Cleveland Water is committed to providing great service and a quality product at an affordable price in order to make Cleveland and Northeast Ohio an attractive place to live, work and raise a family. For the past several months, Cleveland Water and the City of Cleveland Heights have been in on-going discussions about the possibility of Cleveland Heights transitioning from a master meter to a direct service agreement. As a result of these discussions, we have received calls, emails and social media inquiries asking what all of this means. We thought it might be a good idea to compile some of the common questions – and the answers – below.
What does master meter and direct service mean?
Cleveland Water provides water to more than 1.4 million people across 77 communities in Northeast Ohio. This service is provided under two primary types of arrangements. The most common is a direct service agreement. Under a direct service agreement, Cleveland Water provides “retail service” to customers including water delivery, general maintenance of infrastructure, and customer service functions, such as meter reading, billing and collections. This is the more common type of agreement with 67 of the 77 communities operating under a direct service agreement.
A master meter agreement is essentially a wholesale water agreement. Cleveland Water sells water in bulk to the community, and then that community in turn provides retail service – including customer service and maintenance – to their residents. Only six communities have master meter agreements: Cleveland Heights, Bedford, Lakewood, Chagrin Falls, Geauga County and Portage County.
The remaining customers have emergency standby agreements with Cleveland Water.
Would switching effect the quality of the water we receive?
No. Cleveland Heights currently purchases water treated by Cleveland Water. Our treatment system and plants are state of the art and provide a reliable supply of water to all of our direct service, master meter and emergency standby customers. Our distribution system, including 15 pump stations, 22 tanks and towers, and 5,200 miles of pipe allow us to deliver safe drinking water to all of our customers – master meter, direct service and emergency standby – with minimal service interruptions. As a member of the Partnership for Safe Water, Cleveland Water holds itself to higher water quality standards than those required by the EPA. We perform self-assessments of our water treatment operations, identify performance limiting factors, and take corrective actions to improve water quality. This large effort ensures that our customers receive great-tasting, quality water with a higher degree of protection.
What’s the business case for changing the agreement?
At Cleveland Water, we believe we provide a great product and a high level of service at an affordable price. The primary motivator for our proposal is not based on business models; rather, it is driven by the movement towards greater collaboration across municipal and regional borders.
It’s been reported that Cleveland Heights is losing 60% of the water they purchase from Cleveland Water, how much water does Cleveland Water lose?
Without knowing exactly how the 60% number was calculated, it’s difficult to make an “apples to apples” comparison. We calculate our water loss using the American Water Works Association Summary of Water Balance model. Specific to the Cleveland Water system, using this industry recommended model, our water losses are approximately 36%. This percentage is driven largely by leakage from aging water mains, tanks and towers.
What have you done/are you doing to combat water loss?
We recognize that there is always room for improvement and continue to attack water loss issues aggressively. We have, historically, been very aggressive in investing in our infrastructure. Over the past 30 years, we have spent more than $1.6 billion upgrading our system. A large portion of this, about $650 million, was spent modernizing our four interconnected water treatment plants. This forward-thinking approach means we have to spend less on those now, and can devote more of our capital dollars to our buried infrastructure which is often forgotten.
Over the next 9 years, we intend to spend approximate $237 million upgrading our water mains. Additionally, we spend more than $50 million annually on the maintenance of our distribution system – this is our terminology to describe our water mains and supporting infrastructure. Beginning in early 2016, we will start a water audit of the entire Cleveland Water system. This will involve inspecting all 5,200 miles of water mains to identify the sources of undetected leaks. The information we receive from this audit will allow us to better target our maintenance and replacement dollars.
How does Cleveland Heights fit into all of this if they become a direct service community?
In terms of Cleveland Heights – if they decide to become a direct service community and sign the Amended Water Service Agreement – they will immediately be eligible to access funds through our Suburban Water Main Renewal Program. Through the first six years of the program, nearly $62 million have been invested in the 30 communities that have signed up. While the minimum annual spending is set at $10 million, we are increasing it to $15 million annually to accelerate improvements.
What are the current water rates and how are they calculated?
Cleveland Water’s current rates can be found here. Our rate structure is cost-of-service based, meaning it includes costs associated with the provision of water service as outlined by our rate studies and water service agreements. Within the Cleveland Water system, we have different rates based on the elevation of our service area. The large pumps located at each of our four water treatment plants can only push water to a certain elevation before water pressure drops too low. Each time we have to use another set of pumps, we create a new pressure zone. These pressure zones determine the water rates a customer pays.
Cleveland Heights is in Cleveland Water’s 2nd High pressure zone. In 2015, 2nd High rates are:
0-0.6 MCF = $30.82 per MCF
Additional MCF = $52.39 per MCF
In addition to the consumption charge, Cleveland Water has a fixed fee based on the size of a customer’s water meter. For most residential customers, this fee is $27 per quarter. Cleveland Water also offers multiple discount programs for senior and low-income customers.
I’ve read about a proposed transition fee, what is this for?
The proposed transition fee would allow Cleveland Water to recover a series of costs associated with transitioning Cleveland Heights from a master meter agreement to a direct service agreement. The proposed transition fee for Cleveland Heights is based on consumption so that customers have greater control over how much they pay. The proposed transition fee is $28.86 per MCF.
I’ve read about poor customer service from Cleveland Water, have things improved?
At Cleveland Water, we are consistently working to improve the quality of our customer service. In 2012, we completed our Customer Service Turnaround Project which resulted in significant customer service improvements, including improved call wait times, more consistent and timely billings, and fewer estimated bills.
Additionally, we are nearing the completion of our Clear Reads automated reading project (AMR), which is dramatically improving customer service. With the new AMR meters – which would be installed in Cleveland Heights – Cleveland Water is providing an elevated level of service to customers including:
Increased self-serve customer service options via an expanded web portal;
Improved access to online bill payment features;
Access to daily and hourly consumption information; and
Courtesy notifications of potential property leaks.
Please feel free to comment below with any further questions.