money, but also the lack of trust of government agencies right now is so prevalent at City Hall,” Brockhouse said.
Ideally, Brockhouse said he would like to see the vote delayed further until two questions are answered: What’s the bare minimum rate increase needed to keep up with federally mandated repairs and operations? How many people are getting help paying their bills from SAWS’ various assistance programs?
While he’s fairly certain the rate increase will gain approval Thursday, Brockhouse said he’ll attempt to reduce the 2018 rate and leave 2019 for next year. He also wants to revisit the Vista Ridge project, which was unanimously approved by the previous Council in 2014.
“When we jumped into Vista Ridge, we were in a drought period, so our mindset was different,” Brockhouse said, adding that he doesn’t buy that the city’s anticipated growth justifies the $3.4 billion pipeline project.
“People have been moving here for 300 years,” Brockhouse said.
Not only is SAWS asking for increases, but property taxes and other fees associated with living in the city are going up, Perry said.
“We’ve got a lot of families and neighborhoods out there that are really struggling,” he said. “We need to tighten our belt before we start raising rates and fees.”
Other Council members support the rate increase and Vista Ridge project.
“We’ve got infrastructure from the 1950s and ’60s that – no matter how much we agree with or disagree with Robert Puente’s salary – the laws of physics apply to these pipes, and many are crumbling,” Pelaez said.
One metric Pelaez said he uses to judge Puente’s performance is SAWS’ top bond rating. “You get what you pay for,” he said.
At Nirenberg’s request, the SAWS board created a task force in September to review Puente’s salary. The mayor voted against Puente’s pay raise for 2018 that will boost his compensation to $468,194 from $445,894. He also could receive a $99,285 bonus.
“The task force is expected to present recommendations to the board by the end of the year,” Nirenberg said.
This story was originally published on Dec. 5, 2017.