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5.05 American Executive Magazine Corporate Spotlighte M.U.D. not only supplies Omaha with water and natural gas, it does it at enviably low prices. Metropolitan Utilities District started life as the Metropolitan Water District for Omaha when the Nebraska state legislature created it in 1913. A few years later, MWD's name became M.U.D. with the acquisition of a bankrupt Omaha gas system. The commission is the only metropolitan utilities district in Nebraska and the fourth largest public natural gas utility in the US. M.U.D. is an 800-employee political subdivision and public corporation of Nebraska, and it refers to its customers as customer-owners. Adopting this nomenclature, it provides natural gas service to more than 197,000 owners in the metro- Omaha area, as well as water to more than 183,000. The customer base is expanding by about 3,500 per year. Remarkably, M.U.D. provides natural gas at rates not only lower than a local, privately held competitors, but lower than any other gas supplier nationwide. President Tom Wurtz is on record as welcoming competition with other suppliers in communities, such as Omaha suburb Bellevue, where both M.U.D. and privately-held suppliers provide service. Water rates are similarly low. The average residential M.U.D. water consumer pays less than $170 annually (about what Boston residents pay for three months). Wurtz became general manager in 2001; his title was changed to president last year. He joined M.U.D. in 1980 as an attorney in the utility's law department, having taught law and, as a young assistant director of legal aid in Lincoln, successfully argued two cases in the US Supreme Court. "Lawyers make good managers," Wurtz said. "We're trained to analyze problems in a disciplined manner." Subjects for analysis have not been lacking since he rose to the top position. Reviewing the 2002 budget, he trimmed $1.7 million to ensure that there would be no increase in base natural gas and water rates. New scrutiny, new savings Since the beginning of Wurtz's tenure, management has undergone thorough scrutiny, as has the commission's supply chain. A recent gas transportation contract, competitively bid by two pipeline companies, will net more than $45 million in savings over the 10-year agreement and provide natural gas at a 23% annual savings compared to previous charges for natural gas transportation. "I'm a strong supporter of publicly owned utilities," Wurtz said. "My goal is to make sure this utility survives and continues to be efficient and competitive." Wurtz said he treats the customers' money as if it were his own. "When you analyze every dime as if it were your own, you can't help but deliver an efficient product," Wurtz said. "Investor-owned utilities have to divide their focus between stockholders and customers. In contrast, most of what is done by publicly-owned utilities like M.U.D. will be done to maximize shareholder returns." With a publicly-owned utility, Wurtz said, customers have a say in how the utility is run through elected board members or attendance at public meetings. A publicly-owned utility employs local residents, friends, or relatives who care about the community as much as the utility consumer does. In addition to normal business management initiatives, Wurtz, having taken the reins three months after 9/11, has spent plenty of time analyzing security issues. "Municipal infrastructure is an identified terrorist target," he said. "I work on security almost every day." Last year, the utility spent nearly $900,000 to update security equipment and procedures. Plenty of push back No stranger to controversy, Wurtz also oversees the means for continually increased supply. M.U.D. still takes most of its water from the Missouri River, but a new, $311-million water wellfield along the Platte west of Omaha is underway. Because wells take land-not much, but enough to rile property owners-and potentially impact subsurface aquifers, farmers in particular are unhappy with the plan. "The unhappiness may be more of a NIMBY [not in my back yard] thing than an actuality," Wurtz said. "We're unlikely to draw water to the point where agriculture is damaged. Our rate payers wouldn't stand for it, because we'd be liable, and we'd have to pay." In common with many utilities across the US, dealing with aging facilities takes a fair mount of Wurtz's time. A new water treatment plant is part of the new wellfield project west of Omaha. Scheduled to go online in 2008, the facility will add more than a million gallons per day capacity. "It should meet the water needs of the metro and adjacent community for the next 75 years," Wurtz said. "There's been a great deal of growth in the Omaha area," said a M.U.D. spokesperson. "Our responsibility is to supply safe water to the growing metropolitan community." Still, local residents, some of whose families homesteaded the land five or six generations ago, remain concerned. That said, one key to M.U.D.'s success is community outreach, which ranges from programs for financial help for people having difficulty paying bills to facility tours to a large collection of community education resources. The latter draws from nearly 20 videos and speaker programs, many of which were produced by M.U.D. and can be checked out of the Omaha Public Library. There is a 50-page new customer guide that provides unusually comprehensive information about how M.U.D. operates, safety information about gas furnaces and appliances, a clear delineation of what belongs to M.U.D. and to the home owner, and more. Finally, the community benefits from the new water project as well: the work is being handled entirely by local contractors. Ultimately, Wurtz said, M.U.D. must motivate its employees to work as productively and efficiently as possible. Along with some of the lowest rates in the Midwest, it continues to streamline its staff. Where 25 years ago, M.U.D. had 3.15 employees per 1,000 customers, today it has 2.12. "I'm privileged to lead a company with a good reputation," Wurtz said about his time at the utility. At the same time, he said, despite the challenges, "It's fun. There is real satisfaction in providing good service at low cost." Dave Gehman is a Massachusetts-based freelance writer specializing in high tech and organizational dynamics. He can be reached at dgehman@rcn.com. |
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