City councilman requests more oversight in Vista Ridge project

Council Ron Nirenberg worries risk could be put on taxpayer

SAN ANTONIO – District 8 City Councilman Ron Nirenberg has long questioned the Vista Ridge Pipeline project. He filed a Council Consideration Request Wednesday for a resolution that would allow the City Council the authority to approve certain changes to the contract for the project between SAWS and Abengoa.

His questions surged again this week when Abengoa, the company leading the project, told the San Antonio Water System board of trustees that it will need investors to cover 80 percent of the cost.

Originally, Abengoa planned to have investors fund 49 percent of the Vista Ridge Pipeline, which will pump water from Burleson County to Bexar County.

The Spain-based company filed for pre-insolvency in November 2015, solidifying Abengoa’s struggling financial status.

“We heard all about the risk being shifted away from taxpayers,” Nirenberg said. “If that risk is being shifted back to taxpayers, I have a problem with that.”

READ: Vista Ridge Pipeline company lacks funding for project

SAWS President and CEO Robert Puente and Mayor Ivy Taylor, who serves on the SAWS board, maintain that residents' pockets are protected no matter which investors come on board.

“I understand that we all want to protect the ratepayers, but they are protected in the existing agreement -- the agreement that we all voted on and approved,” Taylor said, referring to her fellow City Council members.

In that agreement, Taylor said the council concurred that the contract between SAWS and Abengoa would not need further council approval as long as the cost of the project did not change or the amount of water the city will receive.

Taylor adds that a rate cap was stipulated in the contract that would prevent SAWS customers from paying ever-increasing amounts to fund the project.

The City Council approved SAWS rate increases last year.  

But Nirenberg’s request to the council states that SAWS is “openly contemplating taking over the construction of the pipeline.”

The councilman argues that would put the risk squarely on the shoulders of the taxpayers, and not just when it comes to cost.

“There are lots of risks. One of the risks is if we don’t get the water. One of the risks is environmental concerns during construction (and) right-of-way issues in being able to secure the land necessary,” Nirenberg said.

RELATED: City Council approves SAWS rate hike

SAWS leaders acknowledge there are risks involved in the project. Taylor also acknowledges there are risks.

“But I think the biggest risk for us is not having an additional supply for our community,” she said.

In a written statement Thursday, SAWS said, "The Vista Ridge Pipeline continues to be a viable project, and SAWS is fully committed to adding this resource to our diversified water portfolio. As any significant water project will face hurdles, this contract was negotiated to ensure San Antonio’s interests are protected.  A component to the contract is the ability for SAWS to take over, as Abengoa was reminded at our Board meeting earlier this week.  However, we would prefer to continue this current arrangement and we will ensure any proposed investor shares SAWS’ commitment to the Project and its long term success."

Taylor added that she felt filing a council consideration request was not a necessary first step.

“Being that I am the liaison to the SAWS board for the City Council, I think we certainly could have had a conversation as a preliminary step in order to determine how we would proceed,” Taylor said.

Four other City Council members signed Nirenberg’s council consideration request, which means it got the support it needs to be discussed further.

Those supporters include District 1 Councilman Roberto Trevino, District 4 Councilman Rey Saldana, District 5 Councilwoman Shirley Gonzales and District 7 Councilman Cris Medina. 

About the Author: