Fewer utilities can go it alone these days. Utilities find that the costs of identifying, permitting, and developing new water supplies and the new or expanded treatment and pipelines necessary to get that water to customers have grown exponentially.
Currently, federal funding is abundant, but it’s not enough and won’t last forever. In the old days, shovel-ready projects, usually from larger utilities, had a competitive advantage when federal funding was available.
Small & Rural Utilities
Now, there are steps that smaller and rural utilities can take to get the funding needed to serve their customers. The good news is that there are specific set-asides for small and rural systems in the current funding opportunities. Better still, money from various grants and loans can often be leveraged to achieve total funding or something close to it. Finally, competitive positions can be enhanced by collaborating with other small and rural systems. The old days of competing for funding and water no longer make sense.
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The Governmental Utility Authority (GUA) Approach
To foster successful collaboration with small and rural utilities, we have developed a collaborative approach called Governmental Utility Authority (GUA). We know it works well because we established the Florida Governmental Utility Authority (FGUA) in Florida. The FGUA operates 97 systems in 14 counties serving 120,000 customers and has existed for decades. The member utilities don’t have to turn the facilities over to the FGUA, though some do.
Over the years, governments have opted in and out of the FGUA. The interlocal agreement secures the relationship and the terms of engagement. The board is comprised of senior staff representing the member governments. Not all choose to seat a board member, though all are invited. The organization does not have a full-time staff, and management is accomplished through contracts for everything from system maintenance to billing and all other management functions.
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This approach can be replicated, and Texas is looking closely at the GUA approach for all the right reasons. Like Florida, they have dozens of small and rural systems that need infrastructure repairs, new water supplies and technology, staff training, and system management. New state and federal grants can be leveraged to acquire critical technical assistance, and a GUA makes small and rural utilities more competitive.
However, that money can be out of reach for small and rural Texas communities even though funds are specifically set aside for them. The good news is that The American Rescue Act funding can be used to get the necessary critical technical assistance.
It's not all good news, but it is a good start to ensure that small and rural utilities can get what they need without the consequence of customer rate shock.
FGUA site information: www.FGUA.com
Visit waterworks4texas.com today to learn more.