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Financial Fallout Facing Denton County PDF Print E-mail
Written by Tom Hayden   
Friday, 11 January 2013 08:30

When going through your monthly bills, do you ever ask yourself, why is my water bill so high?  Are we using too much water? This is an ongoing question in our household, as I routinely ask "Honey, have you been messing with the sprinkler system?"

Since serving on our Council, I have learned that instead of asking my wife this question, we would be better served posing this question to our wholesale provider.  If you are a resident of Denton County, certainly you gasp when opening your water bill as our wholesale water costs are among the highest in North Texas.  The cost of water in Denton County has been increasing at a rate that is much higher than that of inflation, and if responsible decisions are not exercised, you, as a resident of Denton County, haven't seen anything yet.  The worst is yet to come.

The Upper Trinity Water Regional Water District supplies water to many municipalities and special water districts throughout Denton County including Flower Mound, Aubrey, Sanger, Point Pilot, Corinth, Celina, Argyle and the Bartonville Water Supply Corporations to name a few and many more throughout our region.  There are a total of 28 members of the Upper Trinity Regional Water District. Flower Mound is the largest Upper Trinity customer with a subscription that is more than 40 percent of the Upper Trinity's total capacity. The second-largest customer is Corinth, which subscribes to 10.5 percent of the Upper Trinity's capacity.

This brings us to mid-January 2013, when the Upper Trinity goes before the Texas Commission on Environmental Quality (TCEQ) process for consideration of a permit to build Lake Ralph Hall, a lake that the Upper Trinity estimates will cost $275 million in today's dollars.  An independent analysis of the Lake Ralph Hall project has estimated the cost could be as much as $450 million.  To put this in perspective, the Upper Trinity currently has more than $290 million in debt, and the lake will be almost entirely financed with additional debt.

Flower Mound has two sources of water, Dallas Water Utilities, where we subscribe to 27 percent of our water and the remainder is purchased from the Upper Trinity.  When a municipality purchases water there are two costs that are applied, a fixed cost for the amount subscribed, and a variable cost. Below illustrates what Flower Mound is charged to purchase water on a wholesale basis:

Fixed Cost per 1 million gallons subscribed  -  Variable Cost per 1000 gallons purchased

Dallas Water District  -  $200,000 -    35 cents
Upper Trinity Water District  -  $370,000  -   86 cents

That is correct, currently the Upper Trinity is approximately twice the cost of Dallas Water Utilities; and you guessed it, when Lake Ralph Hall is built it is only going to be more expensive.

Since the Town of Flower Mound is the largest subscriber, many of the smaller municipalities and districts have allowed Flower Mound to carry the water and be the most vocal challenger to Lake Ralph Hall.  However, make no mistake; Lake Ralph Hall has the potential to cripple every member of the Upper Trinity Regional Water District if unchecked. 

In November, I as Mayor went before the Upper Trinity Board and apologized for any past animosity between the Town of Flower Mound and the Upper Trinity, and said we would like to work together and would be willing to drop our opposition to Lake Ralph Hall.  However, to drop our opposition we requested,  before the Upper Trinity Board expends millions of dollars more on Lake Ralph Hall, that they would exercise due diligence and explore the availability of a more economical source of water.  If one is fiscally responsible, that seems like a reasonable request.

Currently, Dallas Water Utilities is in the process of doing multi-decade water supply planning. We believe with the infrastructure currently being built which will connect Lake Palestine to the Dallas Water Utilities system (a lake that will have a capacity that is 350 percent greater than Lake Ralph Hall) that Dallas Water Utilities will be able to supply water not only to Dallas, but also Denton County for many, many years to come.

Additionally, Flower Mound requested that the Upper Trinity Board establish parameters of absorbing their current capacity before spending hundreds of millions for more supply.  The Upper Trinity is a long, long way from being at its peak capacity. 

Do you, as a customer of the Upper Trinity, think it is unreasonable to request the Upper Trinity Regional Water District see if a more economical source of water is available before spending hundreds of millions of dollars?  Is it unreasonable to ask the Upper Trinity to establish parameters so that they have additional customers to pay for this lake, instead of forcing current customers to pay for something that may not be needed for 30, 40, or 50 years?  I would think the Board would have a fiduciary responsibility to all customers, and would certainly want to explore such a suggestion from their largest subscriber before burying everyone in the district in debt.

Instead, the Upper Trinity Board said we are not interested in your proposal and have nothing further to say.   

Yes, that is correct, and I was just as speechless as you when informed of their response.  I'm still confused as to why they would not want to ensure a more economical source is not available before issuing a mountain of debt on the backs of their customers.

Several times I have been asked, "Tom how can you question more water? Isn't that like being against baseball and apple pie?"  My response has been, "I'm not opposed to increasing our supply, but I am opposed to being forced to pay champagne prices for more water, especially when it may not be necessary."   Flower Mound does not want to oppose Lake Ralph Hall, but we do seek financial accountability from the Upper Trinity Regional Water District.  We would like to see Lake Ralph Hall built when it is needed, not just a want. 

Additionally, what would the Lake's namesake, Congressman Ralph Hall, long a fiscal conservative, think of a Lake bearing his name, one built on a tall slope of debt, when all possible alternatives have not even been fully explored.

If you are concerned about your utility bill; one that is already substantial and beginning to snowball, I would encourage you to contact your local elected officials who appoint the representatives to the Upper Trinity Board of Directors, and encourage them to act in a fiscally responsible manner.

 

 

Comments  

 
+3 #7 Jeff Brinch 2013-01-16 09:13
"Water needs are important and water infrastructure is not cheap. The Upper Trinity is long term planning appropriately and FM just has sour grapes because they subscribed to too much water."

OK, that sounds accurate based on what I've heard. So then, if Flower Mound is essentially overpaying now, why not allow us to lock in our current rates for some period of time, to protect us from bearing the burden of a project which will not be pertininet to the Towns needs?
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-1 #6 Hold on now! 2013-01-15 22:03
Flower Mound is not the babe in the woods and Mayor Hayden is not being complete with the story. The real rub is that poor planning lead to Flower Mound subscribing to WAY more water than it needed. Water needs are important and water infrastructure is not cheap. The Upper Trinity is long term planning appropriately and FM just has sour grapes because they subscribed to too much water.And besides Mayor Sue in CC i don't think any other members of Upper Trinity have supported the FM position.
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+9 #5 @bian 2013-01-13 17:42
It's easy to spend other people's money. A great weekend getaway for somebody on the checkbooks of Denton County residents.
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-5 #4 Kurosh Bian 2013-01-13 15:44
No matter where you get your water from or how much, If Lakes are not built fast enough, short falls have to be provided from some where & that will Hurt all of us Texans.
Any attempts against any Lakes in Texas Will be Underserving Texans, to say the least.
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+7 #3 Jack Bowers 2013-01-13 13:54
Tom, I saw the article in the Dallas Morning News today. Thanks for your efforts. All the Upper Trinity can talk about is avoiding a water crisis. They don't seem to care about a financial crisis. They are kids with credit cards trying to turn us into Greece!
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+18 #2 Tom Hayden 2013-01-11 13:40
Yesterday I attended the Upper Trinity meeting; second one in the last couple of months, got up and asked them to work with the Town of Flower Mound to help us come to a resolution, to work with us. Waited around and as they came out of closed session, the response, no action taken. By the way, we have trying for two years to have the Upper Trinity come to a council meeting to talk to us and the residents of Flower Mound. They are not interested. I think Flower Mound is still the customer of the Upper Trinity, their largest customer, although you would never know that by how we are treated. Regarding their finances, they so are leveraged, that S&P when writing their Credit Report says the only reason they are rated where they are is because they can compel Flower Mound to pay whatever they like. The S&P report refers to no other towns, just Flower Mound. Perhaps I should have a conversation with their bond holders. The hearing date for Lake Ralph Hall is Tuesday, Jan 15th.
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+11 #1 Bob Weir 2013-01-11 13:14
This is the type of proactive attention to fiscal austerity that I admire in public officials. When Mayor Hayden visited with the Upper Trinity board he was attempting to make a better deal on future water rates for his Flower Mound constituents, a deal that would undoubtedly have a positive affect on the water rates for other municipalities as well. For him to be summarily dismissed by that arrogant bunch of dictators is tantamount to a slap in the face to all FM residents. To treat their largest subscribers, the people who pay their salaries, in such an ignominious fashion is indicative of a public utility that is out of control. I hope the mayor uses all necessary resources to bring this matter to the public's attention. Moreover, I certainly hope to see some journalistic scrutiny of an otherwise clandestine agency. Meanwhile, I want to sincerely thank Mr. Hayden for taking the lead on this very serious matter.
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