Contracted city water meter readers hacked into a computer system and entered false readings that caused the water bills of about 17,800 Austinites to spike in 2017, forcing the city to issue thousands of refunds, according to Austin Energy officials.

Early this year, the city accepted a check for its trouble — for $100,000.

Under a settlement agreement approved in February, the city's former meter reading company, Tribus Services, formerly known as Corix Utilities, agreed to pay the sum without acknowledging any wrongdoing. For its part, Austin agreed not to sue the company for any more money.

BACKGROUND: Frustration mounts as city says there’s no explanation for water spikes

Monica Joyner, an Austin Energy process manager for quality, told members of the Electric Utility Commission in November that a potential settlement would likely be minor compared with what the billing debacle cost the city, because the contract with Corix limited options for recouping funds. Asked last week to elaborate, Andy Perny, a division chief for the city's legal department, said the settlement was “a reasonable compromise.”

“The settlement covered all refunds of costs paid to Corix for the incorrect meter reads," he said in an emailed statement. “It also covered direct costs of printing and postage associated with customer notifications. The City was not able to recover all the labor costs of the investigation … because the likelihood of recovering such indirect damages through a court proceeding is uncertain.”

The issue goes back to September 2017, when scores of Austin residents began reporting unusual spikes in water bills. For months, Austin Energy, which handles billing for both electric and water utilities, insisted its systems were immune to error and only individual water users could be responsible.

But the American-Statesman analyzed the water bills of more than 100 residents and found a clear pattern of abnormally low August water use and abnormally high September use.

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Austin Energy investigated and found that two meter readers had been able to bypass safeguards to log in as administrators and falsify August meter reads on certain meter-reading routes. The low numbers caused September readings to be artificially high, pushing many residents into higher billing tiers. The utility ultimately gave refunds to 7,400 people who were overbilled.

Corix was in the final month of its contract when the breach occurred. Another company, Bermex, already had been selected to take over the $4 million-per-year contract in September 2017.

Tribus CEO Kevin Meagher said in an emailed statement that the company cooperated fully with Austin’s investigation and was determined to find out what happened.

“We worked with Austin Energy for almost 17 years and built a good reputation over that time,” he said. “This was an isolated event, limited to two meter readers in the last month of our contract. To ensure the issues was addressed, we continued to work with Austin Energy and the City after our contract ended.”