Giving AT leverage

If the City carries forward with its plan to fire Black Castle and then begin negotiations with Aqua Texas, it will soon learn that it has given away any negotiating leverage and has none. The City will be negotiating with itself. Remember the sign at Miss Mays BBQ Restaurant that said “You have two choices—take it or leave it.” Aqua Texas now has this sign. When the City goes before the Aqua Texas altar to learn what Aqua Texas will require from the City in order for Aqua Texas to provide service to the City, the City will understand that it has no negotiating leverage. The Mayor’s plan indicates that the CCN is sacrosanct and will not be given to Aqua Texas. However, Aqua Texas may decide that it is imperative for the City to give Aqua Texas the CCN. “Take it or leave it.” Also, Aqua Texas says it will convert its plant to produce Type 1 effluent for the entire Wimberley Valley. What incentive does Aqua Texas have now, in that the City has no counter proposal as it has given away its rights. Even if Aqua Texas says they will upgrade the effluent, we are reminded about Aqua Texas promising to repair all of the leaks in the Woodcreek system some years ago. After approximately half of the repairs were made, the project quietly disappeared and was never completed. Aqua Texas also promises not to raise rates for five years. Five years is a long time and things happen. Revenue shortfalls and/or higher operating expenses may cause Aqua Texas to believe they need a rate increase. Again, we remember when Woodcreek protested a rate increase several years ago and sued Aqua Texas. Woodcreek soon learned that they were outlawyered and outspent by Aqua Texas. Even though Woodcreek teamed up with several smaller communities, they did not prevail. Adding insult to injury, Woodcreek and the other communities were stuck with paying Aqua Texas’ legal fees.

A recent financial analysis shows that the City must raise $3 million in order to pay for the transition from collapsing the current project to dealing with Aqua Texas. What do you suppose is the source of these funds? Property tax, anyone? The $3 million will require a contribution of $1,142 from every one of Wimberley’s 2,626 citizens. How does that sound to you?

The four most expensive words in investing are “This time it’s different.” It is rarely or never different. How can the City be so naive to believe that “This time it’s different with Aqua Texas.” Selecting Aqua Texas while the City has no negotiating leverage will insure an unfavorable (disastrous?) deal for the City.

I would strongly urge the City to stay with the current project, which is underway, has been fully vetted, fully permitted, fully financed, and fully funded and provides an affordable solution for the City, and allows the City to control its own destiny. To do anything different is disingenuous and will place the City in a very untenable situation.

Sincerely,

Bob Dussler