COSA Budget Cites $7.8 million Water Fund Balance as of July 31

City Council examined the Water Fund in a special budget meeting on August 14.   Finance Director Tina Diershke mentioned the need to grow the water fund balance to a certain number of days revenue but never shared the Water Enterprise Fund Balance, over $7.8 million as of the end of July.

Council could remember Finance Director Dierschke's representation of Water Fund Balance as of 9-30-18 as a mere $3.5 million.  The 2017-18 budget shows a beginning fund balance of $6.1 million.  That's a $2.5 million difference.

Mayor Gunter tried to get a picture of the current water fund balance with direct questions on the number of days and amount.  Dierschke would only give the adjusted budget fund balance of 62 days.  She did not give an actual fund balance figure in days or dollars.

City staff can compare budget to budget but it has accounting documents that show actual figures.    The Water Enterprise Fund is holding enough cash to cover 109 days of water enterprise expenditures.  Council should be astute enough to recognize staff's sleight of hand.

City Council eliminated the twice a year rebate discussion requirement in April of this year.  That may well have been a mistake.

Update 9-25-18:  As of 8-31-18 the Water Enterprise Fund balance stood at $9,369,008.  That's nearly double the last 75 day fund balance goal shared with City Council in November 2017.

Update 8-25-19:  City Council held a budget session on major funds, including water, in early August. Once again staff avoided sharing current fund balances which now total over $31 million.

MedHab Back on City Council Agenda

For the first time in five years City Council will take up MedHab's economic development agreement with the City of San Angelo.  The item is slated for Executive Session.  In return for a $3.6 million economic development package MedHab promised to provide up to 227 jobs within six years.  Over two years ago MedHab President Johnny Ross reported the company hit a key milestone for ramping us San Angelo employment.

The contract is due to expire on January 1, 2019.  Will the city ask for early cancellation, like the Mesquite Solar Project announced to great fanfare in 2014?

I'll venture the Development Corporation Board is itching to do something with money reserved for MedHab.  Will they give it back to nonperforming MedHab?

Update 9-2-18:  MedHab is pursuing a $3 million equity capital raise and already sold over $900,000 of new equity, according to an 8-20-18 SEC filing. 

Vendor Warned City of Click2Gov Problems 2 Months Ago

The City of San Angelo issued a statement on online water payments on August 17, 2018.  A followup press release on 8-20 stated:

Credit card information for water customers who made payments in person and automatically online may have been breached in addition to those who made individual payments online.

Another press release update 8-21 added:

“We know this breach has caused a great deal of inconvenience, and for that we are truly sorry,” Water Utilities Director Allison Strube said. “Since learning of this issue Friday, the City has worked diligently with our vendor to provide an additional layer of protection for our customers. We are continuing the process to learn how many customers might have been impacted and over what timeframe.” The City received a concern Friday that online water bill payments seemed to have led to illicit activity on customers’ credit card accounts.

The company reported security issues in October 2017.  On June 15, 2018 Superion gave an update on problems with its payment software system:

Upon learning of the activity, we proactively notified all Click2Gov customers. Additionally, Superion launched an investigation and engaged a forensic investigator to assess what happened and determine appropriate remediation steps.

Throughout our investigation with the third-party forensic team, we have kept in direct contact with every Click2Gov customer to assist in the resolution of this issue, informing them of our findings via email, phone calls, and one-on-one working sessions. We assisted many customers with analyzing their Click2Gov environment and provided them with best-practice guidance to assist them in securing their servers and networks.

Neighboring city Midland, Texas reported breaches with its payment system on June 27, 2018.

The city of Midland, Texas, on Monday reported a potential security breach of the utility billing online payment platform, administered by Superion. The city reports learning of the possible breach on Friday. Superion’s Click2Gov function is the payment server used to make online payments for utilities. The security breach, according to the city, affected users who made one-time, online payments between December 2017 and June 2018.  

San Angelo City officials are working to find the extent of the breach.   The time frame for the breach will be interesting to learn in light of this timeline.

Update 11-13-19:  The city is concerned it may have another breach of its water bill payment system.  It issued a press release today on the matter.

Update 11-14-19:  The Standard Times reported the city plans to switch water billing vendors.

Six Year Anniversary of MedHab Deal

Six years ago San Angelo's City Council inked an economic agreement deal with MedHab.  It can be canceled January 1, 2019.  That's three months and ten days away. 

San Angelo Solar Farm Fizzles Out

Four years after approving the initial lease for San Angelo's first solar farm the project is dead.  City Council will pronounce the deal after OE Renewables defaulted on their obligations and ignored the city's inquiries.  Former Mayor Dwain Morrison said this deal would "make the city a lot of money."  That hasn't and won't happen.

Update 8-20-18:  San Angelo Live reported on this development.

City Council Goes After More 1115 Waiver Federal Funding

December 4, 2012 was the last time staff presented information on the City's Medicare Section 1115 Waiver grant funding to City Council.  Staff could've given Council an update in today's meeting but the item started on the Consent agenda.  Any member of City Council could've pulled the item from Consent to Regular agenda.  None did.

The City currently holds $441,000 to $620,000 in excess federal funding.  That's 3.5 to 5.4 years of 1115 Waiver funding.  Both numbers come from city documents.  A public information request produced the $441,000 number while the City's Bluebook documents show a $620,000 surplus since grant inception.

City Council approved seeking more federal funding beginning with fiscal year 2017-2018.  Health Services comprise 0.31% of the City's operating budget for 2018-19.  That's minuscule.   An ethical city council would ensure a need exists to seek additional state/federal funding.  There was no discussion, just silence. 

Update 8-13-18:  The City is seeking another $500,000 in funding, even as it sits on excess federal/state funds of $441,000 to $620,000.  The application for more money does not require participants to expend current excess grant funds prior to receiving new Medicare 1115 Waiver funding. 

Update 3-27-26:  The City has $642,335 in 1115 Waiver funds as of a March 9, 2026 financial report.  It is only using these funds for rent.  City Council approved a new lease with Shannon Medical Center in February.  There was no mention of the 1115 Waiver funds as the facility lease was on the Consent Agenda and no Councilmember pulled it for discussion.in their last meeting on March 3rd.

City Wants More Federal Money for STD Clinic

As of 6-30-18 the City of San Angelo reported an unspent $411,491 Medicare Section 1115 Waiver grant funds out of an initial award of $960,000.  That $411,491 is enough to fund 100% of the STD clinic's expenses for 3.5 years.

The City's Bluebook documents reveal an even bigger surplus.  Out of $952,413 received the city spent just $331,657, leaving an excess of $620,756 as of 6-30-18.  That's 5.4 years of 100% federal funding of STD clinic operations.

City Council will consider staff's recommendation for more federal/state funding in their Tuesday meeting.  Staff has not presented any information to City Council on the grant since 12-4-2012.  As the item is on the consent agenda that may remain in place.

In March staff did not inform Council of this substantial surplus when it raised lab fees for patients to cover costs.  Federal money was intended to keep health care accessible and affordable for at risk populations. Staff and Council ignored the significant surplus in March and will likely do so again on Tuesday. 

Update 3-27-26:  The City has $642,335 in 1115 Waiver funds as of a March 9, 2026 financial report.  It is only using these funds for rent.  City Council approved a new lease with Shannon Medical Center in February.  There was no mention of the 1115 Waiver funds as the facility lease was on the Consent Agenda and no Councilmember pulled it for discussion.in their last meeting on March 3rd.