By SYLVIE DALE
ST. JOSEPH, Mo., Aug. 21, 2000 -- A private water company in Missouri is fighting a battle to preserve its public image after its decision to move to a different water source.
When Missouri-American Water Company built St. Joseph's new plant and connected it to a groundwater source, some members of the community were upset about the noticeable change in the new water's taste. Public outrage from some sectors was especially strong because the company has a proposal to Missouri Public Service Commission (http://www.psc.state.mo.us/) to raise customer rates by 53.97 percent or $16,446,277, to be decided in September. This would cover $100 million in recent construction expenses. The St. Joseph plant cost approximately $75 million.
Some of the customers within the service area of the new St. Joseph plant felt that the water should taste better, not worse, considering that they would likely pay more for it very soon, according to reports from the Kansas City Star newspaper. Other customers felt that only the communities that received upgrades or new construction should be affected by the rate hike, according to documents filed with the Missouri Public Service Commission.
But the private water company's position was that the benefits of switching to a groundwater source from the flood-prone Missouri River would eventually outweigh the drawback of harder water, said Lisa Golden, Director of Communications for Missouri-American.
After less than four months and countless adjustments to the treatment process, water from the new source now tastes very much like that of the original source, Golden said.
But in response to a request from the Office of Public Counsel, the Missouri Public Service Commission on Aug. 16 opened a case to investigate the complaints of taste, odor and hardness. A report, which Missouri-American must complete within 90 days, may actually help the utility improve its public image if the results are positive.
To accomplish good customer relations in the face of this controversy, Missouri-American relied upon a tried and true public relations formula which is nevertheless new to water utilities.
The water company will have to show the public why the new plant and new water source was the best route to take, why all of Missouri-American's service area should share in the cost of the St. Joseph plant and how the current water stacks up in terms of quality and safety. In the process, the company will also have to collect comments from the customers and implement the new ideas successfully.
Changes in the water
Tests from the local regulatory agency showed that even though some objected to the change in taste, St. Joseph's drinking water was safe and met all standards. And some customers didn't mind the taste at all.
The issue that hovered over the water company's head was one of customer satisfaction. The new water source, from a newly tapped aquifer, was harder than the original source. To customers, it tasted different.
"Taste of water is something you grow very used to in your community," Golden said.
"No matter what the change is, the fact that it's a change puts people on alert. It's hard to describe how taste of water affects people, but when you've been supplying a product that tastes one way for a hundred years in a community, then any change in it is going to be noticed by the customer."
Before the new plant was built, Missouri Water officials were looking for a way to make the plant compliant with new national regulations. The company already was planning a $30 to $40 million upgrade of the old plant, located next to the Missouri River. But the 1993 flood caused the company to change its plans.
Rather than trying to flood-proof the old plant, Missouri-American built a new one on high ground. Also, to avoid intake problems as water levels vary, aquifers 120 feet below the riverbed were tapped with a series of wells.
But the water in those aquifers has been trapped for thousands of years and has a greater concentration of dissolved minerals such as calcium than river water.
But although the Missouri River had relatively hard water with a calcium content of 250 to 350 ppm, the aquifer's calcium content was over 400 ppm - a difference in taste customers would be sure to notice.
Missouri-American officials expect the calcium level to drop as older water is pumped out of the aquifer and newer water filters in. At some point, the water should be only slightly harder than before, Golden said.
The advantages of using groundwater, including a more reliable source, lower filtration requirement, more constant temperature and less pollution from runoff would in time far outweigh the drawback of harder water, Golden said. So the company went ahead with the change. The water treatment plant began delivering water from the aquifer in April.
Sure enough, as soon as the new plant started operating, complaints rolled in about the new water's taste.
Newspaper articles criticized the change and stirred questions about water safety. Some customers complained about the harder taste and the spots on the dishes in the dishwasher.
There were reports about a film on the surface of hot drinks such as coffee. Some people said the water had an unpleasant smell to it.
One family was so worried about the water's new taste and odor that they started buying 10 gallons of bottled water per week, according to the Kansas City Star.
Missouri Public Counsel Martha S. Hogerty was not sure Missouri Water's decision to build a new plant was a right one. Hogerty is the state's consumer advocate for utility regulation. In testimony filed April 3 with the Missouri Public Service Commission, the Office of the Public Counsel said the company could have realized substantial savings by upgrading and increasing the capacity of the existing plant. Because of that, Hogerty said, only $29.2 million should be included in the calculation of water rates.
"Ratepayers should not have to pay for this imprudent decision to plunge headlong into the construction of new facilities without the benefit of detailed engineering studies regarding the feasibility of flood-proofing and upgrading the existing plant at its current location," said Hogerty.
Perhaps the timing was a factor in the difficulty Missouri Water had -- its rate increase proposal, with a decision expected in September, would raise rates by 53.97 percent for most of the communities it serves in Missouri.
This proposal has met with opposition from a consortium of other cities, consumer groups, other water utilities in the area and big industrial customers.
An editorial written Dec. 10, 1999 in the Joplin Globe applauded the Joplin city council for agreeing to join the consortium of cities against the rate increase.
"The water company's argument is thin," the editorial stated. "The company contends Joplin ratepayers should pick up the tab because city customers might need a new system someday, too."
Missouri-American Water wants to raise the rates for all of the areas it serves under its uniform rate schedule, which helps offset upgrade costs to any one utility. The company may set rates, with PSC approval, at the same level for all of its Missouri customers.
Informing the public
With Missouri Water responded to customer complaints and news stories by sending out direct mail and working with the media. The company was trying to communicate the message that it was listening to its customers' complaints and that the water was still safe.
"There are a lot of advantages to the water supply that they're receiving now that weren't there before, but the immediate concern is that it's different," Golden said. "So the message that we tried to send is, 'Yes, it's different. The source water is different. But that it's still a quality product and for those aesthetic qualities that they are concerned about, we are certainly working on using our expertise to find ways to make people satisfied with the way the water tastes and smells as well.'"
One of the direct mailings described the new disinfectant, chloramine, and how it works to disinfect the water. Chloramine, a blend of chlorine and ammonia, leaves less of a taste in the water and was part of the company's effort to improve the flavor. The company also wanted to inform dialysis patients and customers with fish tanks about the differences between chloramines and chlorine, because water treated with chloramine disinfectant cannot be used in dialysis machines.
Missouri-American put out releases through the media that explained the water was different but still met water quality standards, Golden said.
The message was intended to let people know that the company was continuing to optimize the treatment plant operations to address the aesthetic issues, Golden said, but in the meantime, there certainly were no safety issues.
The company also held hearings to gauge public opinion and offer answers to some of the customer's questions.
The company informed the customers that the water could be softened with lime, but there are disadvantages to lime softening as well. If lime is added at the plant, a residual is created that either is discharged back into the environment or landfilled. Since some people don't like the taste of softened water, Golden said, residents were told they could install their own water softeners in the home.
Lessons learned
Cultivating good customer relations is a topic which is coming to the forefront of the water industry with the growth of privatized operations. It is a topic which is coming up more in workshops and conferences.
Missouri-American is just one utility among many that are using public relations techniques to promote good relationships with their customers. The company learned in particular that an open and honest attitude is often the best strategy in any situation.
"An educated public is our very best friend," Golden said. "Someone who understands water treatment and the issues surrounding water treatment and what it takes to produce quality water is certainly an ally to the water industry, and can help form good solid regulations for industry. I think that's a good trend for us."
In the water utility industry, it is often only after a utility must act to comply with regulations that the public becomes alerted to the fact that the requirement exists, Golden said. That's something that challenges both municipalities and investor-owned utilities.
The company is not out of the woods yet, but by all accounts, it has done quite a bit towards regaining customer satisfaction.
"What we've learned is that you can't be defensive about a matter like this. It was easy for us to say this is quality water and it meets all the standards, but you want to give your customers a product that not only meets those quality standards but also is pleasing for them to use. This is something for them to ingest; water is very personal.
Despite the fact that there are some people who never had an issue with the taste of the water, certainly you want to take very seriously whatever percentage of customers are not happy with it. And so through a combination of an education process and a process of optimizing your treatment of the water, you want to make customers happy. And that's kind of what it's all about."
