Trying Times: Municipal Water District Comes Back from the Brink

Developing a strategic plan helped struggling water district find focus, stabilize operations and improve service.

Trying Times: Municipal Water District Comes Back from the Brink

Chris Hand vacuums debris from a lift station while doing routine maintenance for the Rainbow Municipal Water District. 

California’s Rainbow Municipal Water District is a vibrant utility serving residential and agricultural customers an hour’s drive north of San Diego. It’s a far cry from 2013 when the district almost ceased to exist, a victim of high staff turnover, board instability, a lack of direction, and a hostile takeover attempt by a neighboring agency.

Tom Kennedy, general manager, credits the development of a strategic plan as the center plank of an effort that brought the district back from the brink.

The Rainbow Municipal Water District was established in 1953 to serve unincorporated communities that include Rainbow; Bonsall; Pala; and portions of Vista, Oceanside, and Fallbrook. Like many water districts, it provides only water supplied from outside sources. About 65 percent of water is supplied to agribusinesses, such as plant nurseries and avocado farms. However, the residential population of 20,000 is booming as a thousand new homes are coming to market in 2018 and another 2,500 are in final planning stages.

“That’s the biggest transition in the district,” Kennedy says. “Where once we were supplying raw water to the groves, it’s now shifted to producing potable water for residential users.”

However, residential users consume less water than the agricultural customers they replace, while existing agribusinesses are becoming increasingly efficient. That’s driving down water sales and putting a strain on district revenue. Whereas 15 years ago the district supplied 35,000 acre-feet of water annually, it now projects sales of fewer than 15,000 acre-feet. Finding efficiencies helps to mitigate rate increases.

The distribution system includes 320 miles of water pipe, 13 water tanks, three reservoirs and 70 pressure regulating stations across a challenging topography ranging from 25 to 200 feet in elevation.

High-Pressure System

“We run a lot of pressure to get the water through the system,” Kennedy says. “Much of the system runs at 200 psi, but it reaches 400 psi. When you have eight customers on a mile of transmission main, you have to find ways to mitigate pressure. We have about 1,200 regulators installed just to make sure our water meters don’t blow up. High pressure is a mixed blessing because if we experience a leak, we know about it quickly — a pinhole turns into a roar pretty quickly.”

About 85 percent of the system is concrete-lined welded steel. There’s a little asbestos cement, but new residential developments are serviced with PVC pipe. The largest transmission mains measure 42 inches in diameter, while the smallest measure 4.

Kennedy says the distribution system is in good shape. “We’ve narrowed down the areas most likely to break by correlating them with higher pressures, age, topography and corrosive soils,” he says. “About 80 percent of leaks occur in 20 percent of pipes. Also, the build quality of certain installations isn’t where it should have been. Contractors didn’t mud the joints, so while the pipe is great, the joints are weak.”

A small sewer system transports wastewater from new residential developments to a treatment plant in Oceanside. Much of the system is newer PVC with a small amount of vitrified clay. Pipes range from 6 to 18 inches in diameter. 

“It’s a newer system. Knock on wood — we’ve seen very few issues,” Kennedy says. 

Doing It In-House

In-house crews handle many sewer and water construction and repair jobs, with larger scale work contracted out.

The district owns a Vac-Con combination truck and cleans the sewer system every two years, with extra attention paid to problem areas. Valves are exercised on a two-year schedule. Pump stations and backup generators are inspected and maintained weekly.

The district uses Infor enterprise asset management software that is integrated with GeoViewer by Nobel Systems to coordinate crew activity. The integrated software system delivers asset management, GIS information, vehicle tracking, dig alerts and customer service software into a single app. That provides iPads with near-instantaneous field access to information that includes as-built drawings, aerial photographs and worker-captured images.

“Our fleet travels half a million miles most years,” Kennedy says. “Efficiency is about managing work orders from our construction crews and marrying them with our wastewater crews, our valve maintenance crews and our customer service people. By getting all our people mapped, we can dispatch crew members to the nearest service call.”

High Turnover

In 2014, Kennedy became the district’s 45th general manager. “The tenures were always short,” he says. “There was also instability at the board level, and employee turnover had been running as high as 40 percent.”

The Rainbow Municipal Water District was also in the middle of an existential crisis. The district had entered into a joint partnership agreement with a neighboring district to share staff and equipment. The previous Rainbow Municipal Water District general manager had retired, and the manager of the neighboring district had been temporarily overseeing Rainbow operations.

“The other district wanted to formalize a merger, while Rainbow favored the JPA,” Kennedy says. “The other district then applied to the county’s Local Agency Formation Commission to dissolve RMWD and force a consolidation.” 

After a 14-month effort, Kennedy and district residents averted the forced merger. 

“In part, that issue was the result of decades of political instability and lack of critical focus on the part of RMWD,” he says. “If we were to respect the fight our ratepayers made to prevent the district from being dissolved and to demonstrate that we were capable of being a properly functioning organization, we needed to have a common vision of who we were and identify our common values and what we were doing.”

Building Consensus

Kennedy wanted the strategic plan to emerge from a consensus of stakeholders, rather than be driven from the top down.

The district contracted an outside facilitator who identified four steps to create the plan: planning to plan, analyzing the situation, setting a strategic direction, and completing and monitoring the plan. 

1. Planning to plan

The district identified all stakeholders using the broadest brush possible. These included board members, employees, managers, ratepayer groups and the public. The district also appointed a leadership team made up of management and employees.

2. Analyzing the situation

The process began with a series of questions: What are our strengths? Our weaknesses? What are the most important short- and long-term priorities? What do you want the district to be known for in the community? It also included a SWOT analysis, identifying strengths, weaknesses, opportunities, and threats.

“We interviewed board members individually,” Kennedy says. “Employees were consulted in randomly selected groups to avoid having them participate with co-workers or people with the same job description.”

Public input was sought at community meetings and open board sessions.

“We wanted to hear everything — even if it was just anecdotal or seemed wacky — on the belief that the best ideas would distill out,” Kennedy says. “We would put all ideas on sticky notes and whiteboards to find commonality. If we weren’t aligned, we would hold further sessions to see if we could clarify the disagreement, but if those differences couldn’t be ironed out, the view of the board would prevail. We were fortunate to get a pretty good consensus.”

3. Setting a strategic direction

The district defined a concise mission statement that answered three questions: Why are you here? Who do you serve? How do you conduct yourself? The result:

“To provide our customers reliable, high quality water and water reclamation services in a fiscally sustainable manner.”

The leadership team identified six areas of strategic focus that would help set direction: water resources, asset management, workforce development, fiscal responsibility, customer service and communication. Each area offered a goal and some simple annual objectives. For example, under “water resources” in the first strategic plan, published January 2016, the district pursued additional groundwater sources to supplement water purchased from outside.

The district also identified a list of core values and a brief description of how each would be exemplified: integrity, professionalism, innovation, responsibility and teamwork.

4. Completing and monitoring the plan. 

The leadership team wrote the final strategic plan with the assistance of the facilitator, keeping it short and easy to read.

“The strategic plan isn’t just a document that you file away,” Kennedy says. “It’s a living document that we refer to daily and update annually.”

The district reports to the board on its objectives every quarter. Any new proposals are first filtered through the strategic plan before further consideration.

“If a board member asks us to pursue a certain initiative, we measure that against the strategic plan,” Kennedy says. “For example, in making asset management one of our strategic focuses, we choose long-term or permanent solutions that are installed cost-effectively.”

The district reassessed the strategic plan in June 2017 and updated some strategic objectives.

“We thought recycled water was going to be a great idea for the district, but our study demonstrated it wasn’t going to be cost-effective,” Kennedy says. “Each year you need to pivot a little on your objectives.”

Not only has the strategic plan given the district a sense of unified purpose, it has given Rainbow a sense of continuity.

“The water distribution system will be here long after we’re gone,” Kennedy says. “The strategic plan confirms that our job is to be good stewards of that system so that we can hand it to the next generation in good condition.”

The currency of excellence

The Rainbow Municipal Water District developed its first strategic plan in 2016. It’s also developed a coin program that rewards employee excellence against the values outlined in the plan.

“We’re located next to the Camp Pendleton Marine Corps Base, and some of our employees have been part of the military,” says Tom Kennedy, general manager of the district. “One of our managers who is also a reservist suggested we establish an excellence coin program of the type used by the military.”

All employees, board members and district volunteers receive the district’s Excellence Coin, which bears the district’s values, focus areas and mission statement. Each month, employees are nominated and awarded coins representing each core value — and a gift card.

“The coins symbolize our shared participation as a group,” Kennedy says. “They’re also a tangible representation and reminder of our focus areas and values.”


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