Birmingham Water Works proposes 4.9% rate increase, new rate structure for 2025

BIRMINGHAM, Ala. (WBRC) – The Birmingham Water Works Board on Wednesday approved a preliminary budget plan that includes a 4.9% rate increase, a change to the utility’s rate structure and $10 million to begin purchasing the new meters needed to move utility to automated meter reading as early as 2028.

According to the proposed budget for 2025, what the Water Service considers is the “average” customer who on a residential bill using 6 CCF of water per month will pay approximately $2.14 more per month. The utility is also reducing the cap for its highest rate level from 16 CCF to 13 CCF, but says action has been taken to spread the increase more evenly.

“Each block will have a slight increase, so no one will miss this opportunity,” said BWWB Interim GM Darryl Jones. “It turns out that if you’re above 12, you’re actually going to be a little better off because the old structure – everything above 15 was an even higher rate, so by bringing it down to 12, it allows us to shift and share some of those increases throughout our tariff structure. Therefore, it is a fair and equitable way for all customers to share equally in rates as they increase.”

Here is the comparison of old and new fee structure:

For comparison, the BWWB increased residential rates by 4.8% in 2024, 3.9% in 2022 and 2023. It did not increase rates in 2019, but increased rates by 3.9% in 2020 and 2021.

The new operating budget of US$142 million represents a US$5 million increase over last year, while the capital budget jumps from US$83 million in 2024 to a projected US$115 million in 2025. Of this total, US$ 10 million will be spent to boost the utility’s shift to automated meter reading by starting to purchase the new meters that will eventually have to replace all of the approximately 215,000 residential meters. This process will begin with the purchase and installation of some of these meters next year as old meters break down or are replaced.

“We’re going to start installing some of these meters that are AMI compliant, meaning they have the infrastructure built into the meter so they can transmit the information,” Jones said. “We won’t have the receiving part yet, but we want to start this whole project.”

Water Works’ new interim executive team told the board Wednesday that the utility needs to update its SAP software program that governs several key functions including billing in the coming years, and will have to do so as it launches the Automated Meter Infrastructure program (AMI). this will work with this. Given the scope of both projects, the board learned Wednesday that the system currently expects to roll out automated meter reading to all of its residential customers sometime in 2028, if the current timeline holds.

Jefferson County Commissioner Shelia Tyson told the council Wednesday that day can’t come soon enough for her constituents.

“I want to thank the water board for getting serious about starting this smart meter program,” Tyson said. “Because I know that the previous council was unable to get started. But I would urge you to go ahead and get started, because we are again getting calls about $3,000 and $4,000 water bills arriving in people’s mailboxes. I don’t know what the problem is, but I know bills like this shouldn’t go to a resident. I want to thank you for starting the program and urge you to go ahead and start it for real. Because citizens are suffering from this and the increase in bills they receive in the mail.”

The Water Works Board also learned Wednesday how dramatic the improvements have been in the billing department since interim GM Darryl Jones brought back former GM Mac Underwood and several other former BWWB employees on an interim basis to evaluate and review their billing operations and customer service.

The concessionaire reported that it had to estimate 8,430 residential accounts in the month of July, or around 4.3% of the system’s 197,000 current accounts. In July, the system also eliminated 25,230 “implausibles,” or readings that were outside what the system considered normal parameters for that account. In September, that number fell to 1,263 estimated accounts and 13,121 implausible ones.

“A lot of things have changed,” says Jones. “We were able to place our vehicles. At one point we had over 14 vehicles sitting for our meter readers and support staff. we have our vehicles in place. The efficiency of what is happening has improved a lot and this is the main driver of what happened. Let’s continue moving in this direction, let’s continue to make improvements. We will ensure that when customers receive their invoice, it is an accurate invoice. We also want them to have a current account every month, that’s our goal.”

The rate increase, new rate structure and budget proposals will be presented to a public hearing on November 4 at 5:30 p.m., before council is expected to vote on them at a meeting following that hearing.

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