Abracadabra

Keep your eye on the bouncing ball. The common principle of both magic and marketing is misdirection. Look here, not there. Get your audience to look away from the grift, and they will be convinced the impossible is real. It’s magic. And marketing.

Among the most common misdirection tricks is to change the denominator. Your favourite cereal has a new lower price. But what you may have failed to notice was the box got a bit smaller. You paid more for your breakfast flakes, but you felt like you got a bargain. Marketers change the denominator regularly. Utility operators should shy away from such practices.

Last week, a team of bright young folks from Shire Hall made a pitch for higher waterworks rates over the next ten years. The publisher of this newspaper and this columnist comprised a quarter of the viewing audience, if you believe the Zoom tally of eight participants. There tends to be low interest in waterworks among County residents. That’s a problem. But we shall leave that for another day.

Prince Edward County waterworks consumers have among the highest bills anywhere. And they will spiral ever upwards until there is some back pressure from the users of the system. Before 2003, many water customers paid a fixed rate that averaged $250-$300 a year. But by 2004, most households had a water meter fitted to their water systems, and average bills started rising quickly—even as water usage declined precipitously.

By 2007 Shire Hall—the operator of the waterworks utility—concluded they had to start marketing the perpetually increasing cost of running this business. A long series of public missteps, including tearing up Consecon’s water deal with Quinte West and the debacle surrounding the planning for Picton wastewater treatment plant, meant that users were getting uneasy with the stewardship of this utility. Shire Hall needed their customers to stop looking at the percentage cost increase each year.

So, they introduced a denominator. You can tell a denominator-based sales pitch; they tend to go along the lines of “for a cup of coffee a day, you can have x, y or z.” That year Shire Hall shifted the discussion from the percentage increase to the impact on the average household. This would be more palatable. Look here, not there.

To do this, they dug up a report from Durham that said the average household used 273 cubic metres of water per year. Using this measure Shire Hall said the average household bill for waterworks (both water and wastewater) was $949 in 2007.

This approach had the unintended consequence of highlighting the exorbitant costs of water and wastewater compared with other municipalities. Cobourg paid $467 that year for their average waterworks usage. Durham $522. Belleville $740.

So they changed the denominator.

By 2011, the average household water consumption, as it was presented by Shire Hall, inexplicably fell from 273 m3 to 124 m3. Presto. Chango. It made the average waterworks bill appear lower. But in reality, the cost of this service was still rising rapidly.

In current presentations, the denominator has been adjusted down again, slightly, to 10 m3 per month—or 120 m3 annually from 124 m3. No explanation. No grounding for the change in denominator. A small change perhaps, but there is no historical context. Or bearings. No way for consumers to compare apples to apples. When the denominator is a moving target, we can’t easily compare our bills to other places or last year. We don’t even know what is comparable.

In lieu of an authoritative source, I offer a rough historical comparison using 124 m3 consumption as my benchmark. In 2004, the average bill for this amount of water and wastewater treatment would have totalled about $325 for the year. By 2015 it had risen to $1,298. This year it is $1,893. By 2030 it is projected to be about $2,390.

This rate of persistent increase has an impact on families and the marginalized folks in our community. It makes the County a bit less affordable each year. Shire Hall’s credibility requires that they be straight with the folks paying these bills, and those barely hanging on.

Here’s the thing: these are good folks. Smart, capable and eager. They are encouraged to stop selling.

Instead they are encouraged to: explain, present the pressures, the challenges and opportunities. Lay out the facts as best you know them. Articulate an argument. In a simple way, in plain English. (We ought not hear from the director of finance speculating about what other municipalities might or might not do in the future. It is spin, and it undermines credibility. Besides, the very same arguments were made about development charges in 2009— and that prognostication proved profoundly wrong and harmful to this community.)

Leave the marketing and spin to your comms guy. He is a smart and capable resource. There is a time and place for a waterworks utility to market its plans and services. This is neither.

Operations and financial folks don’t colour outside the lines when they report to regulators—they shouldn’t do it with customers and shareholders.

To be clear: This isn’t a competence issue. It is a training and expectations gap. The message should be coming from the governors (Council) through senior management. Argument 317 for an independent waterworks utility authority.

rick@wellingtontimes.ca