DALLAS – The Internal Revenue Service is examining the tax-exempt status of $89 million of bonds issued by the San Antonio Water System, according
The IRS called the audit "routine" in a letter to SAWS Chief Financial Officer Doug Evanson.
SAWS bond counsel Clayton Binford of the firm Norton Rose Fulbright said that the city-owned water utility "has not been audited in the last 10 years and may not ever have been."
Binford said the initial phase of routine audits generally take less than three months and can continue if the IRS requires more information. In his letter to Evanson, IRS agent Kurt J. Ochsner said the audit could require a visit to SAWS facilities.
The bonds under examination were placed in 2009 with the Texas Water Development Board, which pools debt from Texas public water utilities and then issues bonds in its own name to achieve a lower interest rate.
Binford said the bonds were issued for common water system improvements.
SAWS, which serves San Antonio and Bexar County, is one of the largest water utilities in the nation and one of the top debt issuers in Texas.
