Denver Water - Comprehensive Analysis Report
Summary
Denver Water, established in 1918, is Colorado's oldest and largest water utility, serving approximately 1.5 million people across the City and County of Denver and nearly 50% of its surrounding suburbs. Operating as an independent public agency, it manages the collection, storage, quality control, and distribution of drinking water. The utility's funding comes from water rates, new tap fees, and hydropower revenues, distinct from tax allocations.
Denver Water's mission is to be a national leader in delivering clean water, maintaining a reliable and resilient system, and safeguarding the water resources of the West. Its vision is to foster vibrant communities that value water for future generations, enhancing the lives of people in the Denver metropolitan area and the surrounding mountains. Given Colorado's arid climate and continued population growth, Denver Water plays a vital role in managing critical water resources, addressing climate change challenges, and promoting regional collaboration for sustainable water solutions throughout the Western United States.
1. Strategic Focus & Objectives
Core Objectives
Denver Water's Strategic Plan emphasizes sustaining a reliable and resilient water system amid challenges such as a warming climate, population expansion, drought conditions, and evolving regulatory landscapes. Key objectives include:
Customer-Centricity: Prioritizing customer needs in all operations and service delivery.
Industry Leadership: Setting standards through the adoption and promotion of best practices in water management.
Forward-Thinking Approach: Proactively anticipating future trends and implementing progressive solutions to meet long-term water demands.
Infrastructure Sustainability: Planning, building, operating, and maintaining its infrastructure to ensure current and future water needs are met.
Specialization Areas
The utility's key areas of specialization include:
Efficient Water Use: Implementing programs and technologies to promote conservation among customers.
Environmental Stewardship: Protecting water resources and surrounding ecosystems.
Clean Energy and Green Infrastructure: Expanding initiatives in hydropower generation and environmentally friendly infrastructure development.
Advanced Water Treatment: Utilizing state-of-the-art technologies for high-quality drinking water.
Target Markets
Denver Water primarily targets residential, business, and industrial customers within Denver and its suburban service areas. Approximately 47% of its retail treated water is consumed by single-family homes, 23% by businesses and industries, and 20% by multifamily homes.
2. Financial Overview
Funding History
As a public entity, Denver Water is funded by revenues generated from water rates, new tap fees, and hydropower. It operates through the Water Works Fund, separate from the city’s general fund.
Estimated Annual Revenue: Approximately $378.8 million.
2020 Total Operating Revenues: $357 million.
Fiscal Year 2023 Annual Budget: US$700 million.
Denver Water is currently executing a 10-year, $2.3 billion system investment plan, which is a primary driver for necessary revenue increases. This capital is allocated to major strategic projects and ongoing maintenance:
Major Strategic Projects: Gross Reservoir Expansion Project, Northwater Treatment Plant, and the Lead Reduction Program.
Ongoing Investments: Main replacements and various infrastructure improvements.
Revenue adjustments are determined annually within the financial plan to cover operating and maintenance expenses, debt servicing, and rate-funded capital projects. The utility utilizes a combination of debt and cash reserves to manage costs and maintain stable rates for its customers.
3. Product Pipeline
Key Products/Services
Denver Water is actively engaged in several significant infrastructure and program developments to ensure a robust and resilient water supply system.
Gross Reservoir Expansion Project
Description: This project involves increasing the reservoir's water storage capacity by raising the existing dam by 131 feet. It will feature new roller-compacted concrete steps on the dam's face.
Development Stage: Construction began in April 2022, following over two decades of planning.
Expected Timeline: Completion scheduled for 2025, reaching an elevation of 7,289 feet above sea level.
Key Benefits: Enhances water storage capacity, ensuring greater reliability for future water supplies.
Northwater Treatment Plant
Description: A state-of-the-art water treatment facility located north of Golden. It is designed with ultraviolet technology for disinfection and features a hydroturbine for hydropower generation, making it capable of producing more energy than it consumes.
Development Stage: Completed in 2024.
Target Market/Condition: Provides high-quality treated water to the Denver Water service area.
Key Features and Benefits: Initial capacity to clean 75 million gallons of water per day, with future expansion capability to 150 million gallons per day. It will gradually replace the aging Moffat Treatment Plant (dating from the 1930s), offering improved efficiency and sustainability.
Lead Reduction Program
Description: An ongoing initiative focused on the replacement of customer-owned lead service lines. Denver Water covers the direct cost to customers for these replacements. The program includes extensive community engagement and education.
Development Stage: Ongoing.
Target Market/Condition: Service areas with lead service lines, particularly focusing on underserved communities.
Key Features and Benefits: Aims to eliminate lead exposure in drinking water. Received $76 million in federal funding in 2022 to accelerate efforts in underserved communities.
Main Replacement Program
Description: This program involves monitoring, planning, and scheduling the replacement of over 3,000 miles of buried water delivery mains.
Development Stage: Ongoing.
Key Features and Benefits: Since 2022, Denver Water has replaced an average of 97,000 feet of water mains annually, with a goal to increase this to over 145,000 feet (1% of its water mains) per year. Upcoming projects include replacing 5 miles of 130-year-old pipe under East Colfax Avenue in 2025 and commencing work on Sheridan Boulevard in 2026, ensuring system reliability and reducing water losses.
4. Technology & Innovation
Technology Stack
Denver Water employs advanced technological platforms and innovative methodologies to ensure water quality, system efficiency, and environmental stewardship.
Advanced Filtration Technologies: Utilizes nano-filtration and advanced membrane systems for highly efficient impurity removal, leading to reduced energy and chemical consumption.
Smart Water Monitoring: Integration of Internet of Things (IoT) technologies provides real-time water quality monitoring across the distribution network, facilitating immediate adjustments and proactive maintenance.
Biological Treatment Processes: Adoption of biologically active filtration systems, which incorporate biofilm technologies, for organic breakdown of contaminants, minimizing the need for chemical disinfectants.
Energy Recovery Systems: Treatment plants are equipped with energy recovery systems to capture and reuse energy, reducing operational energy demands and carbon footprints.
ArcGIS Pro-centric AquaTwin Water Digital Twin Platform: Leveraged for building, operating, and managing its extensive water distribution system. This platform manages data for 3,100 miles of pipes, 33,000 hydrants, 144 pressure zones, 150 major control valves, 520 pressure regulating valves, 58 storage tanks, and 200 pump units in 51 stations.
Operational Technology Specialists: Design, install, and maintain control systems for dams, hydropower plants, treatment plants, and pump stations, utilizing networks of cables, fiber optics, radio, and wireless signals.
Scientific Methodologies
The utility employs specific scientific methods for water quality analysis and prediction:
Chloride to Sulfate Mass Ratio (CSMR) Analysis: Used to analyze water and correlate it with lead levels, predicting potential spikes and variability, particularly at its Marston Lake and Foothills treatment plants. Linear models and statistical methods are employed for these predictions. The treatment process at Foothills and Marston, involving coagulation/sedimentation, filtration, and disinfection, demonstrably reduces CSMR levels.
5. Leadership & Management
Executive Team
Denver Water is overseen by a five-member Board of Water Commissioners, which appoints the CEO/Manager. The Executive Leadership team reports to the CEO/Manager and includes chiefs of five divisions (Engineering, Finance, Operations and Maintenance, External Affairs, and Administrative Services), along with the chief of staff, internal auditor, and general counsel.
Alan Salazar, CEO/Manager
Professional Background: Appointed interim CEO/Manager in August 2023, and permanently in January 2024. A fifth-generation Coloradan, he holds a bachelor's degree in history and political science and a law degree from the University of Colorado. Possesses over 30 years of public sector experience, including roles as chief strategy officer for former Colorado Gov. John Hickenlooper, chief of staff for U.S. Rep. Mark Udall, deputy chief of staff for Gov. Roy Romer, and chief of staff for former Denver Mayor Michael B. Hancock.
Notable Achievements & Contributions: Oversees a 10-year, $2.3 billion system investment plan and the provision of water to 1.5 million people. Represents Denver Water in governmental and stakeholder relations, particularly regarding the Colorado River Basin Water Crisis. Key involvement in major projects like the Lead Reduction Program, Gross Reservoir Expansion, and the High Line Canal collaboration.
LinkedIn Profile: [Alan Salazar on LinkedIn](https://www.linkedin.com/in/alanbsalazar/)
Julie Anderson, Chief of Staff
Professional Background: Joined Denver Water in 2008 as manager of Customer Care, becoming director of the Customer Relations division from 2011 to 2016. Previous roles include group manager of Molson Coors Brewing Company's consumer affairs department and manager at OppenheimerFunds. Holds a Bachelor of Science degree in business administration from the University of Colorado.
Notable Achievements & Contributions: Oversees various administrative functions and plays a crucial role in internal coordination and strategic initiatives.
LinkedIn Profile: [Julie Anderson on LinkedIn](https://www.linkedin.com/in/julie-anderson-a13a83b/)
Robert J. Mahoney, Chief Engineering Officer
Professional Background: Joined Denver Water in 2006 as director of Engineering. Previously served as vice president/managing engineer at Brown & Caldwell and as an engineer and principal engineer at Boyle Engineering Corporation. A registered professional engineer in Colorado, he holds a Bachelor of Science degree in civil engineering from South Dakota State University and an MBA from Regis University. He received a Certificate in Executive Leadership from Regis University in 2007, Project Management Professional Certification (PMI) in 2011, and Portfolio Management Professional Certification (PMI) in 2024.
Notable Achievements & Contributions: Leads efforts to update engineering standards and manage significant capital projects, including the Gross Reservoir Expansion, Northwater Treatment Plant, and lead pipe replacements. Recognized as a Top 25 Newsmaker in 2024 by Engineering News-Record.
LinkedIn Profile: [Robert J. Mahoney on LinkedIn](https://www.linkedin.com/in/ robertjmahoney/)
Rick Marsicek, Chief of Water Resource Strategy
Professional Background: Joined Denver Water in 2017 as manager of Water Resource Planning and was named Chief of Water Resource Strategy in 2021. Previously served as Director of Engineering at South Metro Water Supply Authority and worked as an engineer and water resources planning manager at Aurora Water. A registered professional engineer in Colorado.
Brian Good, Chief Administrative Officer
* Angela Bricmont, CFO
Recent Leadership Changes
Alan Salazar was appointed the interim CEO/Manager of Denver Water on August 7, 2023, and officially transitioned into the permanent CEO/Manager role on January 24, 2024. He succeeded Jim Lochhead, who retired after serving as CEO/Manager since 2010. Mr. Lochhead was recognized for his leadership in improving operational efficiencies and fostering regional cooperation in water management during his tenure.
6. Talent and Growth Indicators
Hiring Trends and Workforce
Denver Water employs approximately 501-1000 individuals. Current hiring patterns indicate ongoing recruitment efforts, with approximately 8 open job positions listed on Indeed. Key roles being recruited are aligned with the utility's operational and strategic needs.
