Birmingham, Alabama, October 14, 2025
News Summary
In a recent board meeting, the Central Alabama Water Board discussed a budget proposal for 2026 that may not include a rate increase for customers for the first time since 2021. Key measures include replacing meters for accuracy, cutting chemical expenses by $1.5 million, and reducing labor costs by $2 million. Mayor Woodfin has requested conditions for his support on a potential $183 million funding to replace lead pipes, amid ongoing discussions and legal challenges.
Birmingham, Alabama – Customers with the Central Alabama Water Board may not face a rate increase for the first time since 2021, according to discussions during a board meeting on Monday regarding the early plans for the 2026 budget. This proposed budget introduces several cost-cutting measures aimed at preventing a rate hike.
The key cost-cutting measures outlined in the proposed budget include the replacement of meters to improve accuracy, a reduction of chemical expenses by approximately $1.5 million, and a decrease in projected labor costs by roughly $2 million. Additionally, the budget dictates no pay increases or merit increases for employees, with the goal of maintaining current budget levels to save customers money.
While the board plans to allocate $165,000 for a recruiter to assist in finding a new Chief Executive Officer, the rebranding of the Birmingham Water Works Board to Central Alabama Water Works will not be included in the budget. General Manager Mac Underwood emphasized that staffing adjustments are critical for cost management, noting that they will not fill about 42 positions that are currently vacant.
As discussions around the budget continue, it is essential to note that Birmingham’s regional water system could potentially gain over $183 million for replacing old lead pipes and other infrastructure projects, contingent upon the support of Mayor Randall Woodfin. Mayor Woodfin has requested several conditions, including a guarantee against rate hikes, the establishment of an in-house law department, and goals for minority participation in construction projects in exchange for his support.
Current board members, primarily appointed by Republican authorities, are engaged in discussions with Mayor Woodfin regarding his terms for supporting the loan application. However, these conversations occur against the backdrop of a pending federal lawsuit from the city against the utility related to changes enacted by state legislation. General Manager Underwood has noted that the Alabama Drinking Water Authority seeks assurances from the city concerning the terms of the loan agreement in light of the ongoing lawsuit.
Mayor Woodfin’s proposal for an in-house legal department corresponds with the suggestion of board member Jarvis Patton, but has faced resistance from the majority of the board. The water works has expended $1.7 million on legal fees for outside counsel in the last fiscal year. The Birmingham City Council has approved resolutions aimed at preserving local oversight of the Birmingham Water Works, particularly in light of the recently passed SB 330 legislation, which alters the composition of the Birmingham Water Works Board into a regional board, causing concerns about representation and governance. The city council also voted to hire attorney Calvin Grigsby for civil litigation related to SB 330, at an expense of up to $95,000.
Mayor Woodfin has criticized the prompt passage and the implications of SB 330, terming it unconstitutional. Meanwhile, a new logo and brand identity for Central Alabama Water has been selected, featuring a five-segment water drop to represent the five counties served by the utility.
Summary of Key Features
| Feature | Details |
|---|---|
| No Rate Increase | First time since 2021 proposed in the 2026 budget. |
| Cost-Cutting Measures | Approx. $1.5 million in chemical expense cuts; $2 million in labor cost reductions; new meter installations. |
| No Pay Increases | No salary or merit increases for employees. |
| Infrastructure Funding | Potential $183 million for replacing lead pipes pending Mayor’s approval. |
| Board and Legal Updates | The proposed in-house legal department faces resistance; $1.7 million spent on outside counsel. |
FAQ
Will there be a rate increase for the Central Alabama Water Board in 2026?
Customers with the Central Alabama Water Board may not face a rate increase for the first time since 2021.
What are the key cost-cutting measures proposed in the 2026 budget?
Key cost-cutting measures include replacement of meters to improve accuracy, reduction of chemical expenses by approximately $1.5 million, and a decrease in projected labor costs by roughly $2 million.
How much funding could the regional water system gain for infrastructure projects?
Birmingham’s regional water system could gain over $183 million for replacing old lead pipes and other infrastructure projects.
What conditions has Mayor Randall Woodfin requested for his support?
Mayor Woodfin requests conditions including a guarantee against rate hikes, the establishment of an in-house law department, and goals for minority participation in construction projects.
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Additional Resources
- WBRC: Central Alabama Water Board Works to Avoid Rate Increase for 2026 Budget
- AL.com: Birmingham Mayor Issues Conditions to Water Board for $183 Million Loan
- ABC3340: Birmingham Sues Alabama Over New Water Board Law
- Birmingham Times: Central Alabama Water Unveils New Logo
- Alabama Reflector: Alabama House Passes Bill Overhauling Birmingham Water Works Board
- Wikipedia: Water Supply and Sanitation in the United States
- Encyclopedia Britannica: Water Supply
- Google Search: Central Alabama Water Board
- Google Scholar: Birmingham Water Works Board
- Google News: Birmingham Water Issues
Author: STAFF HERE BIRMINGHAM WRITER
The BIRMINGHAM STAFF WRITER represents the experienced team at HEREBirmingham.com, your go-to source for actionable local news and information in Birmingham, Jefferson County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Sidewalk Film Festival, Sloss Music & Arts Festival, Magic City Classic, and civil rights commemorations. Our coverage extends to key organizations like the Birmingham Business Alliance and the Birmingham Civil Rights Institute, plus leading businesses in healthcare, finance, and manufacturing that power the local economy such as UAB Medicine, Regions Bank, and Encompass Health. As part of the broader HERE network, including HEREHuntsville.com, we provide comprehensive, credible insights into Alabama's dynamic landscape.
