ROX Interview: Ron Fleming

Chairman/President/CEO, Global Water Resources

Interview by Bea Lueck

There is a quote often attributed to Mark Twain that goes, “Whiskey is for drinking; water is for fighting.” No truer phrase exists in the Southwest. Dwindling supplies brought on by drought conditions have limited development growth in the region. Farm fields sit idle, subdivisions are on hold and announced attractions (Attesa Motorsports and Dreamport Villages) remain in limbo due to the lack of available water. One critical problem facing municipalities statewide – how to plan water use not only for current needs but future growth as well.

I sat down with Ron Fleming, Chairman, and CEO of Global Water Resources to discuss our precious desert commodity – water, and how the region is preparing for the future.

GC LIVING: Where were you born and raised?

Ron Fleming: I am an Arizona native, born and raised in a little city called Lake Havasu City over on the Colorado River. Most people have heard of it from being a destination for spring break and summer fun on boats. It was a great place to spend my childhood.
I am the youngest of five; two older sisters and two older, twin brothers. My dad was a high school teacher and coach, and ultimately my mom joined the school district and has worked there for nearly three decades. She has been an administrative assistant to the superintendent for much of that time.

GC LIVING: Where did you go to college?

Ron Fleming: Northern Arizona University in Flagstaff; as I had decided to do something a little bit different than the hot desert. And I loved it.

I managed the cold; even though I didn’t own a jacket before I moved to Flagstaff. I got a degree in construction management with an emphasis in heavy civil; the backstory to that is how I got started in the water industry.

I met my wife Jessica at NAU. She was getting an elementary education degree with a secondary in special education. After college, we moved to Phoenix together. Funny, I’ve been with Global Water for over 16 years but because my roles and the company have changed so much, we’ve actually moved a lot. We bought our first home in Mesa but then moved on to the City of Maricopa not too long after being hired by Global Water — as I was working there during the boom years. Later, Global Water bought utilities out in western Maricopa County. Frankly, they were a mess and needed day-to-day focus, so we picked up and moved again.

Ron with wife Jessica, son Dylan, and daughter Hayden

CG LIVING: Can you tell us a little more about those moves?

Ron Fleming: Sure. Unfortunately, a lot of these utilities are just not in great condition and not well-run. My expertise is to fix them. We moved out to Goodyear so I could run our West Valley region, and clean up the utilities we had acquired out there. Then when I was promoted to the executive team in around 2012, I needed to be at our corporate office in north Phoenix every day — so that is where we live today. Along that journey, we had two kids; a son, Dylan, who’s now 10, and a daughter, Hayden, now 9.

My wife taught for many years in several different school districts. Today she’s a stay-at-home mom, and they stay very busy with activities, sports, and school. As you can imagine, having a prior teacher now as a stay-at-home mom, came in very handy during 2020. We like to vacation, camp, just hang out with families and friends; swim in the pool. Kind of that normal Arizona lifestyle.

GC LIVING: About that backstory. What did bring you into the water industry?

Ron Fleming: I started as a teenager working with a family friend’s business in Lake Havasu where they did the septic systems. On the wastewater side, Lake Havasu was all septic back then; and I did work on residential new construction systems.

It may have been a combination of that experience and growing up on the river. I wouldn’t say I had a clear vision, but I somehow said, “You know what? Building things that have to do with water probably makes sense as a career choice.”

After college and internships with large general contracting firms, I was hired to be project engineer on a large 26 million gallon per day water treatment facility. That led to building some water and wastewater plants around Arizona, and some freeway systems on the general construction side before jumping over to the owner-operator side, which is what Global Water is.

GC LIVING: When did you join Global? Were you with any other water companies?

Ron Fleming: Kind of like any industry, once you’re in it, it’s pretty small. You get to know everybody fairly quickly. And so, sure I was on the construction side, but there’s only so many of those general contractors that do the large-scale stuff, and you’re doing them for all the municipalities or a few of the large private providers. I got a chance to meet a lot of people in water and wastewater.

One of my prior bosses had left the general contractor I was working for and was one of the initial hires of Global Water. He was hired to be vice president of engineering and construction and he called me and said, “Hey, you should follow me. You should make the jump from the construction side to the owner-operator side.” That was at the end of 2004.

So, I’ve been with Global Water ever since, for over 16 years. It’s where I started my career with owner-operator private utilities.

You’ll recall that 2004 into 2007 were boom years for the City of Maricopa, and those were the first utilities Global Water bought. We were basically putting in $5 to $8 million a month of infrastructure for years on end and I oversaw that capital improvement program. Let’s just say I really, really, learned a lot during those times.

GC LIVING: Maricopa exploded faster than everyone anticipated, and then it fell faster than anyone ever anticipated, and now we’re back to explosive growth. How does a company keep up with both ends of the cycle?

Ron Fleming: It’s been quite a ride; lots of peaks and valleys. As we know, Maricopa became somewhat a poster child for the foreclosure crisis nationally. I always say you learn even more in tough times than you do in good times, so I learned a lot in the years 2008 to 2012 as well. I mean, it took half a decade to really get through the great recession — I’m talking from a company perspective — and dig our way out of all the things that happened and start to make the climb back to a position of financial strength.

Fortunately, I was doing well enough and continued to get promotions. I moved from senior project manager overseeing our capital improvement program up to general manager. At that point, I was in charge of all the day-to-day activity — operations, maintenance, customer service, compliance, regulatory affairs, growth services, etc.

With respect to the company, for sure the City of Maricopa is our flagship. It is our largest customer base, and it’s a very important partnership to us. But, it is also important to note that Global Water is much bigger than the City of Maricopa. We bought utilities in Buckeye, we have large service areas in western Maricopa County in Tonopah.

We now own utilities throughout the Sun Corridor from Maricopa over to Coolidge where we got the service contract for Nikola and Jackob Andersen’s Inland Port Arizona project. We own the utilities in Red Rock on the way to Tucson, and we own a hand full of utilities around Tucson and there are more in the pipeline.

We have recovered to the point and perform at a level today where we’re being asked to take our specialty and our business to lots of places to help communities with their utility challenges and to grow.

I had the opportunity to become president of all the regulated utilities and then president of the parent company. Global Water is a utility holding company. We buy and own these utility subsidiaries underneath the parent company. I’ve been president and CEO of Global Water since 2014.

GC LIVING: So here in Pinal County, you’ve got Santa Cruz for potable water, Palo Verde for wastewater, Red Rock kind of straddles Pinal and Pima; Picacho Cove, which is down by Eloy…

Ron Fleming: And the new southern area of Coolidge.

GC LIVING: And Coolidge. Because I know it’s in the path of your growth areas, what’s up with Mohawk Water, Grande Valley, all of these areas?

Ron Fleming: First, let’s talk a little bit more about the company. The company’s business plan was actually pretty simple — go into new emerging areas around growth corridors, specifically ones where there are water challenges, and provide an integrated utility solution – water, wastewater, and recycled water. We just thought, “Look, if you have a great greenfield opportunity where roads aren’t paved yet, things aren’t locked in, let’s build utilities right from the ground up.”

Historically you have a lot of developer-owned utilities just focusing on their single development and selling homes in their development, or legacy water and wastewater utilities where it’s passed down from generation to generation within families, but they’re not really interested in growing or being a professional utility organization. Then you have new areas where there’s nothing planned, but you have landowners who want to develop. These are the type of situations where we come in.

After Maricopa exploded, I think people started to recognize the value of our model, and we started getting more calls from people asking: “Hey, can you do that over here?” So we bought utilities in western Maricopa County, started laying out some of the same regional, integrated plans for the whole Tonopah region. Then, we replicated this a third time in the area between Coolidge and Eloy, and from there started extending our areas south towards Tucson.

Today, it’s not just rooftops anymore. There is a lot of industry and commercial coming into our service areas; so we are also busy managing this type of growth. People are moving to Arizona, moving to metro Phoenix, and moving specifically to Pinal County. Jobs are moving here as well.

When you put it all together, we have these large regional service areas planned for integrated water, wastewater, recycled water, and much of the foundational work is in place from a planning and permitting perspective.

People are seeing all of this, and it’s making these areas move up from a competitive perspective on attracting more home building, in a way that it kind of builds on itself and draws more industrial-commercial.

To your question, we are basically working with landowners from Maricopa to Casa Grande. We do have service areas in Casa Grande as well. Generally, we don’t cross Montgomery because on the other side of Montgomery is Arizona Water Company and the city’s municipal wastewater system. But we will serve all the way down to Grande Valley moving from Maricopa into Casa Grande, south to a big project that is planned near Francisco Grande called Legends, and then we work our way back up around over to John Wayne Parkway and up the west side of the City of Maricopa’s planning boundary, and around the Ak-Chin Indian Community to the west side of Ak-Chin.

Again, we’ve got the Nikola project and the Pinal Land Holdings IPAZ project in Coolidge, both are located in an approximate 30 sq. mile franchise area we have with Coolidge. And in Red Rock, homebuilders have bought land around the utility we acquired from Diamond Ventures there, and those new subdivisions are moving forward.

Down around Tucson, we’ve again teamed to work with Diamond, who’s got lots of land down there.

We have a large regional footprint with a utility foundation layed, and there is a whole lot going on, which is fantastic.

GC LIVING: The City of Casa Grande owns a small water company that ends up being in your coverage area, the Copper Mountain Ranch Facilities Improvement District. That’s a mouthful. Are you in discussions to purchase it?

Ron Fleming: I can’t speak to any deal specifically. But we are an acquisitive company. We’ve bought five utilities in just the last couple of years, up to eight over the last 4 years, and today currently operate 16 utilities. We have more in the pipeline. We are always open to looking at any utility and seeing if we can be of help to all of the stakeholders.

GC LIVING: You have a rather unique situation in Maricopa. You have both the potable water and the wastewater. How does having the wastewater help with your water usage? I’ve seen the water in the green wash, is that recharge or how do you make the water balance out?

Ron Fleming: Global Water’s model was based on owning and operating water, wastewater, and recycled water utilities in the same geographic area. You can think about it in terms of the common industry wording: one water. There’s only one water, it just exists in different places, in different forms, and different qualities — potable water sometimes, sometimes it’s groundwater, other times its surface water, and sometimes stormwater. Whatever makes it into the wastewater system is treated and becomes treated effluent, or what we call – recycled water. It’s very important to note, the water in wastewater is not waste, it can be cleaned, purified, and reused over and over again. We treat wastewater to a very high quality called class A-plus, the highest quality regulated in Arizona, and in our areas, we make each subdivision agree to utilize that resource for their common area irrigation. Maximizing water recycling is just one element of our approach to conservation and the one water concept, which we call Total Water Management.

The important question is, does it work? The City of Maricopa, which now has almost 60,000 people, has the second-lowest gallons per capita per day than any other designated water provider in the state. And that’s not by accident — it’s due to our water resource model and total water management approach.

Beyond water recycling, on the potable water side, we have the most innovative conservation rate design in the state. Our rate design has seven tiers and a rebate threshold, so when customers conserve and can come in under the average usage or a threshold that we defined for the community, we give them a rebate right back on their bill. Then, we use fix-based automated meter reading for the entire city. That means we read the water meters continuously; we take all that data and we use it for good purposes inside of our utility, but we also turn that data around and provide it to our customers. When our customers log on to our utility portal, they can see their hourly, daily, weekly and monthly usage, and can set up alerts for leak detection or other monitoring tools. You combine the rate design and rebate program, with the ability to see and use actionable data, that is when you help customers achieve meaningful conservation.

GC LIVING: Is the Holy Grail of water achieving as close to 100% water use versus recycle the goal to meet, so that your net use is zero gallons, basically?

Ron Fleming: You can’t ever get to that, as not all water use makes it back down drains to become wastewater, such as outdoor irrigation. But what the goal should be, and this is our goal and we’re pretty close to it, is 100% beneficial reuse of whatever wastewater is generated in a community. We call our water reclamation facilities, two things — water recycling facilities and resource recovery centers.

Beyond the water recycling, all the other things that come through a wastewater system from a community are mostly organic, and the way you treat it, it just ends up being basically an inert dirt like material, known as biosolids, which can be used as fertilizer or compost. We recover all of that. We have agreements with local farmers in which they take that material and they do use it for fertilizer. That means we are taking almost 100% of the wastewater that the City of Maricopa creates and we put it to a beneficial use. That’s a resource recovery center.

GC LIVING: Let’s talk about communities without the ability to issue hundred-year assured water supplies. Obviously it impacts growth and development. Is there a solution?

Ron Fleming: This specific issue is why I hired one of the industry’s best, in my opinion, and well-known water resource experts, a gentleman named Jake Lenderking. I hired him primarily to tackle the Pinal County assured water supply issue, because it’s significant.

We really want to be a leader in water resources not just in our areas, but across the county and industry. It’s not good for economic development, and not really good for the community as a whole, for there to be a negative belief that growth in Pinal County is going to stop or be limited because of the water resource challenges.

We said, “Let’s help try to solve it countywide, even though we obviously don’t serve all areas in the county. We’ve worked with many of the groups we are part of, including Pinal Partnership, and started lots of things to look at the bigger issue, including the current Eloy and Maricopa-Stanfield basin study, which is a long-term planning exercise working with the Bureau of Reclamation and all of the stakeholders. When I say all, I mean, all cities, landowners, Native American communities, agricultural in the Pinal AMA. That’s an all-inclusive exercise that’s going well, and we are multiple years into it. A final report could be completed in 2022.

And there are a lot of other water resource groups that have come together. For example, the Pinal Stakeholder Group that led to specific water legislation that occurred this year and was recently signed by Gov. Ducey. Jake Lenderking, is also a co-chair of that group. While that legislation will be helpful, it’s just one small step, and now the group is working on more things we can do short- to medium-term.

I give credit to some of the other private providers, and the county, municipalities, and organizations working on these issues — there’s more coordination, cohesion and people willing to work together now than ever.

GC LIVING: What would you like to end with?

Ron Fleming: I’ve built most of my professional career in Pinal County. I have worked around the state, but Pinal County is where I got my foot in the door with Global Water. I just really enjoy working in Pinal because in some respects it’s similar to my company’s original strategy, which was, again, buy or build utilities in the path of growth. Pinal County is just that. It’s the area between Phoenix and Tucson. It’s so ripe with opportunity, and it’s always enjoyable to pursue an opportunity with such good people.

Further, on that point, the way everybody, in my opinion, continues to work together through groups like Maricopa Economic Development Alliance in Maricopa specifically, in Pinal Partnership on a bigger scale, even the charitable organizations, and other community organizations – I just think it’s unique what’s going on in Pinal and along the Sun Corridor.

I’m happy that Global Water and me personally, have such a big interest in what is going on in Pinal, and we’re going to continue to do our part to help everybody succeed in bringing all those opportunities together. On this point, I have to highlight my team at Global Water, as they truly allow me to say that with confidence. We can and will do our part, because of them, their professionalism, and passion.

GC LIVING: Crystal ball moment. Where do you see us in 20 years? 50 years?

Ron Fleming: I think the next 20 to 50 years is going to be a tremendous amount of growth that is going to be all we can do as a stakeholder group to manage in the right way.

But on the water front, I do think we will have made significant progress in solving the challenges that exist today — not by one thing, but a hundred things broken down into smaller buckets. Everybody in the county will be doing all they can on the conservation front. Moving up from that, we’ve figured out how to get more out of our large, shared groundwater aquifer. Moving up from that, we’ve figured out how to bring more renewable water supplies into the county. And moving up from that, maybe by then we’ve embarked on our own large infrastructure projects where we kind of control our own destiny because we will have the ability to bring in sufficient amount of water to allow the Sun Corridor between Phoenix and Tucson to really be limitless.

I do think all those things can happen on a horizon like that, and it will be a big success story.