CARRBORO -- Ed Kerwin flips through a Power Point presentation, spins the handouts around on the conference room table and points to a chart.
A blue line climbs at a 45-degree angle for almost 15 years, from 1985 to 2001-02. Suddenly average daily water demand falls off a cliff, plummeting from about 9 million gallons to 7 million gallons a day.
OWASA thought once the drought of 2001-02 ended, demand would climb back up. And it did. But sales never matched pre-drought levels. Customers had learned to live with less.
And then the 2007-08 drought hit.
Falling demand is driving double-digit rate hikes this year. After considering a 24 percent increase, the OWASA board could adopt an average 17 percent increase Thursday night.
Already, Kerwin, the executive director of the utility, predicts another possibly steep increase next year.
Demand determines rates because as a public nonprofit, OWASA has to charge customers the actual cost of delivering the service. It can't transfer money from other funds to keep rates low, as do some governments that operate water systems.
And pumping less water doesn't cut expenses much.
If OWASA sells fewer gallons a day, it may save chemical and energy costs, Kerwin said, but not nearly enough to make up for the lost revenue. With most costs fixed -- on personnel, system maintenance -- OWASA has to make the money up somewhere.
OWASA is taking steps to stretch the water supply until a new reservoir comes online in 2030. It's working with the university to use replace drinking water with reclaimed water where possible. It's working with local governments to require "sub-meters" for individual units in multi-family housing because studies show that encourages conservation.
And it's looking at new code requirements demanding even more water-efficient fixtures, such as 1.3 gallon per flush toilets instead of the current 1.6 gallon models.
With lake levels dropping again, however, OWASA also continues to look for options to make sure water pours out when customers turn on the tap. The Haw River might be a temporary fix. Jordan Lake, too, though that could cost $50 million.
At a public hearing two weeks ago, some customers asked whether OWASA was adequately preparing for southern Orange County's growth.
OWASA doesn't control growth, officials said. Instead it has an obligation to meet growth's demands. We wanted to understand that better, so we met with Kerwin at OWASA's headquarters on Jones Ferry Road in Carrboro Monday morning. Here are excerpts from that interview. News:
We're replacing low-intensity uses with more intense development. Look at East 54, Glen Lennox. Are the necessary conversations happening to make sure we have the water to meet growth?Kerwin:
Yes, I think so. Within the last year or 18 months we made a presentation to the local governments addressing the question of density and what does that do to the water supply. If they say this is how we're going to grow, it's our obligation to make sure we have sufficient water and sewer to meet that growth. But clearly it's also our responsibility make sure our elected officials are aware of the cost impacts of various growth decisions.News:
Has OWASA ever said, "Look Chapel Hill, Carrboro, if you do this, this is what it's going to do to water rates?"Kerwin:
When there are small area planning groups, or when Carrboro says this is the density we want in the northern planning area, is there an OWASA representative at those meetings?Kerwin:
Not that I'm aware of.News:
Should there be? Kerwin:
We certainly would accommodate it. Again, we have an obligation. It's not driven by cost. But then again. we want to make sure elected leaders know the consequences of their decisions. But it's also really hard to predict. In the late 1990s I don't think there was any way we could possibly envision we could possibly be selling the same amount of water or less eight or nine years later. If you looked at some of our rate modeling from eight or nine years ago, that's just not how things have panned out. News:
If the drought continues, what are we doing to avoid the worst-case scenario: having to tap the Haw River or Jordan Lake?Kerwin:
Just what the demand is will depend on what the new development will be. OWASA, the towns and county have been working jointly on proposing some additional demand-management measures, such as a landscape ordinance. In the last two or three months each government has said yes, we want such things explored. For instance, we're going to look at, for new development, that OWASA will have the authority to set standards that have to be met to be connected to our system. It may require ultra-low flow toilets. It may require drought-tolerant plants, prohibit spray irrigation for lawn watering. It's still a work in progress. News:
You've been here a long time. Has it gotten more difficult since the drought? Is OWASA getting more criticism? Kerwin:
With 24 percent rate increases, yeah. The first 11 public hearings that I've been a part of we've had one or two people only speak. This year we had 15 people speak. Of the 12 budget and rate cycles I've been through, this by far has generated the most public concern and interest. And certainly we understand why. Is it more difficult? Yeah, it's very challenging. News:
And you don't get to control everything. If the towns decide they're gong to grow, you have to respond. Kerwin:
And if it doesn't rain and there's a record drought, we don't control that either.
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