Thames Water has been hit with a £260,000 bill from authorities who responded to Oxford's Normandy Crescent flooding crisis.
Oxfordshire county and Oxford city councils have billed the utility company for huge costs incurred during the Cowley incident in January, when 24 homes were flooded after a pipe cracked.
But the cost could spiral further after individuals file their claims.
An estimated one million litres of water gushed through homes when the 24-inch diameter pipe burst in the early hours of January 25.
Scores of firefighters helped evacuate residents - some of whom were rescued from waist-high water in their council houses.
Oxford City Council was left with a £225,000 clean-up bill, while the county council was left £35,000 worse off and has billed Thames Water for non-emergency costs.
Last night it emerged the battle to reclaim costs could end up in court but both councils had the backing of tenants.
John Kelly, the county council's emergency planning officer, confirmed a claim for £35,000 had been submitted, but added: "It could be that legal proceedings will occur, so we cannot say any more at this stage."
Pensioners Bill and June Hillier were carried from their home by firefighters.
Mrs Hillier, 75, said: "I agree it was Thames Water's fault and the county council should be recovering the cost. It really affected the community and they should be held to account."
Neighbour Joseph Pearson, 76, added: " I believe it was their fault and I back the council."
Sixty firemen worked through the night to rescue residents.
Graham Bourtoncorr, head of Oxford City Homes, said: "We have submitted a claim to cover the costs incurred for damage to 14 properties in Normandy Crescent caused by their burst water main. This is in the region of £225,000."
Thames Water spokesman Hilary Bennett said: "At the time of the burst water main Thames Water admitted liability for damage to property, refurbishment costs and any expenses incurred by our customers."
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