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The true risk to the community of pipe damage is underestimated and the potential for economic disruption increases.  The question is how do we lead our customers to investing in their/our future?  That is the question as the next 20 years play out. Making useful assumptions about increases in demands, prices, inflation rates etc. are key to useful projections and long-term sustainability. Building too much or too little capacity for example can have disastrous consequences (to the ratepayers on the former, to the local economy for the latter).

Getting funding relies on economic strength, a problem of you are in a depressed area (Detroit) or a boom that could crash at any time (North Dakota).  P3 opportunities are available for cash strapped communities but they come with a cost.  Risk must be allocated fairly – the private community will not take on too much risk without increasing costs significantly. Loss of control is one of those risk conversion issues.  Extensive planning and feasibility analyses should be expected – far more scrutiny than most utilities are used to.  The economic strength of the community is important to private investors.

In a prior blog we talked about the boom towns of North Dakota.  Things were booming in 2013 but the downturn in oil prices may get ugly.  The need for more fracking wells may have decreased (at least temporarily) and the decrease in the oil and gas costs has cut into local revenues, so is this is the time to keep planning for the boom?  South Florida did this in the early 2000s – and well, that real estate boom put quite a dent in the economy and population estimates for 2020 and 2030.  The balloon popped and so did the economy.  South Florida had the resiliency to bounce back because of weather and proximity to South America.  We have seen the result to an industrial economy – where a community relies on industry, well industry can be fickle.  Ask Detroit.  Or Cleveland.  Or any number of other Rust Belt cities.  Now they have infrastructure, but much of it is underused.
So while the Plains states plan for the boom, the boom has settled in some places. Already the oil and gas industry has shed 100,000 jobs (many high salary).  Texas, Kansas, North Dakota and Oklahoma are facing financial challenges in 2015 due to funding losses.  Alaska is dipping into reserves.  But that doesn’t mean the results of the 2010-2014 boom are not continuing, or at least portions of them.  Frack water continues to be discharged to local wastewater systems, but the revenues to pay for the needed upgrades is lacking.  Effluent limits for nitrogen and TOC for some rivers have decreased as a result of constant increased loading to the streams (more flow increases total loads, so if flows remain the same, the concentrations must decrease to maintain total loading).  The costs to reduce ammonia, for example from 10 mg/l to 2 or 3 mg/L can be $1-2/1000 gallon – over 50% or more of the current cost for treatment.

So is it a surprise that some communities fight the boom times?  Booms create disruption and uncertainly, and a need for technology (and costs).  Maybe stability does matter, as it can contain costs and treatment requirements.  However the boom can help communities in financial distress.  Detroit and Flint would love a boom – both have the infrastructure in place to support it as opposed to rural communities in the Plains.  But that’s is a key – they already HAVE the infrastructure in place.  The Plains, well, do not.

There is a lot of older, underutilized infrastructure out there.  Detroit, Flint, Cleveland, Akron, Toledo and Philadelphia are among the older industrial cities that have stable populations – people that live there most of their lives, have a trained and educated workforce, and normally have lots of water and infrastructure, and lots of potential employees, all of which are underutilized and at risk due to economic losses. But the booms rarely go to older cities. How that is?  Is this a leadership issue?  Convenience?  Quick profits?  And how long will the boom last?  Is it a matter of lack of understanding or regulations that creates the boom?  A combination of factors?  A better PR program?

Remember we all play defense.  Industry does not.  Industry plays offense all the time.  The private sector mode is play offense.  Get the message out.  Frame the message.  Win the game.  Is winning the game at any cost the right answer?  For boomers it is.  What about the rest of us?

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I got hacked again this past week.  I had the week nicely structured to stay in my office and get lots of work done.  Things I had been trying to complete for the past couple week.  This is the second time I have been hacked with this computer and I have only owned it for 3 months.  So the first hack involved someone diverting my email for 6 hours.  I could not get it back, but I stopped the diversion (I think) with the help of ATT.  Who knows what information was transmitted other than a lots of what is really spam.

Ok, so then I start getting these phone calls from “Microsoft Windows” noting errors they are receiving from my computer.  Now most you recall that Microsoft used to ask if you wanted them to be notified of errors, but since everyone said yes, they now just do it automatically.  Mostly the “Microsoft Windows” guys left messages on my cell phone since that is the number registered with Microsoft.  I picked up the phone one time, but the “Microsoft Windows” guy could not tell me which of my computers was sending the messages (I have more than one).

But that did not stop the calls which have accelerated of late.  So I get another call that I answer (from a number in Washington state) from “Martin” with “Microsoft Windows”  who, without accessing my computer, knows over 9,000 errors had been sent, starting the day I bought the computer.  He also knows the software serial information, computer serial numbers, etc., all of which he can recite over the phone and ask me to check to verify he is with “Microsoft Windows” because otherwise he would not have that information.  And then he notes that because the 25 digit codes for Windows 8 is not visible, “Microsoft” will cause a key lock on my computer – a message that I again could verify without him accessing the computer.  And of course that’s how he tries to convince me he is calling from “Microsoft Windows.”

NOTE:  Miscrosoft DOES NOT Call you – it is a scam (see the internet).  So I have the hacker on the phone.  He emails me his info (of course he has my registered email like everything else), which I note says pcsync.org, not “Microsoft Windows.” I asked and I was suddenly disconnected.  And within the hour, the computer is locked.  Clearly the acceleration of calls was because the hackers knew about the key lock because they installed it and they want to get to the last minute.  Now Martin called back about 20 times in the next 2 hours trying get me, but the number he left is not valid (despite his website listing it). And of course he will fix the problem for $239 plus whatever else he can sell you.  That’s the hacker scam – create a problem than get you to pay to fix it.

And when it locks – the result is a window that asks for Startup password – which Microsoft will tell you, indicates you have been hacked.  Except, then Microsoft says they need the 25 digit code for the operating software to fix your computer.  “But you need to get that from Dell” even though Dell only loads the software – you need to register it with Microsoft to make it work.  So I called Dell, and the first person says sure they can give it to you, but the second “no they need to send CDs.”

OK they are both wrong.  With Windows 8.1 the code is not on your computer if pre-loaded.  And of course Dell does not give you a recovery disk when you buy it.  Dell knows about the code.  So does Microsoft.  So an hour plus wasted there with two good organizations who clearly do not communicate.  So I am shut out of the new computer and the email.

Good news though is that maybe 10 years ago I was advised by Gateway (the old cow computers) to use iyogi.com to fix a prior issue.  So 13 hours later and lots of time with Amit, we are sort of back up running.  And of course iyogi knows about the code issue that Dell and Microsoft mis-advised me on and told me the story above.  And yet we both wondered how pcsync.org (the hackers) was tracking my computer error messages to Microsoft from day 1?  Have they hacked Microsoft?  Dell?

And the next day one of my friends, in talking about this says – “Hey wait, I keep having pop-ups for pcsync on my computer also.”  And later in the day, another says the same thing –“ pcsync is on mine too.”  And neither has a Dell – but they do have Microsoft Windows 7 or later.  And makes me wonder, who is taking responsibility for protecting the consumers here?  Clearly the computer manufacturers do not take responsibility.  Maybe they can’t.  Microsoft doesn’t appear to either, so that leaves us . . . . . vulnerable.  Mr. Gates you have a great operating system, but this problem costs us lost productivity, money, time, irritation…even when you have all kinds of anti-maleware and anti-virals on your computer.  If the hackers can get in day 1, how do you stop that?  And apparently the maleware doesn’t see it (hint).

So the questions:

  • Does “Microsoft Windows” know about this?
  • If so, why have they not fixed it?
  • Do the computer manufacturers know this issue occurs?
  • Why have they not talked to Microsoft about it?
  • Why doesn’t the maleware address it?
  • How are they getting in?
  • Is Microsoft hacked – perhaps the biggest hack of all?
  • And why have the internet police addressed pcsync and their ilk? It is all over the internet!!!!!

Clearly the penalties for hacking are not nearly severe enough.  And from a law enforcement and cyber security perspective, we clearly lack the resources to protect individuals, so beware!

And if you see pcsync – call iyogi or someone who can help.  Quickly!!


A project I am currently involved with looks at the impacts of climate change on public health in southeast Florida.  The initial grant focused on looking at socially vulnerable populations and the impact on chronic diseases these groups from climate change.  The question was whether climate change, which in southeast Florida is basically sea level rise, would have an impact on health issues.  On the face of it, the correlation between chronic health conditions and climate seems tenuous although the statistics support the link between chronic health impacts and socially vulnerable populations.  But what is interesting is that in general, the climate vulnerable topography and the socially vulnerable people do not correlate.  This may be a southeast Florida issue, but it is the less socially vulnerable who live in the climate vulnerable topography.

Those familiar with the history of southeast Florida know that makes sense because of the beaches.  The beaches are topographically vulnerable but eh wealthy want to live there anyway. But the problem is more pervasive.  The data actually can be mined further to reveal that the older homes (1940s-1960s), generally smaller and of lower value, were traditionally built on the high ground.  Turns out our ancestors were a little smarter than we thought – they actually thought this out.  Aside from Henry Flagler building the railroad on the high ground, most of the cities were located similarly – on the coastal ridge.  Drainage of the Everglades permitted the western migration of residences – newer and larger, but at lower elevation and mostly reliant on drainage across the ridge to the ocean via canals.  But as sea level rises, the water moves more slowly.

The question that must be asked then is what happens as this housing stock ages?  We already see some newer communities, primarily built for retirees, moving to relieve themselves of the 55+ designations to allow the housing stock to be sold – the children of the retirees don’t want the property and desire to sell it – often quickly.  To increase speed of sales (and ultimately retaining some value), eliminating the 55+ opens younger families to move in.  However the lower value of the properties makes them conducive to migration of people who are social vulnerability, so migration may be toward social vulnerable people moving to topographically challenged property.  That portends poorly for the link between climate and health in the future.

Two issues arise from the research.  First future health vulnerability from climate may be more related to vectors and waterborne disease than chronic health effects.  That expands the health vulnerability to all populations.  The second issue is that storm water, sewer roadway and water infrastructure may relieve some pressure on these topographically vulnerable properties, but the people who are moving to then will have significantly less ability to pay for those improvements, creating a political conundrum that will that a significant amount  of leadership to overcome.  That means that resiliency must be built into infrastructure and redevelopment projects now, to address future conditions.  Building in resiliency is not currently being considered by local planners and engineers because the situation is not well understood and a 50 year planning horizon is not the norm.  Also, it would likely create a firestorm of fuss from developers who would pay the costs, which discourages good planning.

Finally, if things accelerate, wealthier parties may begin to see a retreat from vulnerable eastern beaches to higher ground as being a reasonable concept.  However the high ground is currently occupied by socially vulnerable people, creating a potential area of conflict over the fate of displaced residents who’s social status may force them toward the vacant, topographically vulnerable properties.  This is a future problem for planners, developers and officials approving new development with an eye to displacement a concept not in the current thought process.  Thinking about vulnerability means a lot of infrastructure must not only be constructed, but maintained meaning local public works and utility budgets will need to increase in kind.  That means higher rates and charges to populations that may have limits to their ability to pay   Stay tuned…..


Spring is in the air, at least in some places, so it gives us a chance to take stock of where we are after the winter.  Boston actually is seeing the ground after record snow.  The west is seeing lots of ground, even though some areas should not be seeing ground at this point.  I recall the Colorado Rockies having snow at 8000 ft a couple years ago, but not this year.  Some ski resorts in western Colorado never opened.  Not a good sign.  Snow was 10% of normal in parts of California which means the drought will continue.  12% in Oregon and Washington is some part – not good for places that rely on snow for water supplies.  So the question is whether the current drought is the start of a longer climate driven issues and/or the result of where demands have permanently exceeded supplies?  And if the latter is true, conservation is one option, but has obvious financial and supply limitations since urban use is less than 12% of water total use (agriculture is 40% and power plant cooling water is 39%).

Better management is part of a toolbox, but when the supply is finite, the economics says that costs will increase, shutting out certain sectors of the economy.  This is where the “market system” theory of economics fails large sectors of the population – at some point finite supplies become available only to those who can afford to pay, but water is not one of those commodities that is a luxury – we need it to survive.  Certainly the argument can be made that water is underpriced, but like energy, low water prices have helped fuel economic development while improving public health.  It is a chicken/egg conundrum where the argument that conservation will solve all problems is not realistic, nor is using the market or curtailing economic activity.  This is where the market fails and therefore governments have a role in insuring that all sectors are treated fairly and the commodity can be provided to all those in need of it – serving the public good.  The public good or public welfare argument is often lost in the political dogma of today, but our forefathers had this figured out and designed regulations to insure distribution after seeing the problems that arose in the late 19th and early 20th centuries.  We have forgotten many of those lessons.

The public good or welfare does not mean unlimited distribution to areas that would otherwise be bereft of the commodity.  The early engineers in Los Angeles realized that development could only continue if water was brought in.  So massive water movement projects were developed.  The economic benefit was the only consideration – the impacts of these changes were not considered.  Likewise the Corps of Engineers was directed to drain the Everglades, but no one asked if this was a good idea or would have negative impacts.  Loss of the Everglades permitted economic development that is southeast Florida – 40% of the economy of the state, but it impacted water supply and places millions are risk for future sea level rise impacts.  Worse, agriculture was fostered in the upper Everglades as the federal government sold off the acreage to private interests cheaply to encourage sugar cane and winter vegetables.  That agriculture is now planning to develop the Everglades if the property is not purchased by the state.  But purchasing the property rights a prior error in consequences – it is likely in the public interest as an effort to restore water supplies in the Biscayne acquire that feed southeast Florida, and to increase water flows to retard saltwater migration in the southern Everglades.  These are both ”sins” of the past, made with good intentions but with very little thought of consequences beyond the economic benefits.  Both have resulted in water shortages in the areas they were meant to serve as climate patterns have changed.

The question is whether we continue to make these mistakes.  Development in desert areas, areas known to be water poor, and deepening wells to get groundwater supplies who’s levels continue to decline are all poor long-term decision, despite the short-term potential gains.  California farmers continue to deepening wells but those aquifers have a limit in depth.  Deepening wells means those wells do not recharge (otherwise the aquifer levels would not continually decline).  What happens when the wells run dry permanently? Clearly the sustainability criteria is not met.

Meanwhile lower aquifer can divert surface waters into the ground – not enough for full recharge, but perhaps enough to impact surface water flows to other farmers, potable water users, and ecosystems.  Droughts are climate driven- and we have persevered droughts before, and will again.  However in light of the California drought, perhaps we should all assess more closely the long-term trends – lowering groundwater, increasing demands, lessening availability and make better decisions on water use – not only in California but in many parts of the US and the world.  Changing water use patterns is great, but it is just part of a larger issue — do we need to change our current behaviors – in this case water use – in certain areas?  Are there just places we should not develop?  Is there a limit to water withdrawals?  And how do we deal with the economic losses that will come?  All great question – but do we have the leadership in place to make the hard decisions?


Once upon a time, many years ago there was a young city manager in a backwood town in the south. He had been told he was a bright young man, and had done well in city manager school. He was full of ideas on how to serve the public to make things better for the community and the people in the community, realizing you can’t get rich being a city manager. Getting rich was not his issue – he wanted to help people and thought he could bring his education and ideas to bear on the many problems city’s face. He was also very entrepreneurial – he tried to organize the city to operate like the business that it was by trying to make operations more efficient, providing training to employees that basically never had any, developing mechanisms to track work performed, and updating infrastructure (piping, curbs, sewers, treatment plants). He spent 60-80 hours a week, including countless nights each week at his job, no doubt underpaid. For the most part, the employees bought into his ideas because, well, he never asked them to do something he wouldn’t do, and often would go into the field to work with them on important projects to show them what was needed or what he expected. The staff became well trained and efficient. So far, so good.

Over time he noticed a few interesting trends, but because he was young, he did not have a point of reference to understand them all. One he noticed was that the elected officials always asked for multiple alternatives. But when he presented more than one, he found that the worst option, the one most difficult to implement, or the one that would create added problems, always seemed to be the one chosen. Bad options were like a magnet for these elected officials. So he became more reluctant to present more than one option because doing so made his job much more difficult and, well the point of presenting options that have issues seems counterproductive to good government. Of course that created some friction.

Ok now that you are done laughing hysterically at this young man, keep in mind the story is true and happened less than 30 years ago, so this is not ancient history. It took a few years after frustration and stress took their toll and this young man moved on in his career. City management was just too stressful. It took a few more years to understand that answer to the options riddle – the bad options were chosen because some was lobbying the elected officials for that bad option. Why? Because those lobbying always knew someone who could benefit from the need to “fix” the problem created by that option. So the idealist meets the reality – kind of deflating. He moved on from there.

So how does that affect utilities? Think about your budgets, and especially your capital budgets. Figure out what you NEED to do your job, and then figure out if you have a budget strategy to get it. Do you pad your budget to insure the budget office doesn’t arbitrarily cut your request, because “that’s what they do?” Do your elected officials delay capital projects because it is an election year and they do not want to raise rates? Does the city manager remove the new hires because he needs more money to be diverted to the general fund? Sound familiar? Welcome to the game this young man found so many years ago. 30 years and things definitely have not improved. When you run a business, you know what you need to do the job. You should be able to ask for what you need, and get it without a lot of conflict. Your budget and finance directors should be SUPPORT positions, not gatekeepers. Their job is to find money to pay for operations. You should set the need, and they find the funds, but it doesn’t work that way does it?

The budget battle is a huge expense for every community, and one that largely provides no real benefit but detracts from productivity. None of the game playing helps the utility or the ratepayers, just like the bad options don’t help the community at large either. Yet it is funny that over time, city managers have moved away from people with technical backgrounds in public works and public administration toward people with business experience. The argument is that we need to run the city more like a business, so this should be a good fit. But it is not in part because there is a lack of understanding of the underlying public works services. Public works is a service, not a business. As a result, we see far too much political expediency as opposed to benefits to the payors.

From a business perspective, creating a series of enterprise funds like water, sewer, storm water, roads, and parks is a step in the right direction, but only if those separate enterprises (think companies) can stand on their own. For example, it is completely inappropriate to use your utility to fund the general fund. Borrow from it, yes; some purchased services, yes; huge subsidies, no. When large amounts of funding are diverted, it means that both the general fund and the utility suffer (and for the moment let’s ignore the legal issue if the utility rate base is not the same as the city tax base). Business rarely diverts large revenue streams from other enterprises to keep them afloat for long, so why in government, do business people pursue this path? In the business world, if the general fund was such a loser, we’d cut it loose, or spin it off and make it stand on its own. Ok we can’t really cut the general fund loose (police and fire are in there and we love them), but making is stand on its own is what finance, budget and city managers should be pushing elected officials to do. That would make set up a system of full-cost operations, which will allow residents to understand the true cost of their services, which is completely appropriate. Subsidizing services at the expense of public health is not a good long-term policy is it? . And while you are at if general fund, where are those surpluses we ran to allow us to reduce borrowing for capital projects?

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