Public Works has $46.3 million in extra revenue. So why raise water rates again?

Year plus long ‘DRAINED’ Investigation into the Houston water department

HOUSTON – Each week, we in our ‘DRAINED’ Investigation are showing you water bills for hundreds, even thousands of dollars that are “draining” Houstonians.

NEW TODAY: We are asking questions about the planned water bill increases and extra city money. Investigative reporter Amy Davis explains why some are questioning whether the city needs the extra revenue.

City of Houston water bill increase

Another water rate increase is coming for Houston water bill customers. But the City of Houston has millions of dollars in surplus from water bills. Why are we paying more? KPRC 2 Investigator Amy Davis asks Houston Controller Chris Hollins for answers. (Copyright 2024 by KPRC Click2Houston - All rights reserved.)

Water rates increase automatically every April through 2026. The next water rate increase takes effect in less than two months, on April 1. But already, Houston Public Works is sitting on more than $46 million in unexpected revenue this fiscal year.

While Houston water customers struggle to pay or dispute outrageous water bills, the city of Houston’s Public Works department is feeling pretty flushed.

“Total operating revenues increased by $46.3 million, primarily due to higher than anticipated water and sewer revenue,” said Chris Hollins, City of Houston Controller.

Halfway into the fiscal year, new City of Houston Controller, Chris Hollins, reported to the city council that the combined utility fund collected $46.3 million more in revenue than expected, and it spent $41.1 million less than projected.

Another water rate increase is coming for Houston water bill customers. But the City of Houston has millions of dollars in surplus from water bills. Why are we paying more? KPRC 2 Investigator Amy Davis asks Houston Controller Chris Hollins for answers. (Copyright 2024 by KPRC Click2Houston - All rights reserved.)

“We’re taking in way more money in the water/sewer system, and we’re spending less,” said Council member Sallie Alcorn (during the city council meeting).

Council member Sallie Alcorn pressed the finance director for answers.

“We seem to be coming in ahead every time, which concerns me because people’s water bills are high. Is that the reason? Are we having higher-than-expected water bills? Or..?”

“I don’t want to get ahead of the mayor on that, I know he might,” said Finance Director Melissa Dubowski.

“Okay, not getting ahead of the mayor. Just pointing it out,” said Alcorn.

Why is the Houston water department taking in so much more money than expected?

When the city council voted on the 5-year automatic water rate increase in 2021, Public Works said they needed the extra revenue to maintain and repair the water infrastructure and equipment. But why is the water department making more money than it expected?

We met with Controller Chris Hollins to ask about this.

“The reason that we’re seeing more increased revenues in FY 2024, so far, is largely driven by customers using more water during the drought for critical services,” said Hollins.

Another water rate increase is coming for Houston water bill customers. But the City of Houston has millions of dollars in surplus from water bills. Why are we paying more? KPRC 2 Investigator Amy Davis asks Houston Controller Chris Hollins for answers. (Copyright 2024 by KPRC Click2Houston - All rights reserved.)

“So you could see a significant increase in usage of water that people used. They used more because of the drought?” asked Amy Davis.

“Correct,” said Hollins.

“And you’ve seen those numbers?” asked Davis.

“You’d reach out to the administration,” said Hollins.

We did ask the city’s finance director the same question and the City of Houston’s Communications Director, Mary Benton, sent the following statement:

“The December quarterly report presented last week reflects an increase of revenues for the Combined Utility System in the amount of $46.3 million compared to budget. The revenue is primarily due to increased consumption attributed to drought conditions, and partially offsets costs attributed to the drought.

The September quarterly report reflected an increase in expenditures of $61.7 million primarily due to higher costs than budgeted for chemicals and electricity to treat and distribute more water to meet this higher demand and emergency repairs on water main breaks.

‘DRAINED’ will continue to monitor both revenues and expenditures and projections will be updated in future reporting periods.

There will be a forthcoming rollout of a water bill relief program proposed by Mayor Whitmire soon.”

Audits to scrutinize Public Works spending

In the same council meeting, Mayor John Whitmire told council members he would conduct audits to get a clearer picture.

“We will be doing audits. Not only does the controller have a responsibility to do audits, but we will be doing audits to establish the condition of the departments we found when we got there,” said Whitmire.

We don’t know when the mayor’s audit of Houston Public Works will begin. The controller said his office had already started their audit.

“What we’re gonna be focusing on is the Public Works customer service department. They’re responsible for the bill collection. They’re responsible for the water meters and so on. As well as credits that folks might receive when there are issues. So we’re looking forward to digging in there and coming back with some answers.

Hollins said his audit will take several months and it may be as late as June before it is ready.

We do know that Mayor Whitmire is already working on a plan to help water customers and make some changes he has described as pretty major at the water department.

We will not stop the ‘DRAINED’ Investigation

Amy Davis and the team will keep bringing you any new developments on Houston water bills including the new plan Mayor Whitmire is expected to release soon.

If you have a water bill issue, there’s a good chance we’ve covered that topic. Check out all of our ‘DRAINED’ Investigation to find the help you need.

Email Amy Davis or Producer Andrea Slaydon if you can’t find the help you need.


About the Authors:

Passionate consumer advocate, mom of 3, addicted to coffee, hairspray and pastries.

Award-winning TV producer and content creator. My goal as a journalist is to help people. Faith and family motivate me. Running keeps me sane.