City of Raleigh, Public Utilities Department: Strategic Plan
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WHY is the Department Implement ing a Strategic Plan?
The Public Utilities Department (PUD) is faced with many challenges. Ongoing reductions in
per capita water consumption and the relatively high fixed cost of running the utility have
resulted in challenges generating enough revenue to run the utility, even with a series of
significant rate increases and more than 10% of our positions vacant. The economic downturn
and the accompanying reduction in revenue from new development has also significantly
affected our revenue. The bond rating agencies in turn have increased the creditworthiness
requirements necessary to maintain the AAA credit rating, also adding higher revenue
requirements. Finally, we will have even higher revenue needs in the future to address aging
pipeline repair and replacement costs. All of these challenges are complicated by the fact that
the Public Utilities Department has a complex and capital intensive business model.
In June 2010, the City Council proposed creating a Water Utility Transition Advisory Task Force
(
WUTAT)
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to advise on conforming the water utility’s business model to reflect a sustainable
Strategic Plan.
Over the course of 18-months, the WUTAT met twenty times to craft a series of guiding
principles and to develop a number of recommendations that were presented to the Raleigh
City Council at a special meeting on March 5, 2012. The guiding principles included a call to
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City of Raleigh (2010). Water Utility Transition Advisory Taskforce: Roles and Responsibilities, General Raleigh
City Council Guidance.
City Council Guidance to WUTAT:
Consider establishing utility rates sufficient to cover the full cost of operation,
maintenance, environmental compliance, conservation education and
incentive programs, and infrastructure replacement based on industry
standards;
Consider establishing additional conservation education and incentive
programs;
Consider implementing a low income Customer Assistance Program; and
Consider combining the Stormwater Division with the Public Utilities
Department.