[Updated to include an April 3 news release from Southwest Water Supply Corp. and the City of Pflugerville]
The City of Pflugerville and SouthWest Water Corp. announced in a news release April 3 that negotiations and discussions set to expire April 10 concerning water and sewer services will be extended through April 9, 2014. Pflugerville City Council is expected to vote on the extension at its April 9 meeting.
The release also stated if the extension is approved by council, the city will continue service with Southwest through April 9, 2014. SouthWest has agreed not to raise rates during that period.
Pflugerville attempting to fix utility service, billing issues
As Pflugerville continues expanding from a small town to a mid-sized Central Texas city, increased utility infrastructure is needed to continue serving its nearly 50,000 residents.
Water utilities within the city have been a top priority for residents and the city for years, including issues with line breaks, boil water notices and high water rate prices. Pflugerville City Manager Brandon Wade said the city is quickly outgrowing the existing water service capacity that was originally built for a city not expected to exceed 15,000 residents.
“When it’s time for an area to develop to an urban density, conflicts arise,” Wade said.
Pflugerville and its unincorporated extraterritorial jurisdiction, or ETJ, are jointly served by the city’s utility system and the Aqua, Windermere and Manville water supply corporations. Each provider delivers water to a portion of the city based on contracts of convenience and necessity, which were established decades ago and dictate what areas a utility has the right and responsibility to serve. The contracts restrict the city from forcibly taking over Pflugerville’s utilities.
The water providers use the utility areas as collateral on federal loans, and the revenue from water rates helps the providers pay bills and debt.
Issues with Manville
Manville is a nonprofit 501(c)12 that primarily provides water service to rural areas, including East Pflugerville, which until the last decade was mostly undeveloped land.
As a rural provider, Manville’s pipelines are smaller and built to serve fewer customers. Its pipes have fewer points at which water pressure can be monitored, so when pipes malfunction or break, it is harder to isolate problems, and more customers are affected, Wade said.
Manville has issued at least six boil water notices to Pflugerville customers since July 2010, each lasting at least several hours. Problems have included machinery breaking down, resulting in untreated, non-chlorinated water being sent to customers. However, Manville spokesman Robert Cullick said the corporation has not had more notices than normal for water utility providers. He added that Manville’s notices have resulted from non-system failures, such as contractors striking pipes while digging or from pressure drops from a low water supply.
“I think every area served by utilities eventually has boil water notices,” Cullick said.
But Royal Pointe subdivision resident Craig Reineke said the notices happen too often and can cost money for people who use carbon water filters that need to be replaced after the notices are lifted because of possible contamination.
“It’s very much been an annoyance because of the fact it happens so frequently,” Reineke said. “Twice in a year is a lot, and then for it to [happen]six times in three years is uncalled for. It’s something that should have been planned for ahead of time, appropriately.”
Its smaller system also means that Manville cannot always provide the amount of water needed to meet the area’s demands, so the corporation buys water at $3.25 per 1,000 gallons from the city. The water is then pumped to customers within the city.
Despite having to purchase the water, Cullick said Manville has more than enough capacity to serve a growing customer base in the city.
“[The water supply system] links the rural areas with the urban areas; it ties in with Hutto, Pflugerville and Manor,” Cullick said. “It provides a lot of groundwater [to the area], so there [are]no water supply problems.”
One solution to the Manville supply issues may be for the city to work out a deal to acquire the utility company’s coverage areas and take over providing utilities. Manville has given Pflugerville some of its provider area in the past, and additional acquisitions may be possible in the future, Wade said.
However, Manville is only 16 years into a 40-year contract to provide water to the area that was known as Travis County Municipal Utility District No. 5 before being annexed into Pflugerville. That contract and other considerations, including Manville’s finances, are keeping the city from completely overtaking Manville’s service area.
“[Manville] relies on the revenue that they receive from [utility rates]to pay their bills,” Wade said. “So they can’t just sign [areas]over to us.”
While the current situation may not be ideal, Wade said Manville and the city are negotiating to work out the system’s problems. Cullick said the corporation maintains a good relationship with the city in order to continue enhancing service.
Pflugerville City Council approved building a “redundant” 24-inch water line at its March 12 meeting to run next to an existing Manville line along Heatherwilde Boulevard, which serves the Royal Pointe subdivision. The subdivision’s water system currently has only one feeder point, and the redundant city pipe will allow the city’s utilities to pump water to residents if Manville’s pipeline fails. Similar redundant systems could help alleviate issues such as boil water notices throughout Manville’s coverage area in the future, Wade said.
Because Manville has indicated to the city that it plans to continue as a rural provider, the city is also negotiating with the utility corporation to bring the company’s pipes up to urban provider standards.
“The city would like to see their standards at urban levels as opposed to rural levels,” Pflugerville Mayor Jeff Coleman said. “The city and Manville [are]trying to find areas where we can agree … or allow the city to take over the service.”
Issues with Windermere
SouthWest Water Corp.’s largest service area in Texas is made up of 5,000 residential and commercial connections through its Pflugerville-area provider, Windermere Water Supply Corp. As an investor-owned provider, the city has limited negotiation abilities with Windermere and SouthWest.
In August 2011, SouthWest proposed a sales transfer merger that would bring all of its smaller utility systems, including Windermere, into a larger system to be called Monarch Utilities. The proposal came with a 63 percent rate increase for its customers, which the city opposed.
“The city strenuously objected to [the rate increase], which caused us to enter into negotiations … to give rate stability to Windermere customers and attempt to lower their overall rate,” Coleman said.
Kevin McCarthy, a Windermere customer who lives on A.W. Grimes Boulevard, said high water bills were a factor in his family’s decision to move out of the Pflugerville area in the near future. McCarthy said his utility bills at his former home in Port Arthur were approximately $30 per month for water and garbage, while his current bills average approximately $120 per month for water alone.
Gary Rose, SouthWest’s director of operations for Texas Utilities West, said the company takes complaints such as McCarthy’s seriously.
“We’re going out and meeting with customers in the field,” Rose said.
In the past year, SouthWest has also set up a customer service hotline for Windermere customers.
Rose said new water rates are also being considered by the company, but he has received few complaints on water bills. SouthWest offers financial help by contributing $20 to qualified, low-income households’ monthly water bills with its Help2Others campaign.
In late 2011, the city adopted a resolution that considered severing service with SouthWest but agreed to a one-year discussion period with the corporation in order to come up with a mutually acceptable compromise. The period, which expires April 10, included discussions ranging from helping customers pay water bills to the city buying the Windermere utility.
Wade said he expects to announce an extension of the discussion period in early April. The announcement will come with the outline of a plan between the city and SouthWest that he believes will help satisfy SouthWest customers. Rose said new water rates will be included in the plan.
Utilities and further expansion
Sections of Southeast Pflugerville and its ETJ not served by the city, Manville or Windermere are currently under the Aqua Water Supply Corp.’s provider area. As the city expands further into Aqua’s provider area, Wade said the city will continue to work with Aqua to provide needed water utilities.
“We’ve had discussions with Aqua, and it appears that we’re going to be able to have a clear understanding that will outline our relationship from the very beginning,” Wade said.
Despite long-ago perceptions that Pflugerville would remain a small town, Wade said estimates put the city’s projected population at five times its current size if the area is fully built out. With that growth will come demand, and current discussion and negotiations with water suppliers is intended to meet that growth as it happens, he said.
“We’ve outgrown our size that we intended to be,” Wade said. “If Pflugerville develops at the same density [within]its footprint and the extraterritorial jurisdiction, we think Pflugerville could approach 250,000 [residents]in size. We’ve had to change our approach on just about everything.”