In continuing negotiations with its water supply utilities, Pflugerville City Council set the stage for a new round of agreements with SouthWest Utility Co. and Manville Water Supply Corp. at its Feb. 25 meeting.

A 10-year deal struck between the city and SouthWest aims to bring stability to water and sewer service rates for customers in the city. SouthWest has agreed to adjust water rate prices annually in accordance with percentages from the Consumer Price Index, which measures the variation in prices for different goods consumers purchase each month. Pflugerville City Manager Brandon Wade estimates SouthWest customers will now see a price increase of about 1 percent each year.

In 2011, California-based SouthWest sought to merge its Pflugerville-area water provider, Windermere Utility Co., as well as several other water supply companies, under a larger system to be called Monarch Utility Co. The merger would have brought with it a 63 percent water rate increase for SouthWest's approximately 5,000 Pflugerville-area homes.

"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," Pflugerville Mayor Jeff Coleman said.

SouthWest has frozen customers' rates during the past two years. Under the new agreement, the company will not proceed with the merger, and its rate increases will be approved by city staff before going into effect. After its first 10 years, the agreement can be extended for another decade.

"This is going to be very good for the customers and the community," said Gary Rose, SouthWest's director of operations. "It [also] allows the company to continue making improvements to the water/sewer infrastructure at the same time."

A separate agreement between the city and Manville Water Supply Corp. will change how the area once known as Travis County Municipal Utility District No. 5 receives water.

The MUD was annexed into Pflugerville more than a decade ago but is 16 years into a 40-year agreement with Manville for water services. Today the former MUD area encompasses the Highland Park, Highland Park North and Springbrook subdivisions.

Currently the city purchases water from Manville, and the water is pumped through Manville lines to the MUD area. Under the new agreement, which is still being negotiated, Manville will continue to provide water but will pump it to the city's water treatment plant where it can be mixed with city water before being pumped to the area.

"We are wholly responsible for our pressure, flow and water quality, and [Manville will] continue with their income stream [from providing the water to the city]," Wade said.

The city will continue negotiations with Manville, including possibly taking over water provision areas from the company and providing Manville with water to supply to other areas.