Following a record year of water main breaks, Kansas City is turning to a retired KCP&L executive to try to turn its struggling water utility around.
Bill Downey, who retired in August as president of Kansas City Power & Light, starts Jan. 4 as a program management consultant for the Kansas City Water Services Department. At a billing rate of $250 per hour, he could make more on an annual basis than any other department director or even City Manager Troy Schulte.
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But Schulte isn’t put off.
“That’s money well spent,” Schulte said, noting that the problems are severe enough that Downey will be worth it if he can help fix them. Downey is expected to help the city address the department’s significant infrastructure, customer service and long-range financial planning challenges.
He is expected to consult with the city for the better part of 2012, at least, and will be paid with water department funds, not general tax dollars.
Kansas City recorded nearly 1,700 water main breaks in 2011 — 25 percent more than the previous high, and 60 percent above average for the last 13 years.
Department officials said weather extremes, combined with the age of the water pipes, contributed to the crisis. As the pace of breaks and water service interruptions rose, customer satisfaction plummeted.
The department has had a revolving door of directors since 2008. Terry Leeds has been acting director for about 18 months, and Schulte said he intends to name Leeds the permanent director.
But Leeds’ expertise is in sewer engineering and Schulte said he thought the department needed guidance from a major utility executive. Schulte had been trying to recruit such an individual as the department director, but couldn’t find one willing to work for the city’s department-level pay, which tops out at $160,000.
Downey was president of KCP&L for nine years, earning $2.3 million in salary, stock awards and other compensation in 2010, according to the company’s most recent proxy statement. He worked for KCP&L for 11 years and before that spent 29 years with the electric utility in Chicago.
In a telephone interview Friday, Downey said he is most proud of the successful completion in 2010 of the massive, $2 billion Iatan 2 coal-fired power plant near Weston. He was also proud of KCP&L’s customer satisfaction and system reliability rankings.
Schulte said Downey has the right skill set to assist the department with improving its day-to-day operations, customer call center and long-range infrastructure planning. The department is embarking on a master plan for rebuilding its leak-prone water system and also must begin implementing a complex, federally mandated sewer overhaul program.
Schulte said the city knows it needs to improve the entire water and sewer service delivery as it embarks on a multi-year series of double-digit rate increases.
“The days of artificially low water and sewer rates in this town are over,” he said.
Danny Rotert, spokesman for Mayor Sly James, said the mayor supports bringing in a large utility expert, even at a significant consulting cost, to help the city create a professionally run water utility.
“He thinks this is a good plan,” Rotert said.