A Business Checklist [Not Just] for Water Purveyors

Beyond providing safe drinking water to customers, public agencies, mutual water companies and investor-owned utilities must ensure that all business-related matters are in order.  Below is a list of questions that water purveyors should ask themselves at least once per year to make sure the business side of things is running like clockwork.   


  1. Do we have a corporate record book with uptodate documents that define the organization of the business, voting rights, and any and all operating agreements or bylaws?  Every water purveyor has a short list of important organizational documents.  These documents should be kept in one place, and should be easily accessible.  They also need to be up to date, reflecting the current status of your agency.  This may be particularly important for mutual water companies with a long operating history (and perhaps one or more outdated documents).  A mutual water company should also check to make sure that its Articles of Incorporation and By-laws are properly drafted, and have incorporated the new requirements having to do with public meetings, as implemented by AB 240.  
  2. Do we have financial books and records documenting all of the business’s existing assets and liabilities?  It is important for each water purveyor to have uptodate documentation of existing assets and liabilities.  These documents may need to be easily accessible when applying for state or federal grant money or financing a project.  The financial books and records should be updated periodically, as assets are acquired and debts are reduced and eliminated. 
  3. Do we have all leases, deeds, and tax documents for any real property owned by our agencyIt is particularly important that all documents related to real property be readily available.  You never know when you may need to produce these documents accurately and quickly.  For example, access to these documents has been critical for mutual water companies in the Los Angeles area in the last year or so.  In that time, the Los Angeles Assessor’s Office has issued substantial refunds based on double taxation that has occurred as a result of appurtenant shares issued by mutual water companies.  These mutual water companies were called upon to provide various documents related to real property owned, such as all deeds to real property as well as property tax statements.  The mutual water companies that had these documents readily available were able to receive refunds much more quickly than those that did not.  
  4. Do we have sufficient general liability insurance to cover all potential liabilities, fire and theft insurance to cover potential risks of loss, and workers compensation?  Being underinsured (or uninsured) exposes your agency to financial hardship in the middle of an emergency.  If your agency is not adequately insured, you should take the steps necessary to become insured as soon as possible.  Even if you are properly insured, it is important to periodically shop around to ensure that you are paying competitive premiums and that your coverage is tailored to your specific needs.  Consult your broker where appropriate.   
  5. Have we have developed a plan for future management succession ready to be implemented immediately upon the death or retirement of existing managers?  In any workplace, employees and members of the management come and go.  Having procedures for hiring and firing will make these transitions go more smoothly.  Perhaps a policy manual can be drafted that will guide the process.   
  6. Do we have a comprehensive employee/office manual that defines all business policies and procedures, including sexual harassment, social media, and anti-discrimination policies?  In many ways, water purveyors operate like any other business.  Legal issues having to do with labor and employment will need to be dealt with properly and professionally.  This is particularly true of public agencies, which will undoubtedly face public scrutiny if any violations are discovered.  Just as with hiring and firing, it may be a good idea to have procedures in place that govern the employee-employer relationship.  Additionally, your agency may want to draft guidelines that specifically address the potential dangers of social media and the Internet in the workplace, as these dangers have become more and more pervasive.   
  7. Do we have up-to-date employment agreements for key members of management, with confidentiality provisions and clearly defined job duties?  As employment laws and regulations evolve, so do the agreements that govern your agency’s relationship with certain of its employees.  It is important to have job duties clearly defined in any employee contract.  In the context of public agencies, this may be particularly important for the employment agreement with your General Manager.  The General Manager is a critical position for the success of the public agency, one that should be properly governed by a well-drafted employment contract.  
  8. Do we have a documented benefits plans covering health, life, disability, profit-sharing, and pension/retirement?  Any employer needs to make sure that its employees are properly taken care of with respect to the various benefits offered to them.  Is the healthcare plan offered to employees the best quality available for the premiums paid?  Is there anything that the Affordable Care Act can offer your agency that is not yet being utilized?  How comprehensive is the disability insurance being offered?  Are you offering any retirement benefits to employees?  These are the kinds of questions agencies should be asking themselves periodically.  Additionally, it is crucial to make sure that you fully understand the policies and plans your agency offers, and makes sure that it is the best premium on the market.  Brokers and consultants can help guide you through this process, and usually earn their compensation through lower premiums.  
  9. Do we have records to prove compliance with various laws and regulationsThere are numerous laws that water agency employees and directors must follow.  It is critical to have documentation that demonstrates compliance with these laws.  Examples include staff certifications, water quality compliance, and director trainings (AB 1234 for public agency directors & AB 54 for mutual water company directors).  


Every year, changes in applicable laws and regulations make operating a business more challenging.  By staying on top of your business records, and policies and procedures on a regular basis, you can stay out of potential traps and pitfalls. 

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