After a Year With Failing Well, Water Solution In Sight For Spicewood Beach

Nearly a year ago, the groundwater well serving the small lakeside community of Spicewood Beach, about 40 miles outside of Austin, began to fail. Ever since, the locals there, mostly retirees, have gotten their water trucked in several times a day to keep the taps flowing. As the levels of Lake Travis have fallen during the multi-year drought, the alluvial well that provides for the community has dropped so much that it no longer fully functions. “If the lakes come up, we get our wells back,” resident Wanda Watson told us last year. “If they don’t come up, we have no water.”

For residents, the distinction of being the first Texas community to run out of water during the drought has been a troubling one. People are moving away, and property values have dropped significantly, almost in tandem with lake levels. “There’s a lot of homes for sale out here right now,” Kathy Mull, who’s lived there ten years, tells StateImpact Texas. “We are definitely considering moving ourselves right now. There’s a lot of places that have come up for sale, but they’re not selling. Who’s gonna buy out here with no water?”

But for the first time since the well began to fail, an end may be in sight.

On Wednesday, the board of the Lower Colorado River Authority (LCRA) will vote on a $1.2 million project to build a surface water treatment plant to serve the community. It should work even if the lakes go lower, and provide ample water. The open question is who will ultimately bear that cost.

Photo by Jeff Heimsath/StateImpact Texas

Longtime resident L.J. Honeycutt said last year that his plan was to "drink less water and drink more beer."

The water for Spicewood Beach is currently owned by the LCRA, which is in the process of selling it and several other water systems in the region to the Canadian company Corix. The $1.2 million cost of the new water treatment plant, put up initially by the LCRA, will be part of the final sale price to Corix, with $275,000 of the cost potentially offset by a federal development grant.

The new system will provide 475,000 gallons of water per day to the community, or about 432 gallons per person, per day. (Which should be ample, as the average family of four uses 400 gallons per day.)

While a steady supply of water is welcome news to the residents of Spicewood Beach, some aren’t happy that they may end up footing the bill. At $1.2 million, the cost of the new treatment plant works out to about $2,400 per household, given that there are 500 water meters in the community.

“That’s been our main concern ever since all this started,” resident Kathy Mull says. “And it’s been asked in every meeting we’ve had with them [the LCRA]. And they’ve told us they can’t tell us what Corix will do when they take it over. But we know it’s coming,” she says with a laugh.

Jack Toohey, a representative for Corix, says that “ultimately, any cost of any improvement will go into the rate base calculations, and that will go in front of the Texas Commission on Environmental Quality (TCEQ). Those calculations will have to be done.” Toohey says the sale of the water system (along with 17 others) by the LCRA to the Canadian Company is still pending approval by the TCEQ. One that’s finalized, any change in customers’ water rates will also have to be approved by the TCEQ.

If the LCRA board approves the plan tomorrow, they expect it will take four to six months to complete, and will be finished before the sale of the water system is finalized and transferred to Corix.

Johnny Burkett is on the board of the Property Owners Association for Eagle Bluff, which has about 35 landowners also served by the Spicewood Beach system. He’s lived there 12 years.

“I didn’t have a clue this [water treatment plant project] was going on,” he says. Burkett maintains that the LCRA didn’t tell the Property Owners Association of the new treatment plant. “When Corix first took over [the Spicewood Beach water system], we had a meeting. They said it wouldn’t affect the water rates.”

The water rates from private companies for small communities in rural parts of the state have been getting more attention in recent years. “Tales of double-or even triple-digit rate hikes abound,” Kate Galbraith of the Texas Tribune reported in November. “Ratepayers say that they are hamstrung in efforts to fight the increases because the water companies, which have monopoly status, have far more money. Also, the companies’ cost of litigating rate-increase complaints ultimately gets charged to ratepayers.”

It’s possible that the current state legislature will take action to move oversight of those rates to a different state agency, the Public Utility Commission, which sets rates for electricity transmission and telecommunication utilities. That change on oversight for water rates could be part of a Sunset Bill for the Public Utility Commission this session.

“I don’t think the residents should pay for [the new water treatment plant], I think the LCRA should,” resident Burkett says. “They’re responsible for the reason we’re in the situation we’re in now.”

For now, customers in Spicewood Beach will likely continue paying their current rates for water. “The LCRA is not anticipating changing its rates before the sale to Corix is complete,” LCRA spokesperson Clara Tuma tells StateImpact Texas. “We expect the sale to close by the end of the year.” Corix has taken over operations of the water system as the sale is pending.

“I don’t like it,” Spicewood Beach resident Kathy Mull says. “They sold our water out from under us. And we shouldn’t have to pay the consequences of it. We’ve been without water for over a year out here. It’s just not right.”

Photo by Terrence Henry/StateImpact Texas

What was once a marina is now a cliff overlooking a dry riverbed in Spicewood Beach.

Mull is referring to the fact that before the Spicewood Beach well began to fail, the LCRA sold water from it to private companies to truck out of town. In 2011, 1.3 million gallons of water were sold to private water haulers from the Spicewood Beach system, a significant portion of the community’s water — four percent of their water needs for the year.

“They had trucks coming in, hooking up to the fire hydrants, sucking water out of our well, and selling it to other people, [for] cheaper than what we was paying for it,” Eagle Bluff resident Johnny Burkett says. “The whole time they was just sucking us dry.”

Since the well began to fail, the LCRA has had to cover the high cost of trucking water in, totaling over $400,000. The LCRA says they will continue to do so until the new water treatment plant is operational.

And the LCRA has limited residents water use, telling them to “think about how you are using every drop of water,” with a limit of 2,000 gallons per household a month. “If you go over that, you get a warning,” resident Mull says. “And after that, you get a $500 fine, and it keeps going up from there.” The community has been in Stage 4 ‘Emergency’ water restrictions for over a year.

The community looks at the new water treatment plant with mixed emotions. On the one hand, some residents feel it’s not their fault they don’t have the water they need, and they’ll have to bear the cost of the new plant and suffer from lower property values in the meantime. On the other hand, a stable supply water can’t come soon enough.

“Our value on our places, [the LCRA] ruined,” Mull says. “No one wants to live where there’s no water.”