Central Alabama Water’s board of directors is considering the biggest rate increase in a decade, and its customer service phone lines have been overwhelmed for more than a month, according to information shared during a special-called meeting of the utility’s board of directors Friday.
Call volumes doubled to more than 4,000 per day after CAW hurriedly transitioned to a new payment vendor over Labor Day weekend, said Brian Lewis, CAW’s chief people officer. That’s led to wait times of more than an hour as customers call to find out the new payment website and their account numbers so they can pay their bills, he said.
“It has led to wait times that are intolerable and disappointing,” Lewis said.
The utility had planned a three-to-four-month transition period, but the change-over period shrank to three to four weeks once the old vendor learned it would be dropped, Lewis said. CAW also lost some customer data the old vendor withheld, he said.
Call volumes dipped below 4,000 per day just last week.
Friday’s meeting was supposed to be about the utility’s 2027 budget and rates, but discussion surrounding call-wait times began when board member Jarvis Patton Sr. brought up being 158th in line when he called customer service recently.
Lewis began his response with a joke: “Director Patton, I'd say we're very popular.”
Customer complaints have plagued the utility for years and are one reason state legislators gave for passing a bill in May 2025 that restructured the utility, leading to the new board and senior management team currently in place. CAW’s proposed 2027 budget includes $3.5 million to investigate and find solutions to customer service issues.
Customers reported up to 100 callers being ahead of them as early as April of this year.
When Patton pressed Lewis about when the long wait times began, he didn’t give a direct answer but said CAW has been dealing with other “headwinds,” including an outdated customer information system that makes it difficult for customer service representatives to access simple data.
“Until we can modernize the CIS [customer information system], the customer service reps have their hands tied a little bit,” unlike local reps in the power and gas industry, Lewis said. “When those folks answer the phone, they know who's calling, and they already know what they're calling about and they can see the customers' data on their screen.”
He said an updated system should be operating in six to nine months.
CAW conducted a mass layoff of almost a quarter of its staff in March, and the utility said in a press release at the time that all departments were affected. At a meeting earlier this month, the board approved an agreement with a temporary staffing agency to increase its number of customer services reps.
“The reduction in workforce did not help the problem,” Patton said at Friday’s meeting.
CAW Chief Executive Officer Jeffrey Thompson replied that the utility now has more people working in customer service than it did before the mass layoff. “But they are temp employees,” he said.
“In transitioning from our old payment system to the new payment system, the goal was to reduce the expenses to our customers, and so we were going to realize an immediate $400,000 savings by transitioning to the new company,” Thompson continued.
He also said one of CAW’s goals is to move customers to paperless billing, which could reduce the $1.2 million the utility currently pays the U.S. Postal Service.
6.4% rate increase on the table
While the proposed 2027 budget is roughly flat compared to an austere 2026 budget, CAW senior managers are calling for a rate increase of 6.4% next year.
After multiple budget-related presentations during the meeting, the board was preparing to vote on the increase when members including David Standrich said they didn’t want to rush into a decision.
“There's been a lot presented, a whole lot of information that I appreciate,” Standrich said. “I really would request that we take a little more time on this issue. This is a big issue. This is big to a lot of people.”
The increase would add up to $4.85 per month to most residential customers’ bills. That’s on top of a rate-structure change the board recommended earlier this month. That change would add up to $4.90 per month for those customers.
Representatives of the utility’s financial advisor and consulting engineer said they recommend the rate increase to address aging infrastructure, to restart a project to automate meter reading and to fund a reserve account CAW especially needs because it currently can’t borrow money through the bond market.
“If we don't do a rate increase in 2027, it'll put additional pressure on future rate increases,” said Mihaela Coopersmith, a senior manager with financial advisor Raftelis.
The new board didn’t increase rates for 2026, and board members have repeatedly said avoiding rate hikes is a priority. Frequent rate increases were another reason lawmakers gave for restructuring the utility.
“Last year we said we're not going to raise rates, we're not going to raise rates,” board member Bill Morris said Friday. “But next year we're just going to double rates, based on the CPI, and that stinks. I'm just going to tell it like it is.”
He meant doubling the typical rate increase, based on the Consumer Price Index, which measures the average change in prices urban consumers pay for goods and services.
For most of the past 12 years, the utility has increased rates by about 3% to 5% annually.
Patton asked why a solution couldn’t be found to avoid raising rates for senior citizens and others struggling financially.
“There’s got to be other ways that we can find a way to do this without hurting the elderly and the people who can least afford this,” he said.
Thompson said the change is a modest increase.
The board is set to decide on the rate increase at its November meeting.
