Egg Harbor City Ratepayers Won’t Benefit from Water/Sewer Sale in the Long Run

Posted on: September 10th, 2020 by eric

            Egg Harbor City (EHC) is selling its tiny water and sewer system to a corporate utility for an eye-popping $21.8 million, largesse being underwritten by the rest of the corporation’s two million New Jersey customers. What goes around comes around, though. EHC ratepayers will help underwrite the cost of the next acquisition, and the one after that, and the one after that. 

 

 

 

            According to a press report, the EHC council voted unanimously on Aug. 13 to relinquish ownership to New Jersey American Water, a subsidiary of the multi-state corporation, American Water Works Company, Inc. (AWK). The people of EHC will join the estimated 15 million people in 46 states who are customers of the corporate family. NJAW is permitted to pass the cost of each and every acquisition along to its customers across the state, even though the acquisitions will not benefit them in any meaningful way.
            EHC/NJAW deal is being completed under a misleadingly named law called the “Water Infrastructure Protection Act” (WIPA) passed by a Legislature controlled by Democrats in 2015 and signed by Gov. Chris Christie. The name is misleading because the law does not protect infrastructure nor does it protect ratepayers. At a time when affordability is a bigger issue than ever, WIPA-type deals are especially misguided.
             Big Water has successfully lobbied for WIPA-type legislation, so-called “fair market value” (FMV) laws, in many states including Illinois, Pennsylvania, and California. Connecticut and Kentucky have resisted FMV laws thus far. FMV laws encourage “quick fix” transactions (such as the one in EHC) that in the long run are sure to inflate water/sewer rates, a point made in the New Jersey Division of Rate Counsel’s testimony when WIPA was being considered. Under these FMV laws, corporations get to add to their water/sewer holdings for the benefit of their shareholders, but ratepayers foot the bill. AEA opposed WIPA because it permits a system to be sold without a voter referendum, increasing the chance of back-room deals, reducing the public’s voice, and limiting civic dialogue about an important community matter.
            AEA sees eye-to-eye with corporate-owned utilities on many issues, such as protecting water supplies and properly maintaining infrastructure. Professionals in government-owned utilities and corporate-owned utilities have worked very hard, together, to keep water and sewer services going during COVID-19. However, AEA opposes tactics often used to promote the corporate-ownership alternative. Promoters of these deals misrepresent the record of government-owned utilities and fail to tell the ratepayers of the true cost impacts of a sale.  They make references to “regionalization” and “economies of scale” to suggest the system being purchased is becoming part of some highly efficient, centralized network, a dubious claim.  NJAW bought the Long Hill Township (Morris County) sewer system and the Haddonfield (Camden County) sewer system –miles away from each other. No economies of scale there. 

AEA Seeking Presentation Proposals for Upcoming Conferences

Posted on: May 29th, 2020 by eric

AEA is seeking proposals for presentations for AEA training programs, workshops, and conferences.  Submissions are primarily used to create programs for the fall and spring conferences in Atlantic City but may be selected for other education activities such as the Environmental Professional Development Academy or special one-day and half-day workshops. It should also be noted that due to the ongoing Covid-19 pandemicand associated restrictions at this time, we are also evaluating the necessity of holding a series of shorter topic-specific webinars in the fall, in lieu of the fall 2020 or spring 2021 meeting.

Abstracts are Being Sought From Executive directors, CFOs, operators, operators, financial, accounting, management, human resources professionals, public officials, regulators, engineers, scientists, consultants, sales representatives, manufacturers, academics and others with expertise, knowledge and skills applicable to the management of water, wastewater and solid waste facilities in New Jersey. Preference given to submissions from AEA member organizations.

AEA conferences and workshops are attended by decision-makers (commissioners, executive directors and managers), staff, professionals, licensees, and service providers associated with local water/wastewater/solid waste utilities.

Please refer questions and send completed abstracts to Karen Burris at [email protected] and Lorna O’Hara at [email protected] and add “AEA 2020-21 Presentation Proposal” within subject line. Submission deadline is August 31, 2020. All submissions will be considered for the November 2020 and March 2021 conference.

For full details, including a list of topics, contact information and more, please see this document.

You may download a proposal submission form here.

AEA’s April 24, 2020 Letter to Gov. Phil Murphy

Posted on: May 12th, 2020 by eric

AEA recently wrote to the Governor to inform him about the extraordinary work members have done during the COVID19 emergency. We commend the DEP and the DCA for their guidance and note that water, wastewater, solid waste  sector workers also need PPE.  
 
The Hon. Phil Murphy, Governor
Office of Governor
P.O. Box 001 
Trenton, NJ 08625 
 
Dear Gov. Murphy:
 
During your many, thorough public COVID-19 briefings, you have noted the heroism of the medical community, first responders, grocery store workers and others. Like you, the members of the Association of Environmental Authorities feel enormous gratitude toward and admiration for these workers. 
 
The members of AEA are public local, regional, and county authorities and municipal utilities that together provide drinking water, wastewater and solid waste services to most New Jerseyans. We want to take this opportunity to tell you about similar singular and noteworthy efforts in the New Jersey water, wastewater and solid waste sector.
 
Utilities must always be prepared for emergencies and disasters and so, as COVID-19 was spreading and leaders like you were beginning to sound the alarm, our sector was planning and preparing in order to maintain without interruption vital public health and environmental services: supply of drinking water, collection and treatment of sewage, and collection of trash and recycling. Our members: 

  • Directed administrative and other non-operations staff to work from home
  • Increased disinfection and sanitizing of facilities and equipment
  • Organized operations and other mission-direct staff into squads or groups, developing work schedules that would isolate one group from another. 
  • Created contingency plans and designated on-call staff
  • Implemented procedures to limit or eliminate access of third parties such as vendors to plants and facilities.
  • Arranged to conduct business online and in safe, socially distant ways.
  • Suspended shutoffs for nonpayment. (Note that many public systems don’t do shutoffs for non-payment in any case.)
  • Eliminated non-essential field work and customer site visits in order to protect staff 
  • With the NJDEP, addressed issues such as access sampling sites so that sampling and testing would not be impaired

AEA participates in calls, which involve a cross-section including EPA, NJDEP, OHSP, DOH, NJCICC, NJBPU, investor-owned utilities, publicly owned utilities, and associations. During these calls, we hear updates, share information, trades ideas and strategies, and anticipate collective challenges. We are particularly grateful to Commissioner McCabe, and her staff, and Lt. Gov. Oliver, and the staff at DCA, for their assistance. AEA supports our members with weekly check-in calls. Most utilities are keeping in close touch with neighboring utilities, too. This sharing is not only practical; it provides much-needed moral support as well.
 
One topic that comes up on every call is the need for PPE. Our workers at wastewater plants and in other aspects of their work need to be protected from COVID19 and other pathogens. We urge you to make PPE for our workers as high a priority as possible.
 
Thank you, Gov. Murphy, for your great leadership during this crisis. We hope you and your family remain safe. 
 
Sincerely,
Peggy Nolting Gallos
Executive Director
Association of Environmental Authorities

A Refresher on Crisis Communication – by Amy Cook-Menzel, Communications Manager, ACUA

Posted on: April 2nd, 2020 by eric

Good communication is always important, but in a crisis, it is even more essential. The good news is that there are some basic commonsense steps to take to get information to your employees, stakeholders and the public. 

Create a communications team. A small team with key representatives from communications, leadership and Human Resources will help craft and vet messages to be sure they hit the mark.  

Develop your message. Your initial statement should include a clear explanation of what you are doing to manage operations and to keep staff and customers safe. In addition, remember to:

  • Accept responsibility – this applies to all crisis situations. Apologize (sincerely) if necessary and state the pertinent facts.
  • Explain – state the steps you are taking to move towards a solution, share response times and expectations as clearly as possible. 
  • Address questions people will have. Put yourself in their place and consider what you would want to know. Focus on what is important to them.
  • Empathize – show that you understand what is at stake.
  • Express thanks. 

Communicate early and often. Your key team members should work to establish a consistent message that can be shared with stakeholders as soon as possible. Be sure to provide updates often and take steps to monitor and respond to feedback from all communications channels.

Remember that it’s ok to change your mind. Sometimes we can anticipate what might happen, but it’s certainly possible that you may find that situations are changing quickly, and new plans must be implemented. Being transparent and sharing that you are open to making changes based on new information builds trust.

Make it easy for people to find relevant information.Place information on the home page of your website and pin it to the top of social media feeds so people will not have to search to find it.

A note on communicating with employees. Not only are they serving on the front lines, carrying out their work completing essential duties to protect public health, but every one of your employees also serves as an ambassador for your organization as they interact with public. Be sure you have a clear and consistent message companywide that is shared across all departments and employees. Post information in highly visible places, share through email and your company intranet. Communicate with employees often.

In all your communications, and in your daily work like, preparation, commonsense, clarity and sincerity go a long way in building trust and credibility. Look for ways to use this opportunity to help the public learn more about the work that your employees and your facility performs.

Be safe and keep communicating!

Is George Hawkins Making the Case for Public Water and Sewer?

Posted on: February 10th, 2020 by Peggy Gallos

You might want to check out George Hawkins, former manager of D.C. Water, on the Water Values podcast (thewatervalues.com).

Hawkins is interested in helping older systems with a declining rate base through the nonprofit arm of a new venture he has dubbed Moonshot Missions. (It also has a for-profit side offering services Hawkins says relate to “change management.”) He spoke about this venture at the Jersey Water Works conference on Dec. 13.

On the 20-or-so-minute podcast, Hawkins says, “The question has been on my mind, how to help these resource-constrained communities. Really good people working hard, but hard-pressed to adopt strategies that can save on existing operating and capital expenditures while improving performance to try to get into a virtual—virtuous!—cycle of performance.”

Moonshot Missions will provide free consulting services to struggling systems located in struggling communities. While Hawkins does not speak directly in terms of public versus private on the podcast, his optimism about the ability to turn the systems around seems to reflect a broader optimism that public systems have the capacity to manage their own problems and when warranted, change course. It is an alternative narrative to the one that our friends in the investor-owned community like to offer. Their narrative implies that the era of government ownership and operation of water and sewer systems has run its course and that only private Big Water (such as American Water Works subsidiary, New Jersey American Water or Aqua or Suez) can solve the problems and deliver good service. The president of the National Association of Water Companies, Robert Powelson, has been making the rounds of New Jersey op ed pages lately, pushing that narrative.

Hawkins also challenges another assumption, one that is widely repeated across the water/sewer sector by all kinds of people and that Big Water loves to refer to. Hawkins questions oft-noted statistics, mainly from the American Society of Civil Engineers “report card,” about the enormous costs required to fix aging infrastructure. “It is one of my fervent beliefs that the numbers that we hear about ‘oh, it’s a trillion dollars needed for the improvements to water and infrastructure’ are wrong. Because all of them are premised on how money used to be spent.” Hawkins concedes that when he managed D.C. Water, he spent money the way it “used to be spent.”

But, he told Water Values host Dave McGimpsey, he has come to believe a different approach, one that could make managing infrastructure costs more manageable for struggling communities, is in order now. “If the water main on 18th street needed to be replaced, we’d replace the whole main. Those are incredibly expensive projects and the water main is the cheapest part of it,” he said. He enumerated “non-pipe” expenses, including traffic control, permitting, and resurfacing. Hawkins says the “new” approach he now endorses involves doing a condition assessment of the existing pipe, “surgically” repairing it, and then cleaning and lining it.

“You can save 75 percent of that cost!” said Hawkins.

In calling out the idea of wholesale line replacements, whether he means to or not, Hawkins is challenging another investor-owned utility talking point. Their narrative includes direct and indirect references to the ASCE and similar assessments as a justification for why they are the answer to the Future-of-Water/Sewer.” They often emphasize pipe age as the most significant metric for determining capital priorities. If a mile of pipe is old, it must need replacing, they say. Coincidentally (or not so coincidentally?), investor-owned utilities collect profit on (ROI) capital projects. While they may have a strong incentive to keep operating costs down, the incentive to keep capital costs down would seem to run counter to their own best interests. For them, replacing that whole old line on 18th street makes sense, doesn’t it?

Governor Calls for 2020 Referendum on Lead Removal

Posted on: January 22nd, 2020 by eric

In his 2020 State of the State speech in January, Gov. Phil Murphy outlined plans to unveil New Jersey’s new Energy Master Plan, and hand-in-hand with that, discussed ongoing efforts to eliminate lead from water and sewer pipes throughout New Jersey.

“We’re working to protect every school and home in New Jersey from the dangers of lead,” Murphy said. “I applaud Mayor Ras Baraka, Essex County Executive Joe DiVincenzo, Freeholder President Brendan Gill, and many legislators, for their partnership to fast-track the elimination of lead service lines in the City of Newark.

“But, we all know this is a statewide problem. It extends far beyond just lead in old water lines — lead paint is a much bigger problem — and it extends to our suburban and rural communities.”

Murphy said the effort would require a “significant investment” that will involve funding to replace ol lead lines, as well as “a veritable army of union workers — plumbers and pipefitters, remediation experts, carpenters and laborers, among so many other tradespeople.”

Plans call for a proposal to be put together to go before voters in a November 2020 referendum.

Senate President Steve Sweeney echoed his sentiments, saying the senate should prioritize a clean water plan that would include drinking water protections for lakes, streams and aquifers.

“Clean water is a basic necessity and any formula for success must include quality education and a fully functioning transportation system,” Sweeney said. “These are major challenges that will require a major commitment of resources but we cannot afford to be intimidated. We have to be willing to invest political willpower if we are to make real and lasting progress.”