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It’s that time of year again, and ballot initiatives are all the rage. There are bound to be several dozen all over the country, but there are two in Colorado in particular that could have a direct impact on water utilities in that state, and perhaps downstream. Although they are still under some legal scrutiny [...]
I will be presenting at the Water and Wastewater Equipment Manufacturers Association’s 103rd annual meeting thisweek in St. Petersburg, Fl. I will be talking about industry trends and opportunities. Here is an advanced copy of the show! Water Industry Trends View more presentations from stepwiseadvisors
We haven’t been blogging much of late. That’s because we have a major site update in store and we are working on getting it all put together for a big launch later this month. Here is a short list of the improvements we have in mind for you: The same great blog content giving you [...]
President Obama’s 2012 budget will include provisions for a national Infrastructure Bank. In comments provided at the US Treasury blog, Treasury Secretary Geithner said that the bank would leverage private money to “…support projects that produce significant returns on our investment.” The structure of the infrastructure bank, based on the blog post, appears to include [...]
Just last year, we saw Indianapolis reach a new public-private partnership involving the sale of the city’s water and sewer utilities to a not-for-profit cooperative. Today there is news that the City of Nashua, located in New Hampshire, is set to acquire 100% of the capital stock of the Pennichuck Corporation in a deal that [...]
Just the other day we discussed a Virginia Supreme Court decision on municipal water rates and the “fairly debatable standard” that led to, in our opinion, a weak justification for the rates charged by the City of Leesburg. Today we have another Virginia example where a lower court has ruled otherwise. In today’s example, the [...]
A recent decision by the Virginia State Supreme Court suggests that municipal utility rates in that state are not required to be held to “normal” standards of reasonableness. The web article for the Leesburg rate decision explains that the laws of Virginia means that the utility need only meet a “fairly debatable standard,” which seems [...]
Jason Mumm, President of StepWise Utility Advisors, has been invited to lecture at the 2nd Annual Water Marketing Conference of the Colorado Law Institute. The event is scheduled for December 9 – 10 at the Ritz-Carlton Bachelor Gulch Hotel in Beaver Creek, CO. Jason will be speaking about financial and ownership models for water utilities [...]
I’ve had the great privilege to work as a consultant in the water utility industry for the last 15 years, all of which from offices in the Denver area. It would have been impossible for me to not have known who Chips Barry was, and I didn’t need to know him closely or personally to [...]
The City of Indianapolis, whose privately operated water system (Veolia has been the private owner/operator for several years) was ever so recently facing a 35% increase in water rates just 6 months after an 11% increase, has even more recently decided to scrap their private ownership model. “With this agreement, I am rejecting private ownership [...]
The latest NY Times article on water infrastructure does a good job of demonstrating the seemingly impossible issues between the great need for reinvestment in water and sewer infrastructure, the reluctance of the government owners of those systems to actually pay for that investment, and the increasing consequences of infrastructure failure. The article focuses on [...]
An ex-employee of JM Eagle files a lawsuit alleging impropriety in the manufacturing of water lines. Over 5 states have already joined this lawsuit. Does this impact your utility?
If you’re a reader of this blog, you will have noted that we often cite news articles showing how utility rates are being increased in different parts of the US. We track these stories because we feel it’s important for our clients, our readers, and our own staff to understand the political dynamics that make [...]
I’m not sure what’s going on in Naples, FL when their water rate consultant is telling the City Council that the City’s water rates are not legally defensible, but we can speculate if only to illustrate a point. There are lots of reasons why utilities should address their rates on an ongoing basis, but legal [...]
City governments have long admired the money making ability of a water or sewer utility. The enterprise funds are not tax based and, after all, they are natural monopolies where the cities could charge nearly anything they wanted. Plundering enterprise funds to shore up budgets elsewhere is an old practice, and it’s one of the [...]
Privatization is thought by many to be a panacea for lowering costs for water and wastewater systems. Yet, here we have again another example of how a private owner/operator, in this case Indiana American (subsidiary of American Water, NYSE: AWK), seeking a very large increase in rates (click here for the news story). We have [...]
The Illinois American water company serving about 10,000 customers in the Chicago area has asked the Illinois Commerce Commission to approve a 30% increase in water rates and a 50% increase in sewer rates. What the protesters probably don’t understand, and what everyone who thinks substituting public ownership of their water/sewer utilities with private (corporate) ownership needs to know is that the private utility owner has a constitutional right to charge rates that will allow it the opportunity to earn a reasonable profit.
We’ve been following the story in Oceanside, CA for several weeks now and were not surprised to awake to today’s headline that the city council rejected the water rate increases that had been proposed by the utility managers (Council Rejects Water, Sewer Rate Increases). As this story has unfolded, we’ve learned a few things: a) [...]
The typical thinking among most utility customers is that if they conserve their water use, they will save money. By extension, they believe also that the utility will save money resulting in lower water rates. The thinking isn’t irrational. After all, one might reasonably think that if the utility provides less of its water service [...]
We often hear how private utility companies can achieve efficiencies in their water and sewer operations that will result in community benefits (like lower water and sewer rates). For a period of time in the US there was an active market where major cities were selling their utility concessions to private corporations. Veolia was one [...]
Utility managers need to focus more effort on managing money if they are to be successful in asset management. Aging infrastructure costs are large and represent a major risk of rate shock for customers. Managing expectations means quantifying these impacts in a financial plan and keeping the asset management plan in line with financial capacity.
Utility managers should understand that you only get one chance to charge new customers connecting to your system for the capital costs of providing them the capacity they need for service. Connection charges (aka. system development fees, impact fees, tap fees, capacity charges, etc.) are the right way to ensure intergenerational equity between existing customers [...]
Many times, elected officials have the wrong ideas about what a water or sewer rate consultant will bring to the table. In this example from Fort Smith, AK we see an elected body that questions why the city would spend so much on the consulting contract. Their rationale for going ahead? The consultant might find [...]
Water and sewer rates sometimes can’t keep pace with the costs of regulatory actions. Small communities in particular are challenged to meet regulatory requirements with a limited number of customers to share the costs. We expect regulatory actions to increase during the current Administration.
Intricate rate designs can be helpful in reaching certain community goals, but elected officials in particular should never underestimate the value of simplicity. In this example from Frankfort, KY (http://bit.ly/11h0OB) we see how customers can become easily confused with their utility bills and how that confusion can increase when multiple utilities are billed together. In [...]
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