Why should the utility worry about the cost of pipe breaks that don’t affect the utility? For example, blocking traffic.
This came whenever we have the earlier discussion about the cost were associated with the water line breaks in LA, and so you know you’re talking about the various costs that were associated with that water line break. And so the question is, “Why should the water utility worry about the costs that don’t impact or have a direct impact on the water utility specifically.”
That’s, it would certainly vary from community to community but many communities actually have to pay for the services. So in the case were the community has to pay for that, which does happen in many cases at least for bigger cities, where if you’re having to call in folks, you are going to put up traffic barricades and you’re going to have to pay police or to go out and direct traffic or if there’s a road repair, often times utilities might even have to pay for some of that road repairs. So in that case, it would tie to the utility.
If there’s a case where the utility does not have to pay those cost, I would not ignore them even though there are not tied directly to the utility because the utility has still created that expense for the community as a whole.
And I think one of the things once you start getting into infrastructure asset management is start looking a little bit more holistically around the cost and even though they might not be accruing to your particular authority, that’s still a cost that’s occurring to your community, one way or the other.
So that’s money that could have been spent out when you’re doing something productive is getting spent on an emergency.
And if you would look at say a road budget, maybe the community has a road budget of, let’s just pick a number. If you have a $500,000 road budget for the year, and if they have to spend $250,000 on that budget dealing with road repairs from pipe breaks, that’s a $250,000 that they could have done another project.
Maybe there was a street lighting or sidewalk improvement or something else that they were trying to do. So I think we need to be really careful about saying that if we’re not directly paying for it, it doesn’t matter. I believe that those costs still matter to the utility.
The utility should still consider them even if they’re not directly the bottom line of that utility because somebody has to pay for it and ultimately your customer base is probably that somebody because you’re going to have to pay the taxes or fees or something that will pay for the services elsewhere.
So even if they’re paying for other public services like police or barricading or road repairs, they’re paying for it somehow, someway. It’s not coming out of the sky. It’s coming out of those pockets.
PHOTO CREDIT: Water Main Break Floods UCLA by Carlos Espinosa