2014 REPORT TO THE COMMUNITY

One of 9 national Sustainable Water

Utility Management Award winners*

*Presented to CWW by the Association of Metropolitan Water Agencies for balancing innovative, successful efforts in economic, social and environmental areas with cost effectiveness.

Sustainability...“A program, development or project that meets the needs of the present without compromising the ability of future generations to meet their own needs.”

It has been my pleasure to serve as a member of the Board of Water Commissioners since 2007 and as Chairman during 2014. I am honored to have been a small part of an organization with a rich history dating back to the early 1900s. Former commissioners, leaders and team members have left a strong legacy, which is a true gift to all of us. The current team is building on that legacy, ensuring a bright future for Columbus Water Works and a positive impact on our community.

This team is dedicated to excel-lence in everything they do and has been recognized repeatedly for a focus on customer service, dedication to strategic planning, pursuit of innovation and commitment to remaining one of the lowest cost providers of water in the Southeast. Underscoring every endeavor is the protection of the most valuable natural resource in the area—the abundant waters of the Chattahoochee River.

Readily available, high quality water is essential for a healthy and prosperous community and CWW embraces the respon-sibility and takes pride in providing that. I wish these highly qualified, motivated professionals continued success as they maintain our current system and pursue new opportunities, innovations and strategies that advance our community and the quality of life for our citizens.

Billy BlanchardChairman

Dear Customers and Stakeholders, The Chattahoochee River has sustained Columbus’ water needs throughout her history. From early priorities for industrial power and navigation to today’s need for drinking water, wastewater discharge and recreation, sustainability of adequate flow has been critical for the Columbus/Fort Benning region.

Currently, two actions are underway that can affect river flows through Columbus for future generations. They are: (1) the Florida- Georgia lawsuit in the U.S Supreme Court and (2) the U.S. Army Corps’ revision of its water control manual. Water management and allocation decisions are expected from both in early 2017.

Columbus Water Works continues to assert to both parties our need for sustainability of historical river flows. Since 1975, the river system and Corps’ management has consistently produced a minimum daily flow of 1350 cubic feet per second. In order to ensure a sufficient and reliable water supply for future generations, Columbus is requesting that no less be included in the Corps’ water control manual.

Now and in the future, CWW strives for excellent customer service and environmental stewardship by providing high quality drinking water and discharging environmentally safe, treated wastewater without significantly impacting the quantity or quality of water in the Chattahoochee.

Sincerely,

Steven R. DavisPresident, Columbus Water Works

Left to Right Standing: Gwen Ruff, SVP Division of Employee Services and Strategic Planning; Joey Murphy, SVP Division of Customer Service and Finance; Billy Cobb, SVP Division of Communications, Engineering and Field Services; and John Peebles, SVP Division of Water Resource Operations.

Left to Right Sitting: Emory Blount, Executive Vice President and Steve Davis, President

BOARD OF COMMISSIONERSSENIOR MANAGEMENT

Left to Right: Karl Douglass, Reynolds Bickerstaff, Mayor Teresa Tomlinson, Billy Blanchard and Dr. Carol Rutland

Cover photos: Jim Cawthorne Camera1

Rehabilitation and Renewal of Infrastructure Being FundedOne critical component in maintaining sustainability is the CWW Capital Improvement Plan (CIP). The plan for the next five years was designed throughout 2014. The list of 70 projects, costing $98 million, was developed using a rigorous process. The CIP is based on the com-pany’s strategic goals, which are weighed and balanced against economic, social and environmental impacts. Using a prioritization tool, the projects are ranked and those that rose to the top involve the repair and replace-ment of aging infrastructure. The priortization is required in order to have a financially sustainable program.

Strategic planning sets benchmarks and tracks attainment to sustain the organization CWW has been successful in providing the highest quality of customer service today and into the future as the result of the emphasis on strategic planning at all levels. Six employee teams followed 27 benchmarks and reached 82 percent of the goals during the 2014 fiscal year. These measurements guide company achievement and determine what areas need more attention. For instance, safety was determined to be a critical need and additional safety programs and training were implemented. As a result, training is increasing and the safety record is improving.

Innovative Technologies Produce Efficiencies Sustaining the SystemsZAPS, a new testing instrument piloted by CWW, now provides real-time measurements of the chemical and biological parameters in the river. Now hundreds of readings are taken locally each minute and reliable data provides an early warning of anything out of the

normal range. This allows for better control of water quality and costs.

Automatic meter reading has now been installed in 51 percent of the system. The equipment uses radio frequencies to communicate meter read data without physically examining the meter. This allows meter readers to merely drive by—saving time and money.

Sustaining the workforce and the community In order to sustain CWW leadership, training continues and additional development programs such as servant leadership were introduced this past year. CWW employees also support the well-being of the Columbus area through involvement in United Way, Oxbow Meadows and Partner in Education programs. The United Way goal was exceeded once again with our employees’ contribution of $74,556.86 with 100 percent participation. A new rain barrel workshop instituted at Oxbow Meadows and supported by CWW helps participants save water and money.

Careful planning ensures personnel, financial and infrastructure sustainability

CWW was one of 9 water utilities nationwide to

receive the Association of Metropolitan Water Agencies

Sustainable Water Utility Management Award which

recognizes excellence in customer service,

environmental protection, economic development and

public health.

CWW facilities were recognized with 36

awards during 2014. In addition, several employees were

recognized by the AWWA with top awards: Becky

Butts, outstanding service; Lynn Campbell, meritorious achievement

and Carl Corley outstanding GAWWA

water treatment operator.

SUCCESSSTORIES

2007 20112009 20132008 20122010 2014

Met

er C

hang

e-O

ut/A

utom

atic

M

eter

Rea

ding

Pro

gram 12,000

8,000

14,000

10,000

6,000

4,000

2,000

0

2,583 2,6692,815 3,275

4,6025,403

7,631

12,840

Meters Replaced per Calendar Year

Reducing Energy UseThe Fats Oils and Grease (FOG) recycling program not only helps to keep these materials from clogging sewer pipes, it is being used to help power the South Columbus Water Resource Facility.

In addition to biannual, public collection events, CWW implemented two stationary 24/7 recycling sites during 2014. The collection bins at 1335 Alexander St. and 3001 South Lumpkin are already showing significant use.

One of the most significant reductions in our carbon footprint comes from the CBFT3 system at the South Columbus Water Resources Facility. It produces 250,000- 400,000 cubic feet per day of methane which is used to co-generate heat and power. Improvements and introduction of FOG has increased production by 50 percent, has reduced the plant’s consumption of power by 60 percent and has eliminated the need to flare methane into the atmosphere.

The energy management program not only reduces power consumption it also produces financial savings. Advances in technology are being used to analyze, forecast, control and monitor CWW facility operations. The energy management program ensures that energy savings are incorporated into the daily routine. Improvements, such as the addition of generators, mean that facilities can decrease energy consumption during peak periods.

CWW’s Stewardship helps reduce the carbon footprint and sustain our environment

1.5 million gallons of fats, oil and greases are prevented from entering the sewer system each

year through partnerships and commercial hauling

Managed Maintenance efforts resulted in the

lowest annual cost per work order in

recent history.

CWW hit the pinnacle in online payment, with more than 50 percent of payments being made

electronically.

25,000

15,000

5,000

958

2012 2013 2014

300 658

7,597

20,606

871897

6,700

20,000

10,000

0

19,735

Fats, Oils and Grease Recycling

SUCCESSSTORIES

Total Gallons Recycling Events and Stationary

Apartments, Commercial,

Rendered

An employee recycling program, initiated this year, provides receptacles for paper, plastic, glass, cans, cardboard, batteries and ink cartridges. The initiative is already showing results.

A pilot project has been introduced to improve energy efficiency of the fleet vehicles. Two trucks are testing the use of propane as an alternative fuel.

Water QualityOnce again CWW’s drinking water quality is exceptional as evidenced by the North Columbus Water Resource Facility and lab receiving numerous awards in 2014, including best laboratory in the state.

The water being returned to the Chattahoochee is also of the highest quality, well below Georgia and Environmental Protection Agency standards for bacteria. A watershed coordinator is now taking samples throughout the watershed, analyzing them and investigating any problems.

Inflow and InfiltrationThe project to identify and reduce storm water inflow and infiltration (I&I) into the sewer system is ahead of schedule and under budget. Investigation and repairs have been completed in the Weracoba and lower Green Island basins. Lindsey Creek and Turkey Creek investigations have begun.

Sewer mains totalling 119,119 linear feet have been smoke tested and videoed. More than 211 repairs have been made to pipes and connections as a result of the investigations. Six of nine requirements have been completed ahead of the timetable set by the Environmental Protection Division.

Columbus was judged, in a blind taste test, to

have the best tasting tap water in the region of 19 counties and the second

best in the state.

CWW demonstrates environmental steward-ship by returning over

90% of water withdrawn back to the river.

SUCCESSSTORIES

Combined Meters at NCWRF

Modernization Rider NCWRF

Uptown Park CSO Facility

RTP*

South Commons

CSO Facility RTP*

SCWRF RTP*

SCWRF Blower

Automation

CBFT3 Co Generation

Total Savings

Total SavingsTo

tal E

nerg

y S

avin

gs

1995

-201

4

$10,000,000

$8,000,000

$6,000,000

$4,000,000

$9,000,000

$7,000,000

$5,000,000

$3,000,000

$2,000,000

$1,000,000$0

$2,5

49,6

32

$41,

527

$689

,965

$225

,094

$1,0

95,4

69

$3,4

80,7

94

$598

,632

$8,6

81,1

13

* R

eal t

ime

pric

ing

The Columbus Water Works finan-cial condition remained strong at year end with reliable plants and systems to meet demands. A solid liquidity position, conservative budgeting, and programmed annual rate increases continue. Columbus Water Works maintains one of the lowest rates among Southeastern cities and pro-jected rate increases over the next five years are below the national average.

CWW serves a population of approx-imately 257,799 including Fort Benning and provides supplemental water supply to Talbot and Harris Counties. During the fiscal year ended June 25, 2014, CWW delivered 9.21 billion gallons of water and treated 12.71 billion gallons of wastewater. The water distribution system includes more than six million feet of pipe in Columbus and more than one million feet of pipe in Fort Benning. The water distribution system served 67,004 metered accounts. The sewage collection system includes more than five million feet of pipe in Columbus and almost a million feet of pipe in Fort Benning.

Total combined Columbus and Fort Benning operating revenues were $59.48 million, an increase over Fiscal Year 2013 of $1.62 million.

Operating expenses before deprecia-tion/amortization increased $1 million as compared to Fiscal Year 2013. Oper-ating expenses, including depreciation/amortization, increased $2.6 million, up 4.82% from the Fiscal Year 2013.

Operating income for the year was $2.78 million, as compared to $3.77 million for Fiscal Year 2013. This amount includes activities related to Fort Benning contractual operations.

Columbus Water Works expended $28.97 million for capital improve-ments in Fiscal Year 2014.

Total Assets at year-end were 640 mil-lion. Reserves were maintained within established goals of 90 to 120 days for operational and coverage of capital improvements/depreciation for capital reserves.

For complete details of the Compre-hensive Annual Financial Report visit: cwwga.org/plaintext/reports/reports.aspx.

FINANCIAL SUMMARY

FISCAL YEAR 2013 TO 2014 COMPARISON

PROPOSED RATE COMPARISON SYSTEM AVERAGE (20 CCF)

CHAN

GE IN

NET

POSI

TION

Fiscal Year Ended June 25, 2013 2014 $ Change % ChangeAssets Current Assets and other Assets $ 90,734,706 112,403,866 21,669,160 23.88% Capital Assets 519,118,893 527,933,396 8,814,503 1.70% Total Assets 609,853,599 640,337,262 30,483,663 5.00%

Deferred Outflows Deferred Amount of bond refunding 7,161,333 6,838,200 (323,133) -4.51%

Liabilities Other Liabilities 16,868,692 16,933,414 64,722 0.38% Long-term Liabilities 202,118,498 216,355,182 14,236,684 7.04% Total Liabilities 218,987,190 233,288,596 14,301,406 6.53%

Net Position Net investments in capital assets 340,403,342 355,395,922 14,992,580 4.40% Restricted for Capital Activities 18,829,313 21,571,472 2,742,159 14.56% and Debt Service Unrestricted 38,795,087 36,919,492 (1,875,595) -4.83% Total Net Position 398,027,742 413,886,886 15,859,144 3.98%

ATLANTACHARLESTON

RALEIGHCHATTANOOGA

CHARLOTTEBIRMINGHAM

JACKSONVILLETAMPA

NASHVILLEMOBILE

GREENVILLEAUGUSTA

SAVANNAHMONTGOMERY

MACONCOLUMBUS

PHENIX CITYHARRIS CO. WATER*TALBOT CO. WATER*

$80.47

$85.73

$103.18$100.60

$110.82

$62.73

$81.44

$0 $100 $200 $300 $400$50 $150 $250 $350 $450

$116.29$114.51

$151.32

$167.67$157.25

$171.56$168.29

$186.90

$152.58$151.47

$153.66

$415.92

*water onlyAssumes 20 ccf = 2,000 cubic feet = 15,000 gallonsRates as of October 2014, with CWW proposed 2015 rates. Columbus rate excludes CSO charge.

$2 M$4 M$6 M$8 M

$10 M$12 M

2010

$8.7 M

2011 2012 2013 2014$0

$14 M$16 M$18 M$20 M $18.5 M

$4.8 M

$7.3 M

$15.9 M

CONDENSED STATEMENT OF REVENUES, EXPENSES AND CHANGES IN NET POSITIONFiscal Year Ended June 25, 2013 2014 $ Change % ChangeOperating Revenues Water Sales $ 23,574,540 $ 23,273,498 $ (301,042) -1.28% Sewer Charges 26,593,824 27,503,677 909,853 3.42% Fort Benning CM100 O&M Services 4,239,272 5,120,837 881,565 20.80% Tapping, CSO fees and miscellaneous charges 3,456,615 3,579,837 123,222 3.56% Total Operating Revenue 57,864,251 59,477,849 1,613,598 2.79%

Operating Expenses System Services 6,792,375 6,902,076 109,701 1.62% South Columbus Water Resources Facility 4,280,253 4,591,060 310,807 7.26% North Columbus Water Resources Facility 4,429,056 4,137,787 (291,269) -6.58% CSO Plants 1,144,192 1,052,395 (91,797) -8.02% Managed Maintenance 2,651,699 2,745,982 94,283 3.56% Engineering 1,356,374 1,460,877 104,503 7.70% Information Services 1,071,430 1,118,345 46,915 4.38% Water Quality Monitoring 1,729,145 1,858,625 129,480 7.49% Fort Benning 4,734,344 4,923,728 189,384 4.00% Customer Services 1,557,062 1,609,360 52,298 3.36% Meter Service Department 712,210 742,539 30,329 4.26% Finance, Employee Serives and Administration 4,154,804 4,449,816 295,012 7.10% Meter Reading 925,108 949,645 24,537 2.65% Depreciation and amortization 18,552,657 20,156,528 1,603,871 8.64% Total operating expenses 54,090,709 56,698,763 2,608,054 4.82% Operating Income 3,773,542 2,779,086 (994,456) -26.35%

Non-operating Revenue Interest Revenue 88,619 83,955 (4,664) -5.26% Ft Benning Financing Contract - 2009 Bond Issuance 4,860,492 4,860,492 - 0.00% Administration fees and other revenue (375,783) 4,264,315 4,640,098 1234.78% Interest Expense (1,747,410) (660,080) 1,087,330 62.23% City of Columbus participation expense (2,718,589) (2,743,755) (25,166) -0.93% Gain (loss) on disposal of assets 137,206 79,833 (57,373) -41.82% Total non-operating revenue (expenses) 244,535 5,884,760 5,640,225 2306.51% Income before capital grants and contributions 4,018,077 8,663,846 4,645,769 115.62%

Capital grants and contributions 3,268,506 7,195,298 3,926,792 120.14% Change in Net Position 7,286,583 15,859,144 8,572,561 117.65%Net Position at Beginning of Year 390,741,159 398,027,742 7,286,583 1.86%Ending Net Position $ 398,027,742 $ 413,886,886 $ 15,859,144 3.98%

EXPENSES BY FUNCTION OPERATING REVENUES BY SOURCE

42%WATER

39%WATER

46%SEWER

46%SEWER

12%OTHER

15%OTHER

The Customer Satisfaction Index (CSI) has been conducted monthly since 2004. The survey is administered to a random telephone sample of about 100 customers per month. It measures customer’s perceptions of: reliability, water qual-ity, value/price, customer service and informa-tion. This year only, the CSI was expanded to Fort Benning.

Results of the Columbus customer survey show 86 percent are totally or mostly satisfied as a cus-tomer. These high ratings are due in great measure to the dedicated and professional members of the CWW team. During 2014, the customer service area touched approximately 118,000 customers either in person or by phone.

Our Mission Provide our community a safe and dependable drinking water supply, en-hance our water resources by collecting and treating wastewater and promote a legacy of responsible economic and environmental stewardship.

Our VisionTo be an outstanding provider of utility services, dedicated to protecting the environment, aspiring to new opportunities and compelled to excel in service to our community.

Our ValuesIntegrity, Customer Focused, Employee Oriented, Environmental Stewardship, Innovation and Community Leadership.

ContactColumbus Water Works 1421 Veterans Parkway

P.O. Box 1600Columbus, GA 31902

Main Office: (706) 649-3400

www.cwwga.org

During FY 2014, the total employee turnover rate was 4.4 percent —far

below the rate at similar regional utilities.

FY06/07

FY10/11

FY04/05

FY08/09

FY12/13

FY07/08

FY11/12

FY05/06

FY09/10

FY13/14

CWW Customer Satisfaction Index Scores per Fiscal Year

900

800

700

950

850

750

1000

779810 817 829

785=Benchmark Target for Customer satisfaction(2005-2009)

825=Benchmark Target for Customer satisfaction (2010-current)

843 839818 818

845886

Sco

res