KAWC

Pay Your Water Bill and Support the Fracking Lobby

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May 1, 2012
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Two giant private water companies — Aqua America and American Water — are members of the Marcellus Shale Coalition, a energy-industry lobbying group focused on expanding gas drilling and protecting energy companies from onerous regulations over fracking and protecting people’s livelihoods and lives.

American Water is the corporation that provides your water if you live in Lexington via its locally-named but New Jersey-controlled subsidiary Kentucky American Water.

Kentucky American Water is engaged in a publicly stated economic policy of continually raising your water rates to increase its bottom line as you use less and less water. A portion of your bill, then, is now being paid forward into the fracking lobby:

These investor-owned, publicly traded water utility companies are also dues-paying “associate members” of the gas industry’s powerful Marcellus Shale Coalition, a fact confirmed by coalition spokesman Travis Windle, who says associate members pay $15,000 annually in dues. “Our associate members are really the backbone of the industry,” adds Windle.

But that’s not all!

In the meantime, the water companies are selling water to the drillers while calling for fracking to be done in an environmentally responsible manner. In a presentation to investors last month, American Water stated that it is “realizing additional revenues from water sales to drilling companies while remaining vigilant in protecting our water sources.” In the presentation, the company noted it is “currently selling water to gas drillers at 34 distribution points in Pennsylvania,” and that it “sold 250.4 million gallons of water to gas drillers from January through December of 2011, producing $1.6 million in revenues.”

Continue reading at AlterNet

And continue paying your water bills to Kentucky American Water because fracking is good for all of us.

If you haven’t seen Gasland, check it out:

Kentucky American Water screwing Lexington again

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March 8, 2012
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The Herald Leader Editorial Board had this to say the other day:

Lexington residents and businesses will soon be getting their sewer and landfill bills from the Greater Cincinnati Water Works — costing our government an extra $700,000 a year.

Yes, you read that right.

By summer’s end, you’ll be writing a check to or approving an automatic withdrawal by a municipal utility in another state.

That’s because the private Kentucky American Water, which touts itself as a model corporate citizen, cut the city off.

A Kentucky American official last year explained that billing and collections contracts such as the one with Lexington were no longer “a good fit” for the company, which is part of investor-owned American Water, based in Voorhees, N.J.

In most places, the fit would be fine because in most places the city owns both the water and sewer systems. Plus, sewer bills are directly based on water consumption.

But in Lexington, one of very few cities its size that does not own its water utility, things get complicated — usually, as in this case, to the detriment of consumers and taxpayers.

They’ve got a lot more — from the cost breakdowns, how we ended up with Cincinnati, to official comments — and you should read it all.

Lexington has been abused by the American Water corporation before. Based in New Jersey, it renames its state-based systems (Kentucky American Water, Tennessee American Water, etc) as if they are localized entities. But they aren’t.

KAW is belongs to a publicly traded company. There’s nothing wrong with publicly traded companies, per se, but when a government puts a public utility in the hands of a publicly traded company, that public utility is now controlled by the fiduciary best interests of the stockholders. Which means your water price is dictated by investors’ need to make money.

We’ve looked at all this before, especially around the Newberry-era water rate hikes which KAW claimed were needed for infrastructure while American Water’s own annual report made perfectly clear that rate hikes were needed primarily to increase profit and return for shareholders. (Read that here, if you like.)

Looking at the sewer issue, it again becomes obvious that our generous local water providers are making decisions about our infrastructure and utilities which have little to do with local needs or good corporate citizenship.

Here’s what “Missouri” American Water is doing:

For the first time in more than a decade, the city will bill sewer customers for wastewater service. Users currently pay sewer fees as part of the bill they receive from Missouri American Water.

The result means customers will send a smaller payment to Missouri American, but will send a separate check to the city for sewer usage.

Christie Barnhart, spokeswoman for Missouri American, said the move was part of a nationwide decision to eliminate billing for municipal utilities the company did not provide. The company currently handles sewer and trash service billing for municipalities in 30 states, in addition to collecting bills from its water customers.

It’s really about getting back to our core service, which is providing water service,” Ms. Barnhart said.

And here’s what “Tennessee” American Water is doing:

Tennessee American Water no longer will collect sewer and garbage fees for some area municipalities after October, a change city officials say could prove costly for them and confusing for ratepayers.

“It’s kind of a surprise,” said Jerry Stewart, Chattanooga’s director of waste resources, adding the privately held water company had been collecting sewer fees for the city since the 1950s.

….Tennessee American spokeswoman Jessica Presley said the company decided in 2011 to exit billing for municipal sewer and other services by Oct. 31.

We’ve made a decision to focus on our core business of providing quality, reliable water to [our] customers,” she said.

And “Pennsylvania” American Water is not only forcing a rate hike on its customers but also dumping the sewer billing process:

Pellegrino explained that, while the McNeilly project is the main reason for the rate increase, there is another reason.

“PAWC (Pennsylvania American Water Company) is going out of the business of billing for sewage (as of Oct. 12, 2012),” he said, “which they had been doing for about 10 years.”

In turn, the township will have to look for another company to collect sewage bills, Pellegrino said, and he expects that the new company will charge more.

American Water’s 2012 Annual Report states:

Despite challenging weather events in the northeast region of the United Sates in the third quarter of 2011, for the year ended December 31, 2011, we generated $2,666.2 million in total operating revenue, and $803.1 million in operating income compared to total operating revenue of $2,555.0 million, and $728.1 million in operating income in 2010. Our Regulated Businesses, our largest operating segment, generated $2,368.9 million in operating revenue, representing 88.8% of our consolidated operating revenue compared to $2,285.7 in operating revenues representing 89.5% of our consolidated operating revenue in 2010. This increase of 3.6% in operating revenues, when compared to 2010, was primarily driven by rate increases offset by decrease in sales volume in all customer classes in 2011. Additionally, for the year ended December 31, 2011, our Market-Based Operations generated $327.8 million in operating revenue, compared to $294.7 million in operating revenues in 2010, an increase of 11.2%.

Less water being used, but higher rates of payment means good things for the company, bad things for the customers, and return for investors.

Or:

[I]ncreased water conservation, including the use of more efficient household fixtures and appliances among residential consumers, combined with declining household sizes in the United States, have contributed to a trend of declining water usage per residential customer. All of the states served by our Regulated Businesses have experienced a declining trend in water usage per residential customer, with the rate decline in the various states averaging 2.1% and ranging between 1.3% and 3.42% annually over the last 5 years, some of which may have been attributable to variations in weather conditions. Because the characteristics of residential water use are driven by many factors, including socio-economic and other demographic characteristics of our service areas, climate, seasonal weather patterns and water rates, these declining trends vary by state and service area and change over time. Our Regulated Businesses are heavily dependent upon operating revenues generated from rates we charge to our customers for the volume of water they use. Declining usage due to conservation or the economic environment contribute to regulatory lag and will have a negative impact on our long-term operating revenues if we are unable to secure appropriate regulatory treatment to offset the usage decline.

Therefore, rate hikes. Blue skies around the country!

In 2011, we received authorizations for additional annualized revenues from general rate cases, totaling $78.8 million. In April 2011, we received final orders in our Tennessee and West Virginia rate cases, both of which were filed in 2010. On August 1, 2011, our Virginia rate case, which was filed in 2010 and for which interim rates had been in effect under bond subject to refund since the third quarter of 2010, was approved. In November 2011, we received final authorizations in our Pennsylvania rate case and our Hawaii rate case, both of which were filed in 2011.

Additionally settlements have been reached, in our general rate cases in Missouri and New York, which could provide approximately $30 million in additional annualized revenues if approved in accordance with the settlement agreement. There is no assurance that the settlement amounts, or any portion thereof, will be approved as they are pending regulatory approvals and are all subject to change. Details of this case will be released upon final approval.

On February 23, 2012, the Iowa Utilities Board approved an additional $2.8 million of annualized revenues for our Iowa subsidiary. The increase approximates what we had been collecting since July 29, 2011 under interim rates and the partial settlement that was reached in October 2011.

It goes on, but you get the point.

On a final note, I recently picked up a copy of A Dynasty of Water: The Story of the American Water Works Company for a dollar at the ReStore. It’s a corporate biography commissioned by American Water and published in 1991. Here’s a stirring passage about Lexington:

….[If] the primary avenue of attack on a privately owned public utility is legal, the principal line of defense, and the obvious point of counterattack, is political. (Machiavelli recognized the power of public opinion, even in the despotic city-states of the sixteenth century, and counseled the prince on the importance of winning and holding public support. The difference then, of course, was that if the public attitude turned sour, it expressed itself not merely in a painful defeat at the polls, but in riots and rebellions, conspiracies and assassinations.)

In Lexington, Kentucky, the struggle came to a head quickly, as described in the American Water Works annual report for 1960:

The City of Lexington moved early in the year to acquire the Lexington Water Company under the terms of its franchise. Because we were convinced that the best interest of the company would not be served by the sale of this subsidiary, and that it would not benefit the public served, we advised the City that we would be unwilling sellers, and were prepared to conduct a vigorous campaign to gain support of Lexington citizens in opposition to the acquisition.

The campaign was successful. “Late in the year,” the report went on, “the City abandoned its proposed acquistion… when incomplete valuations indicated the extent of the undertaking and it was realized that public opinion was opposed.

Thanks, Machiavelli! Cheers to you, sir.

Will H-L Ed Board run B&P out of town?

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November 18, 2011
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Seriously. Three editorials in one day? If they kept that up and just started a blog, Barefoot would go out of business. All our ad revenue would be sucked up and no one would ever stop by. We could just close up shop.

Here’s the HLEB on the water company:

The financial fallout of Lexington’s past error in outsourcing its water supply provides a cautionary tale. The board that oversees Louisville’s public water utility just passed a 3.75 percent rate increase, the same as last year, and will pay a $19.2 million dividend to the city. Meanwhile, Kentucky American, our private water supplier, which pays dividends only to its shareholders, got approval for a 29 percent rate increase last year and can be expected to go for another soon.

Here’s the HLEB on the hiring/firing issue:

[T]he administration of Mayor Jim Gray did the right thing by asking Cheryl Taylor to resign when it became clear that she had been involved in seeking work for her husband, an electrical contractor, through the department she oversaw. That’s nepotism and it is rightly outlawed under our city charter.

And here’s the HLEB on Doug “F*ck You!” Martin:

Closing Kearney a hack idea to help private developers

Councilman Doug Martin has upped the ante in the quest by private golf developers to blame public courses for their business woes.

Martin has suggested closing Kearney Hill Links, by far the city’s finest venue, and one of the Midwest’s truly great municipal layouts.

That last one’s a doozy… so check it out in full.

But you see what I mean. It’s like B&P barely needs to exist anymore if they keep churning ‘em out at that rate. Slow down! You’re scaring us.

Hiring & Firing & Resigning at LFUCG’s Environmental Quality and Public Works Division

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November 17, 2011
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Over the past week-and-half, there’s been some salivating going on. The Gray Administration’s Commissioner of Environmental Quality and Public Works resigned, saying she’d been asked to step down, and emailed people throughout LFUCG in order to fire the first shot.

The Gray Administration has kept quiet and, in response, the usual voices in LFUCG — let’s call them Team Newberry, who know a bit about obstruction and cronyism — have tried to frame the debate as if the Gray administration had something to hide.

Which is a fine place to start from — people in positions of power should be viewed skeptically, their actions questioned and transparency demanded. That’s all fine, and it’s funny that so many in Team Newberry are now figuring this out.

It should also be interesting to see how the Ed Lanes and Doug Martins handle the latest developments — in which it becomes pretty clear the Gray Administration acted diligently to protect the city; in which it becomes pretty clear Gray’s silence on the matter isn’t a matter of obfuscation but one of legality; and in which it becomes clear that some people really want to hire their husbands even after they’re told multiple times that it ain’t cool.

City officials cautioned Lexington’s former Commissioner of Environmental Quality and Public Works Cheryl Taylor at least three times not to direct city work to her husband, according to emails obtained Wednesday by the Herald-Leader.

Taylor abruptly resigned last week, saying she was asked to step down after the city began investigating whether she inappropriately tried to direct city funds to her husband.

Some of the requests to hire her husband, Robert Taylor, an electrician, were from officials in the Division of Waste Management, under Cheryl Taylor’s supervision. At least two requests were by Taylor herself, according to the transcripts released by the city in response to an open-records request from the Herald-Leader.

On at least three occasions in 2011, Law Commissioner Janet Graham emailed Taylor that her husband could not be hired as a city employee or do contract work for the city because it would violate the city’s nepotism ordinance.

Read the entire article… it is full of hilarity.

On a bright note, Ms. Taylor is well within her right now to hire her husband for anything he wants to do since she no longer works for the city. And he can now get a job with the city because she no longer works there. So… problems solved.

It’s also worth highlighting the fact that Ms. Taylor worked previously in the Newberry Administration as the Environmental Quality Commissioner overseeing Lexington’s sanitary and storm sewer system… before leaving that job to work for Kentucky American Water. It didn’t seem like a particularly good idea to bring her back to begin with and as it turns out, it probably wasn’t.

But perhaps Ms. Taylor could now get re-hired by Lexington’s corporate overlords at KAW as they seek to further screw the city’s taxpayers:

Now investor-owned Kentucky American Water has given six months notice that it’s ending its contract with the Lexington-Fayette Urban County Government to collect sewer, landfill and water quality (storm water) fees for the city.

Water and sewer bills are natural companions because sewer bills are based on water consumption. Kentucky American was paid $1.6 million a year under its latest billing contract with the city.

….Meanwhile, American Water, Kentucky American’s New Jersey-based parent, says the company’s third-quarter profits were up 2.3 percent — in part because rate increases more than offset declining water consumption.

Ah… American Water forcing rate increases they don’t need as water consumption declines — Team Newberry knows all about that.

Hopefully Martin, Lane, et al., will keep all of this in mind the next time they get their tighties in a twist. Sometimes it’s easier to just excuse yourself and dig a little deeper.

Bye-Bye, Jim Newberry

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December 21, 2010
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Lexington’s outgoing Mayor and sometimes-Democrat Jim Newberry sat with the Herald-Leader’s Beverly Fortune for an exit interview.

Ms. Fortune was obviously in the spirit of the season, but there are some highlights:

Q: What would you say are your major accomplishments over the past four years?

A: Creation of the higher education triangle…

Oh yes… the triangle! That’s his biggest accomplishment — drawing a line between three existing locations and pretending like he was responsible for them already being there and the deals put in place through other people’s very hard work.

Next!

Q: Looking back to the campaign, there are people who think one thing that did not play in your favor was the timing of the rate increase by the water company. With the benefit of hindsight, is there anything you could have done to lessen the impact of that 37 percent rate increase?

A: I think that was a critical factor in the campaign. I’m not sure there was anything I could have done. Kentucky American doesn’t listen to me. If I could have persuaded them not to impose the fee I would have, but they’ve never listened to what I’ve had to say, so I’m not sure there’s anything I could have done.

Bummer, dude. You’d totally expect all that money they gave your campaigns to mean that you could boss them around and not the other way ’round. You really would. Oh well. At least the people of Lexington will pay more for their water — thanks!

And…

Q: Another issue that became controversial was CentrePointe. You said it was private land, a private developer and not your place to intervene. Looking back, is there anything you would have done to alter that design or the project planned for that block?

A: Absolutely not.

He had more to say on that topic, so you’ll have to click through for the rest. But that about sums it up.

Q: What comes next for you?

A: I will take some time to think about that. I would love to have the opportunity to teach and write for a while. I enjoyed practicing law. There may be some business opportunities. But I want to take time to think about that and make a decision that makes sense for my family.

That’s all — you can read his answers to the above in full and on other topics at Kentucky.com (and you should, it’s cute).

Alright, team. Time to say Goodbye to Jim Newberry.

Maybe the water company’s hiring.

Mayor Newberry still shocked that gambling is going on here

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October 12, 2010
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Does Jim Newberry really expect the people of Lexington to buy this garbage about his “outrage” over KAWC raising their rates (which he is responsible for)?

Cue Casablanca, once again:

$20,000 sure goes a long way in Newberry’s Lexington. Too bad you’ll never see any of his winnings…

Mayor Renault is shocked, shocked that KAWC is raising their rates!

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October 1, 2010
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I told you Wednesday morning, and the Herald Leader told you yesterday: Jim Newberry’s fake outrage about the KAWC rate hike that he is directly responsible is just laughable:

Mayor Jim Newberry’s criticism of Kentucky American Water’s “greed” reminds us of that scene in Casablanca in which Capt. Louis Renault, played by Claud Rains, says, “I’m shocked, shocked to find that gambling is going on in here,” while pocketing his winnings.

Renault was putting on a show for the Nazis; Newberry for voters. They are equally believable.

*****

This inspired Newberry to fire off a stinging rebuke of his supporters at the water company: “Good judgment would have required them to wait a few more days for the commission’s decision before imposing an exorbitant increase. Greed made them move forward.”

It would have been more believable if he had said: “They should have waited until after this election to stick it to my constituents.”

Perfect hilarious analogy, FTW:

Newberry produces faux outrage against his political allies’ rate increase. That he is directly responsible for. Again.

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September 29, 2010
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Yesterday, the Kentucky American Water company decided to go ahead and implement it’s 37% rate increase on the people of Lexington. This rate increase is due, of course, to KAWC’s de facto employee Mayor Jim Newberry’s rubber stamping of their proposed treatment plant that everyone knew was going to increase rates.

Newberry knew it. The KAWC employees and lobbyists that have given $18,000 to his campaign knew it. The KAWC employee and lobbyist who pushed this new plant (and is a max donor to Newberry’s two mayor campaigns, and held a $10,000 fundraiser for Newberry in December two days after Newberry proposed limits on lobbyist fundraising) also knew it. Jim Gray knew it, and that’s why he voted against its approval.

But it’s election season, and what does Jim Newberry do when his closest political allies and accomplices start screwing over Lexington consumers?

Fake outrage! Rage against (my) machine!

“While Kentucky law permits the action they have taken, Kentucky-American has let greed trump good judgment,” Newberry said. “Good judgment would have required them to wait a few more days for the Commission’s decision before imposing an exorbitant increase. Greed made them move forward.”… “It comes on the heels of an 18 percent increase last year,” Newberry said. “Overall, this increase raises rates by approximately 60 percent over the 2008 rates. By any measure, that increase is unfair and extreme.”

Exorbitant. Greed. Unfair. Extreme. All true. And all made possible by Jim Newberry, despite another missile fired in his ongoing War on History.

Remember what the HL said about his identical faux outrage and revisionist history earlier this year:

Mayor Jim Newberry has a conveniently short memory — or a whole lot of nerve — to criticize Kentucky American Water’s rate request.

The soaring cost of water is a direct result of a plan Newberry supported, despite pleas from council members and the Public Service Commission for the city to explore cheaper alternatives.

No, it’s definitely nerve. The nerve to be a shameless puppet for an industry, and then put on a dishonest theatrical performance in which you condemn that same industry for taking an action that you made possible. That takes a lot of nerve.

And VISION.

Newberry’s buddy takes aim at Lexington’s "Local First"

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September 23, 2010
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You familiar with Warren Rogers? He’s Chairman of the KY Club for Growth and Vice Chairman of the All-Government-is-Evil group Bluegrass Institute for Public Policy Solutions. He’s also the one that helped kill the effort for Lexington to buy the water company, then benefited from being hired by KAWC to be a contractor on their new $160 million treatment plant (whose bill will be picked up by all of us through rate increases).

Oh, and he just happens to have thrown $1,250 Jim Newberry’s way so he can be mayor and look after his interests.

Interests like… combating the evil socialist forces of Lexington’s “Local First” movement:

Considering how high Newberry jumps when his big money donors tell him to, I’d say that Local First and local businesses here in Lexington should be sweating a bit.

Or volunteering.

UPDATE: Rogers appears to be doubling down, taking direct aim against Jim Gray now. Joining in the fun with him is former lunatic Teabagger candidate from the Republican primary in the House 6th, John T. Kemper III.

Jim Newberry’s values

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September 10, 2010
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When Jim Newberry ran for Congress, he said that the most important factor for voters should be the “values” of the candidates. He repeatedly flaunted his Faith, Family Values, and support of anti-sodomy laws in Kentucky.

Well today, Jim Newberry released his “Moving Lexington Forward” plan. The plan devotes a page to Newberry’s “Values”, but oddly enough he doesn’t mention Faith, Family Values, or rounding up Lexington’s homosexuals to put in prison.

Here’s what he does mention:

Respect. If we are to live together as members of our community, we can only work together if we respect our fellow citizens and act toward them in a fashion consistent with that respect. The personal acrimony that too often becomes a part of our public discourse must end. We must replace that personal acrimony with the tolerance which comes from respecting our neighbors, even when we disagree with their point of view.

Tolerance? I thought you were for rounding up homosexuals and putting them in prison, since as late as 2006 you said you regretted nothing from that Congressional debate? Are you finally abandoning this, Jim, or do you just want us to forget that that happened?

Also: “respect our fellow citizens and act toward them in a fashion consistent with that respect”? You mean respect them like this?

Giant, colossal failures like CentrePointe happen sometimes, but telling a large segment of your constituents that they literally mean nothing and are of no consequence isn’t exactly “respect”, in my book.

Moving on to “Integrity”:

Integrity. Every contact between citizens and every part of their local government must be conducted at the highest level of integrity. To do so, we must operate transparently, ethically and honestly in every respect.

Oh boy, where to start. Transparently? You mean like stonewalling the whistleblower investigation every step of the way for 4 months? Having tax dollars pay a lawyer so that he can sue the council to prevent them from receiving information? Denying open records requests from the media? I don’t think that word means what you think it means, Jim.

Ethically? You mean having tax payer funded city workers doing your re-election campaign work? Retaliating against government whistleblowers? Proposing an ordinance limiting lobbyist money and then having a lobbyist hold a fundraiser for your campaign two days later? Strike two.

Honestly? You mean blatantly and repeatedly lying to them about the water company? Blatantly lying about “supporting” the state audit of Bluegrass Airport? Lying about none of your administration seeing the Patrick Johnston fraud report? Taking credit for things that you had absolutely nothing to do with? Not even remotely close, Jimbo.

But hey, at least you’re no longer touting the fact that you want to round up homosexuals and throw them in jail. Baby steps…

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