Central Alabama Water: Losing Billions, Raising Rates

0:00On March 12th, here's the latest out of Birmingham. A new public filing from Central Alabama Water reveals serious problems over the past two decades. The utility loses 53% of the water it treats before it reaches customers. That's 24 billion gallons gone. Residential bills for standard monthly use have jumped 354% since 2001 from $11 to nearly 50. Dollars, while inflation only rose 79%. Operating costs, telling even tougher story. Total expenses excluding depreciation doubled inflation's pace, climbing from $44 million to $148 million by 2024. Administrative costs alone surge nearly 70% in just the last three years, and water used by customers actually dropped 26%. Even as the customer base grew 4%. These trends explain why state lawmakers converted the old Birmingham water works board into Central Alabama water last May through new legislation.

1:01Officials pointed to management issues and sky high rates hurting residents as the main reasons for the change. The filing marks the first big financial update since that shift, showing operating margins shrinking from 49% in 2019 to 35% now. Utility leaders say fixing these long-term issues will take time to deliver better service. Meanwhile, three lawsuits are challenging the new setup. Birmingham is in federal court, claiming the law is unconstitutional while former board members and executives sue over rights violations and firings. All filed earlier this year. This episode is proudly sponsored by our partner. When you need a moment alone, just lay back and listen, S-O-L-I, solelypillow.com.