ANXIETY

It goes without saying, but still worth saying, that COVID-19 has created unprecedented anxieties on all levels of society and in all world societies. The pandemic offers no exception or reprieve to water utilities and their obligation to provide safe and adequate water to their customers no matter what. There are no furloughs, or quarantines, or shelter in place in homes for water operations and their operators.

A prime anxiety facing water utilities today is concern over staff. How do you keep staff safe and what do you if they become ill? Many water utilities generally do not have a surplus of personnel, particularly qualified or specialized personnel available to replace a key employee who becomes ill with the virus. Utility personnel are not necessarily fungible, particularly when certain positions are licensed or require expertise such as accounting or engineering.

COVID-19 also can create financial anxiety for water utilities. When customers become unemployed, or businesses become shuttered, water bills tend not to be paid on time or at all. Obviously, revenue shortfalls can adversely impact a utility, particularly a smaller one, hindering the ability to pay employees and bills. Revenue shortfalls also create the risk of default on debt obligations, such as revenue bonds.

Anxieties, however, can offer a learning experience for the future. For example, a water utility may be able to negotiate a mutual assistance agreement with a nearby utility. In the event that one party suffers an employee on leave with illness, it may be able "borrow" an employee from the other utility even part-time to replace the missing staff member. Anxiety over financial concerns demonstrates the importance of creating financial reserves. The "rainy days" for which reserves are created are not just for replacement of worn widgets. They can help mitigate unfavorable operating climates.


© 2020 Daniel J. Kucera