HOUSTON – Houston’s latest water rate increase took effect April 1st. The city said the average customer will notice about a 9% increase in their monthly bill. Investigative reporter Amy Davis crunched the numbers to show you what it looks like on real accounts and she’s sharing what the city may do with the extra money.
Public Works has told KPRC 2 repeatedly that the money it collects is not profit and the water department can only collect the amount of money it needs to provide water service and for maintaining the city water equipment and infrastructure. It is obviously collecting a lot more money lately with four water increases since July 2021.
We introduced you to Kevin Anderson in February living in South Park on Houston’s south side.
“I’m trying to figure out what’s the math, what’s how is this being calculated,” said Anderson.
He was already doubting the accuracy of his water bill when 4,000 gallons of water cost him $88.28.
As of April 1st the same amount of water will cost him seven dollars more $95.30. That’s $7.02 more- an 8% increase.
Amy Davis looked at her own water bill. Here’s what she found:
- 10,000 gallons of water In March 2024 cost $233.89
- 10,000 gallons of water in April 2024 costs $249.62
- $15.73 more for the same amount of water- a 7% increase.
All that extra money means the city’s Combined Utility Fund (where all of the water and sewer revenue goes) is flush.
Idea of a ‘franchise fee’ for city water lines
“You are broke if you’re spending more than you’re bringing in. Broke is when your not paying your bills- but we’re gonna fix it,” said Houston Mayor John Whitmire at a City Council meeting on April 3rd.
Houston Finance Director Melissa Dubowski shared her latest financial report with the council, explaining the city was looking at a $160 million budget shortfall in the next fiscal year. Add to that, the need to cover the recent pay agreement with firefighters, and Houston is looking seriously low on cash.
At the same meeting, we got a peek at one way Dubowski thinks we get some extra revenue to pay for city services.
“Right now we get something called a franchise fee for our electricity, cable tv, natural gas and we charge outside entities,” Dubowski explained at council. “One thing that we’re still exploring and we do still have some work to do and we do need to work with the legal department as well. But one thing we’re exploring for the future is there are other cities that charge their utility, their water utility for - it’s basically a franchise fee or could be called a rental fee for running their water pipes underneath city right of way.”
Councilmember Sallie Alcorn immediately bristled at the idea.
“I’m not sure I’m in favor of taking any money from the CUF (Combined Utility Fund),” said Alcorn.
“It’s something we’re exploring,” said Dubowski.
“When we’ve got a lot of problems with the CUF and needing that money. I thought I was understanding that yesterday. But I don’t think that’s a great place to start- get money from the CUF,” said Alcorn.
Did you get that?
The idea is for the city of Houston to charge its water department a franchise fee for all the water and sewer pipes in the city’s right of way underground. The finance director would essentially using water and sewer funds to make up for the shortages in other parts of the city’s budget.
Davis asked Houston Mayor John Whitmire about it the following day in a news conference.
“Everything’s on the table and I’ll be visiting with Councilmember Alcorn, with our dept heads and we’ll address that,” said Mayor John Whitmire.
When Davis emailed Dubowski for more information, we received this statement from the Mayor’s Communications spokesperson attributed to Dubowski:
“This is a concept that the city is in the very preliminary phase of exploring. Other Texas cities that utilize a similar concept include San Antonio, Austin, and Dallas. The concept still needs to be vetted from both a legal and financial standpoint.”
For now, the idea is just one the finance director has shared with council as a way to make up for a $160-million-dollar budget shortfall next year. We will stay on top of this and let you know what happens next.
