The Business of Water Utility Management

Many municipalities have always used the water utility as one area of differing upgrades when times are tough and many times when times are not so tough. The problem is exacerbated as residence building lose value and thus apply for a different or lower taxation. Further, if new building does not take place, there will be a loss of impost fees that the utility may have counted on for revenue. On top of all that, there is an environmental movement to lower consumption. If your revenues are generated by metered water usage, lower usage means lower revenues.

This downturn of revenues forces municipalities to raise rates higher than inflation. Alternatively they can try to cut expenses or watch their utility fall apart slowly. If the utility is privately owned they will raise the rates. Water is just too important to ignore. If you were to survey most water utilities, you would find that they accomplish quite a bit with minimal staff (or is that staph). The municipality or private utility does face a lot of expense with lab testing. This lab expense may be lowered in the future with the addition of auto bacteria testers about to hit the market. In reality most utilities have little room to cut expenses.

It is a bad time to be an elected politician. Perhaps it would be better to have private enterprise take over some of the plants. Most private companies can operate at less cost even when you think it is already bare-boned. On the upside if conservation is really good, infrastructure may support some growth without expanding it thus saving money.