The city of Rowlett is backing the efforts of the cities of Garland, Mesquite, Plano and Richardson in their fight against the North Texas Municipal Water District’s (NTMWD) “take-or-pay” system.

In 2016, these four NTMWD member cities joined forces to ask the Public Utility Commission of Texas (PUC) to step in and evaluate the methodology the NTMWD uses to establish its rates.

The cities purchase water through what has come to be known as the “take-or-pay” system. The system uses the year of highest usage to establish how much water to bill the cities for. In the case of the four cities, that rate was set at least 10 years ago, prior to the drought and water conservation.

For the cities of Garland, Mesquite, Plano and Richardson, they hope the PUC will step in and force changes to the system. In order for changes to be made to the NTMWD rate structure, all 13 member cities have to agree to change them. With some cities still setting new minimums and happy with the current system, a unanimous change has not materialized.

Following the decision of these four cities, NTMWD Executive Director Tom Kula issued a statement at the time saying the district recognizes the concerns of Garland, Mesquite, Plano and Richardson, but it must also consider the positions of the other nine member cities – Allen, Farmersville, Forney, Frisco, McKinney, Princeton, Rockwall, Royse City and Wylie.

The four cities remain committed to the NTMWD but want to see a new rate methodology that is fair and encourages water conservation.

On Feb. 7, Rowlett Mayor Tammy Dana-Bashian informed the Public Utility Commission by letter that, as the largest customer city of the NTMWD, Rowlett is supporting the efforts of Garland, Mesquite, Plano and Richardson.

“Together, we are urging the commission to initiate a cost-of-service hearing, providing an opportunity for all of the district’s wholesale water customers to participate, and requesting the commission set just and reasonable rates for the District,” Dana-Bashian stated in the letter.

She noted in the letter that under the compulsory take-or-pay structure, Rowlett has paid nearly $20 million for over 10 billion gallons of water that was not received or used by Rowlett citizens or customers.

“Based on the current cost structure in place by the district, we will continue to be charged every year for hundreds of millions of gallons of water that we do not use,” she stated. “The most common complaint we address with our citizens is the high cost of water compared to surrounding cities, which correlates directly to the take-or-pay cost structure in place by the district for wholesale water. Small communities such as Rowlett have no ability to mitigate the negative impact of the take-or-pay structure due to limited resources. And, we have no choice but to purchase water from the district as we have no feasible alternative.”

A Rowlett resident has created a petition to support a PUC review of the “take-or-pay” contract, and in support of a contract that charges fairly across the entire customer base only for the amount of water used. This petition can be found at Change.org - Support a PUC Review of the NTMWD’s “Take or Pay” Contract.

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