Birmingham Water Works’ spending on P.R. backfires
When a public utility spends $1 million on public relations while raising rates, it is setting itself up for bad P.R.
The Birmingham Water Works budgeted almost $939,000 for Elements Inc. to provide communications services in 2004, according to The Birmingham News. It exceeded the budget by $281,000, of which half went to Elements. Meanwhile, the Water Works made plans to increase rates by 25 percent over the next 18 months.
Three state legislators asked for a meeting, where board member Jim Lowery explained that the board is spending extra money to offset bad publicity.
"I would be willing to make a deal with the local media that if they would quit spending half of their time criticizing this utility we could probably cut our public relations costs," Mr. Lowery said.
He need not expect the media to keep quiet about rate increases (or questionable spending). They cost customers money, and people want to know about them — the earlier the better, and with details including why they are considered necessary and how they might be avoided. Perhaps by cutting spending on public relations?
Public relations is a questionable use of ratepayers' money if it includes image-building, although it's legitimate to let professionals help get useful information out to the public.
Apparently Elements got behind the curve. Christopher Bazuaye, president and CEO of Elements, said his company was preparing information on the rate increases when the story hit the newspapers. "It became a crisis-management situation as opposed to the pro-active situation it was designed to be," he said. It sounds like he's building a case to support higher fees.
Here's some free public relations advice for public utilities and other public agencies: Freely share information with constituents, through the news media and otherwise. Anticipate and answer the obvious questions, and encourage feedback. Be accessible. Do the best management job you can, and let your image take care of itself.