Birmingham Water Works isn’t making money on more than 41% of its treated water

Published: Jul. 14, 2022 at 10:06 AM CDT|Updated: Jul. 15, 2022 at 11:25 AM CDT
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BIRMINGHAM, Ala. (WBRC) - Much of the attention around the Birmingham Water Works in the last few weeks has been from residential customers who haven’t gotten a bill in months, or are suddenly getting big bills covering several months.

“We’re getting promised different things and they’re never coming to, so if there was another option, we would’ve been there months ago.”

But there’s another problem for the utility bubbling just below railroad tracks that run alongside the U.S. Steel facility in Fairfield----a massive leak that sources tell WBRC has been gushing water from broken pipes for years.

Birmingham Water Works isn’t making money on more than 41% of it’s treated water
Birmingham Water Works isn’t making money on more than 41% of it’s treated water(WBRC)

This is untreated raw water that industrial customers like U.S. Steel pay the BWWB to pipe into their facilities to help cool off major industrial machines, but all of that leaking water isn’t helping anyone. In fact, the Birmingham Railway Terminal says it’s starting to degrade the land around these railroad tracks, tracks that CSX trains use everyday.

Asked if he could estimate for how many gallons have been leaking out there for what appears to be several years, BWWB General Manager Michael Johnson said “I have to confirm the leak. We’re aware of that and we’re working on a project to repair that. Where does that repair process stand? So we assess all of our projects, our engineering department looks at all of those, and this is on our list to get replaced.”

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Less than a mile away down the same train line, what looks like a pond is actually more raw water gushing out of busted BWWB pipes.

Birmingham Water Works isn't making money on more than 41% of treated water
Birmingham Water Works isn't making money on more than 41% of treated water(WBRC)

This pond so big you can see it clearly from our WBRC Skytracker drone, and even from Google Streetview cameras.

“So we understand there’s a leak, and we’re working on a project to replace that,” Johnson says. “It is on the railroad tracks so there are quite a few more regulations when it comes to working around railroads that we have to comply with. But we are aware of it, and have a project in place to repair that leak.” Asked if he could give a timeframe on when repairs would happen, Johnson said, ”Not at this point.”

Asked why it’s taking so long to fix that, BWWB Asst. General Manager for Engineering and Maintenance Derrick Murphy said “Again, I’ll be limited on this because we’re talking from a security standpoint. Let me give you an example. Some leaking you can’t just shut off. A 60-inch line you’re going to need certain equipment like a 60-inch valve that may take a year and a half to get back. Some of these industries can’t have any form of downtime, so we can’t cut off, we got to schedule that out. The one you’re talking about is between two active railroads, so there’s other guidelines to go along with that.”

Asked if that meant we’re talking it’s well into next year before that particular leak is even begun to be addressed, Murphy said “Well maybe not. In terms of shutting of---maybe not. It depends on once we do our exploratory digging, we may can repair it quicker, but it’s depending on that.”

If you’re a BWWB customer, you’re not directly paying for this mess, but the system also loses billions of gallons of treated drinking water each year that you are paying for.

The last report the utility made to the state in February estimated it lost almost 31% of the water it treated, mostly to leaks from faulty pipes. For some perspective, a JD Power utility expert we talked to says somewhere around 20% is the industry average.

“What would you say to customers who are already frustrated by billing issues, inflation, frustrated by what they have to pay, we know all the things they’re paying for, and about one out of every three gallons you treat they’re paying for and nobody gets to use?” asked 6 On Your Side Investigator Jonathan Hardison.

“We’ve got a robust pipeline replacement program and we understand we want to treat as little water as we sell,” Johnson replied.

“The customers that may be getting water without paying for it, do you have any estimate on how many customers that is?” Hardison asked.

“No we don’t keep that number,” Johnson said. “We don’t keep it down, it’s such a small amount when you look at our total production.”

But some simple math gives us a pretty good idea, and it’s bigger than the number reported to the state. The system reported last year that it treated about 40.4 billion gallons of drinking water, and told us it billed 23.6 billion gallons. That means 41.5% percent of the water the system treated, it didn’t make money on. If you subtract the 31.7% that it told the state is lost to leaks, that means another almost 10% is going unbilled.

The BWWB says some of the unbilled water loss is due to routine flushing of the water mains or fire hydrants, and “additional seepage inherent to running a water system,” but sources tell WBRC FOX6 News the water loss from either of those is statistically insignificant relative to the overall loss we’re reporting.

“We have roughly 4,000 miles of pipeline from new to old in the system,” explains Murphy, who’s in charge of finding and repairing leaks as well as replacing old pipe. The system budgeted $30 million for that last year, but only spent $22 million of it.

Asked if the $8 million that went unspent could’ve been spent to fix more pipe, Murphy explained the system’s limitations. “You have limitation in equipment. To give you an example: before COVID we had a 4-6 week lead time for getting pipe, now we have a 30-40 week lead time for getting pipe.”

Then there’s the Shades Mountain treatment plant project. The original plan called for a bid of $39 million, then the price tag jumped to around $50 million when it was bid in 2017 and promised as a three-year project. Asked why, five years later, it’s not done, Johnson said “Well at this point, I can give you a written response to that one, but I’m not prepared to talk about that specific project at this point.”

“That project is moving along, we’re near to the end of that, we can’t wait to wrap that up,” Murphy explained.

The BWWB improved their customer satisfaction score in an annual J.D. Power survey for the first time in several years, but still ranks near the bottom both nationally and regionally---and infrastructure was a sore spot.

“We have a real simple question: ‘Does your utility do a good job maintaining infrastructure?’” explains J.D. Power’s Andrew Heath. “And that’s one of those areas where BWWB is scoring lower than most other water utilities.”

These delays and being behind on projects is beginning to get the attention of Water Works board members including chairman Chris Rice, who last week told Murphy and others during a committee meeting, “We’re behind on projects now where we don’t even know where we stand---we don’t know, and we’re trying to drop what we’re behind on to put something else together that we’re gonna be behind on.”

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