City of Austin

(Austin)- The Austin City Council has approved a rate increase for Austin Water that will be effective on all bills after November 1, 2011. The new rates will enable Austin Water to continue providing clean, affordable, reliable water to a population of more than 900,000 customers.

The 2012 approved budget includes rate increases on water and sewer service of 5.1%. The volume usage rate increase will affect the highest water users most. Households that use more than 15,000 gallons monthly will see the greatest increases. The new volume usage rate will benefit customers who conserve water. Additionally, the Council approved a new fixed fee called the Revenue Stability Fee. This rate increase and new fee will generate $32 million in projected additional revenue for 2012. This additional revenue will be used to pay for increases in operating costs, debt service, transfers and compliance with financial policies.

New Fixed Revenue Stability Fee

The new, fixed Revenue Stability Fee was approved for 2012 and will significantly enhance Austin Water's revenue stability. The fee is $4.40 for a 5/8" meter, with larger meters having a higher fee. This fee will generate $17 million in 2012 that will be collected regardless of how much water is sold during the year. Because most of the Utility's revenue is dependent on the selling of water, our revenue can be impacted significantly by reduced water sales due to weather conditions, economic conditions and water conservation. Low-income residents that qualify for the customer assistance program would be exempt from the new fee. This additional fixed fee revenue will increase the amount of fixed revenue that is collected each year, which will lessen the potential revenue shortfalls that might be seen in the future. This is an important first step in stabilizing Austin Water's financial position for the future.