City Council called for the external audit last spring following a string of water quality incidents affecting local residents and businesses. The most recent was the citywide boil-water notice last February that prompted the audit and the resignation of the utility's previous Director Greg Meszaros.
The audit's release comes two weeks after Meszaros' successor, former AW Assistant Director Shay Ralls Roalson, was appointed to helm the utility. Roalson will be responsible for taking on the dozens of recommendations for AW operations forwarded by The University of Texas auditors, several of which are already being addressed.
The city estimated that the audit, conducted by UT's Center for Water and the Environment, cost around $816,000. The full audit may be viewed here,
Austin Water is one of the largest city departments with a $684.57 million operational budget for fiscal year 2022-23 with funding for more than 1,300 staff positions—many of which remain unfilled. The utility is also supported by an extensive capital spending budget that allotted $236.91 million for improvements in 2022-23 and $1.13 billion planned for 2024-27.
Council's audit committee is scheduled to review the full report next week. District 10 Council Member Alison Alter, who chairs the audit committee and sponsored council's request for the UT analysis last year, said the report lays out a road map for officials and city management responsible for the utility's oversight to focus on.
“The sense that I got was that the evaluators believe we are able to handle things, and we are set up well for ... the normal, everyday water treatment issues, but that we still have a lot of work to do with respect to extreme events—but that it may be more of an organizational, structural, training mindset issue than infrastructure investments that will be key moving forward and being better prepared," Alter said.
Water treatment focus
Before last February's incident, Austinites had previously endured a series of weather-related citywide boil-water notices and water service disruptions within a five-year span.
UT's audit team credited AW for responding "favorably" to the after-action reports produced in the wake of those events and said the majority of relevant recommendations have either been rolled out as suggested or are now in the works.
However, researchers also found room for improvement in certain respects at Austin's central Ullrich Water Treatment Plant. The 55-year-old facility near West Lake Hills supplies a majority of the city's drinking water sourced from the Colorado River along with two other plants to the north. Employee error at Ullrich was found to be the root cause of the water quality worries that resulted in last February's boil notice.
The new report said Ullrich continues to produce high-quality water for residents and identified a culture of commitment to AW's work among staffers there. Despite those findings, auditors also questioned aspects of the plant's operations and said further review of planning, equipment and work processes may be needed to better prepare the facility for disruption.
" ... [T]here is also evidence that AW’s organizational structure, management practices and internal communications at Ullrich WTP have led to deficiencies that make operations more vulnerable to mistakes, especially during emergencies," auditors wrote.
Workforce support
As cited by Meszaros last year soon after the boil-water notice lifted, auditors said staffing concerns remain at AW and likely contributed to recurring flaws in operations.
With the Ullrich facility's vacancy rate now sitting around 30% and hiring efforts still proving difficult, auditors also warned that staffing shortages will lead to burnout among remaining employees and potentially hurt the response to potential future incidents.
Additionally, multiple staff interviews revealed persistent frustrations with pay and promotions. And for everyday operations, auditors maintained that AW employee training is inconsistent and insufficient in some cases.
Alter, who said Austin's overall staffing difficulties remain a top concern heading into council's new term, noted the tie Austin Water's situation has to the city's recruitment and retention trends as a whole.
"It sounds like there are just some real basic management practices that need to be improved, whether it’s the standard operating procedures, whether it related to training, whether it related to recruitment and retention," she said. "I was struck by how similar this sounds to challenges we have in other departments, and so it was very interesting to see it laid out specifically for Austin Water and have it articulated in those particular ways."
Auditors said AW's management structure may also be "unbalanced" and ask too much of certain positions responsible for overseeing critical water treatment processes. They also found evidence of internal conflict and listless leadership at Ullrich, hurting morale and the overall working environment at the facility.
"There appears to be no overarching direction to staff at the plant, with the accompanying issue that no single set of standards is used to either reward staff or hold them accountable," auditors said. "Strong division amongst the staff supporting one or the other of the superintendents’ approaches to the work is apparent, which disrupts staff teams who are 'taking sides.' Ultimately, this results in the inability of the plant staff to operate as a team, with the work not being well directed and unacceptable behaviors going uncorrected."
Auditors said AW is likely in need of consultant services to suggest improvements to processes at Ullrich, and that the facility should fall under the leadership of a single manager.
Further review and recommendations
The audit also dove deeper into areas, such as water quality and treatment, emergency response, public communications, and more, with multiple suggestions made in each subject area.
In total, the audit process produced 53 recommendations for AW and city leaders to consider. Roalson said Jan. 11 the utility agrees with 49 of those proposals and has already begun implementing 19 of them in her early days as director. She also highlighted several resiliency gains AW has made and pointed to a top goal of addressing the staffing problem.
"While Austin Water is well-positioned in many ways to respond to risks and threats, we certainly have felt the impacts of staffing shortages and employee retention," Roalson said in a response memo. "We agree with many of the recommendations within this report, and I am committed to collaborating across the city organization to address and resolve issues raised to support the needs of Austin Water employees and our community."
Points of disagreement between the utility and its auditors included separating city and AW human resources, setting a direct line of reporting between AW and City Manager Spencer Cronk, and limiting the "span of control" among utility leaders during emergencies.
All audit recommendations and AW's responses may be viewed below.
