An Austin Water program manager resigned last summer after an investigation by the City Auditor’s Office found he improperly used his city credit card to pay contractors tens of thousands of dollars for work on private property and other unauthorized services.
The auditor’s report, released Wednesday, details how hydrogeologist Nico Hauwert, a longtime manager in Austin Water’s Wildland Conservation Division, used his city purchasing card to make about $78,000 in payments to contractors between 2019 and 2023 — including $67,000 for work on private land in the Roy Creek and Little Bee Creek areas and another $5,700 for water testing outside of city preserves. The auditor found that some of those payments were split into smaller transactions to avoid triggering stricter procurement requirements.
The findings stemmed from internal complaints within Austin Water and were first discussed publicly Oct. 15, when the City Auditor’s Integrity Unit briefed the City Council’s Audit and Finance Committee. The newly released report provides a fuller picture of the alleged misuse of funds, concluding that Hauwert’s actions violated city policies and “constituted waste of city resources.”
Auditors also found that Hauwert made roughly $9,000 in unauthorized expenditures for services that could have been performed by Austin Water staff. The report says those transactions sidestepped purchasing rules and lacked proper approvals.
Hauwert was placed on administrative leave last year amid a separate human resources investigation and resigned in July 2024, according to the report. In a written response included in the audit, Hauwert called the investigation “punitive retribution” and argued that his spending decisions were made to keep vital conservation work moving forward despite bureaucratic delays and staff shortages.
“I tried the best that I could to serve the public good with the resources that were available,” Hauwert wrote. He said that projects like cave excavation and groundwater testing were authorized parts of his division’s conservation mission and that lengthy procurement processes had stalled progress for years.
In an interview with the American-Statesman, Hauwert maintained that the credit card expenditures were approved and necessary to meet federal habitat-protection requirements. He accused Austin Water leadership of retaliating against him after he raised concerns about the city’s environmental compliance, saying he was labeled “an activist in contradicting the city” after contacting the mayor directly about disputed environmental policies.
Hauwert began managing the Balcones Canyonland Preserve program in 2016, overseeing efforts to protect habitat for seven endangered species and more than two dozen species of concern. He has since retired and now runs a consulting firm that advises conservation groups such as Save Our Springs on groundwater management and land use.
In response to the audit, Austin Water said it is tightening oversight of departmental purchasing cards and contractor payments. The City Auditor’s Office has also launched a broader review of citywide credit card use, with results expected by early next year.
Chief of Investigations Brian Molloy told the Statesman the Hauwert case prompted auditors to rethink how they detect improper spending. “How could we have caught this guy? What sort of tests could we have run?” Molloy said. “Once we identified a few unique things, we basically pulled all the pro card records and ran those tests until we got a good sample of suspicious-looking purchases.”
This is not the first time Austin Water has faced scrutiny from city auditors. Last year, a separate investigation found that former Chief Information Officer David Johnson misused city resources to access confidential emails; he resigned during that probe.
The new report on Hauwert’s spending adds to broader questions about spending oversight and accountability in city government, following Statesman reporting that revealed questionable discretionary spending among Austin’s top officials — including luxury travel and high-end meals billed to taxpayers.