The Public Water and Wastewater System Infrastructure Task Force met in Frankfort Wednesday afternoon to hear from stakeholders. The task force is convening for the second year in a row to discuss ways to improve oversight, management and assistance for troubled water and wastewater utilities.
Cochair Representative Jim Gooch (R-Providence) voiced concern that the group was not making much headway from meetings held in 2019. “There is still a problem out there,” he said. “We know that.” However, Gooch and those testifying on Wednesday acknowledged that solutions are often complicated and multifaceted.
Mike Gardner, water and sewer systems manager for Bowling Green Municipal Utilities, testified on behalf of the Kentucky Municipal Utilities Association (KMUA). KLC worked with KMUA to draft a list of recommendations from cities for the task force to consider. They include:
- Keep utility revenues within the utility by prohibiting the transfer, comingling or use of rate revenues for functions other than the operation, maintenance, debt service or planning of the utility.
- Start key best management practices.
- Start best financial management practices, such as ensuring rates are cost based and that they are adjusted annually for inflation.
- Establish financial accountability in the form of an annual independent financial audit or financial report.
Additional recommendations for distressed systems include:
- Authorize the Kentucky Division of Water (DOW) to declare a utility as distressed.
- Provide training assistance that is developed or approved by the DOW for water commissioners or board members of a distressed utility.
- As the COVID pandemic passes, revisit measures to assist distressed systems with additional resources and greater accountability.
Gardner stressed that funds need to be put back into municipal utilities to deal with aging infrastructure, one of the greatest challenges facing facilities. “Small systems are really getting hammered because of all the changes in technology and requirements,” he remarked.
Gary Larimore, executive director of the Kentucky Rural Water Association, pointed out that the cost of maintaining and operating a water and wastewater utility is only increasing. “In the future, water is not going to get more cheaper,” he warned. “From a utility standpoint, we need to make sure that we have the revenue to pay our bills.”
Legislative leadership asked members of the task force to meet through December and provide findings before the 2021 session. You can read more on the 2019 task force’s report here.