San Diego Water Department staff made slide-show and video presentations illustrating the city's aging water infrastructure, like the corroded pipes above, to more than 60 community organizations. The water department manager attended most of the presentations to explain the issues, listen to input, and answer questions. Photo: San Diego Water Department
The budgeting process takes three to four months, and includes identifying needed programs, such as valve and hydrant maintenance, and then developing a budget for each. Because each proposed dollar amount is attached to a need, there's no “miscellaneous” line in budget proposals. The board of directors then reviews the budget and corresponding rate requests.
Using this method, Fern persuaded the board to adopt an overall 23% sewer and water rate increase last year and a 19% increase this year.GET A THIRD-PARTY ENDORSEMENT
Another powerful way to justify rate increases is to partner with a regulatory agency that can go in front of the board and say, ‘yes, this really needs to be done.' Or, see the next item.CONSULT AN EXPERT
By bringing in Raftelis Financial Consultants Inc. to review costs and suggest strategies for improvements over the course of three years, Randy Brown, director of the Pompano Beach (Fla.) Utilities Department, says he received 100% board approval for increases in water, wastewater, and reuse rates. The increases include:
- Water: 0% (2008), 3% (2009), 3% (2010)
- Wastewater: 6% (2008), 6.5% (2009), 6.5% (2010)
- Reuse: 11% (2008), 10% (2009), 9.5% (2010)
EDUCATE ELECTED OFFICIALS
It's not just the public that utilities need to educate — explain to officials why money should be spent now to maintain expensive public infrastructure investments so they won't have to ask taxpayers for more money later to completely replace those assets.
Fern works to educate the Albemarle County Service Authority's board of directors about what is required to maintain the financial, engineering, and maintenance aspects of the agency's water and wastewater systems. “We also show them the value of receiving drinking water and wastewater services from ACSA as compared to [the costs of] other common needs, such as bottled water, milk, and gas,” he says. “Even with a rate increase, people don't realize how little they spend for tap water, and they take it for granted.”
Brown offers educational workshops to Pompano Beach board members. Other water departments offer facility tours.
There's no foolproof way to guarantee a proposed rate increase will fly. But by educating stakeholders about infrastructure and water quality needs, providing the details on why an increase is essential, and bringing in third parties to endorse the proposal, you can help make it easier for decision-makers to make the right decision for your utility.Getting educated
Public and elected officials aren't the only stakeholders who require enlightenment when considering higher utility rates. The most successful campaigns are based on how well utility managers understand what motivates consumers.
In 1997 the San Diego Water Department and community relations firm Katz & Associates Inc. joined forces to measure public perception of the city's water system and potential rate increases. What the two focus groups taught them may surprise you:
- Most San Diegans realized that the city imported most of its drinking water supply, but didn't know how that water got to their homes.
- Even when showed photographs of severely corroded and burst pipes, residents didn't believe those problems would affect the reliability of their water service.
- San Diegans had a significant mistrust of government, including the city's water department.
- Even so, they were concerned about water quality, and were willing to pay higher rates to ensure the water was safe to drink.
To view the San Diego Water Department's case study on public outreach and the city's capital improvement program, visit the “article links” page under “resources” at www.pwmag.com.