State staff says water contract in North Texas is ‘unreasonably preferential’

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Staff with the Public Utility Commission of Texas recently weighed in on a dispute among area cities, saying current water rates are “unreasonably preferential, prejudicial and discriminatory.” The PUCT is seen as a third party on the matter.

At issue is the North Texas Municipal Water District water contract used to calculate how each of its 13 member cities pays for water and services. The water district uses a contract where cities pay for the highest historical usage regardless of how much water is used that year.

Discussions about the contract began in 2016 when the cities of Plano, Garland, Mesquite and Richardson filed a petition asking the PUCT to review the water contract.

The PUCT staff recently filed its review of the water contracts, finding them “not in the public interest,” according to a November court filing.

Commissioners appointed to oversee the PUCT are expected to decide on the case this spring, Janet Rummel, public relations and communications officer for the NTMWD, said in an email.

“The [NTMWD] believes a better solution would come from the member cities negotiating with one another for any change to the contract structure,” she said.

The other NTMWD member cities include McKinney, Allen, Frisco, Farmersville, Forney, Princeton, Rockwall, Wylie and Royse City.

If the commissioners agree with the PUCT staff and the four petitioning cities, it could result in rewriting the member cities’ contract. Rummel said that could result in some cities, such as McKinney, paying a higher portion of shared costs. This cost could be passed along to residents or absorbed by the city.

The water district charges not only for used and unused water but also storage, pipes, treatment and testing of the water. It also charges for investments in projects to make sure the district does not run out of water, Rummel said in a previous interview with Community Impact Newspaper.

To divide the cost of the shared system among the cities, the 13 member cities agreed for each city’s portion to be based on its year of highest annual water use, Rummel said.

“NTMWD issued debt and built a system to meet that previous need. We must repay the debt and maintain those pipes,” she said.

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Cassidy Ritter
Cassidy graduated from the University of Kansas in 2016 with a degree in Journalism and a double minor in business and global studies. She has worked as a reporter and editor for publications in Kansas, Colorado and Australia. She was hired as senior reporter for Community Impact Newspaper's Plano edition in August 2016. Less than a year later, she took the role of editor for the McKinney edition.
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