Financial Condition of Water Company – Excellent

The water company Board received a really insightful report from NewGen Strategies at its Aug. 27 Board meeting. NewGen helps utility companies like ours understand their financial health. You can view their report here.

In my next few posts, I will offer some observations about their report.

For example, the table below tracks “Days Cash on Hand.” DCOH is money our company had available to meet short-term operating expenses as if not another dollar would come in from customers. Most companies try to have 90 days of cash on hand.

The company had no problem maintaining much more than 90 days of cash on hand in 2017 and 2018.

But in 2019 the DCOH fell to 79 days. Last year was extraordinary in these respects:

  1. NEW LAWSUIT AGAINST WOWSC. The corporation had to defend itself from a new lawsuit, even though the previous lawsuit (filed by the same plaintiffs) had been resolved in the company’s favor. The Texas Supreme Court finally dismissed their last appeal in 2020.
  2. PUBLIC INFORMATION ACT REQUESTS. We also incurred legal expenses related to fulfilling 46 Public Information Act requests, most from the allies of plaintiffs and the plaintiffs themselves.
  3. NEW GENERATOR. After attempting to buy generators in previous years, the company finally purchased one in order to comply with regulations.

At least by this measure, the volunteer Boards of the water company have done a good, conservative job of cash management for regular operations.

As a side note, the Supreme Court brought the first “TOMA” case to final conclusion on February 14, 2020 — St. Valentine’s Day — in favor of the corporation. St. Valentine is remembered for miraculously healing, on the day of his execution, his jailer’s blind daughter and leaving a note for her, signed “Your Valentine.” We should pray for St. Valentine’s intercession on behalf of our neighborhood, so that those who are blind may see.

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