liberty water customer satisfaction – final report september, 2011

Liberty Water Customer Satisfaction Final Report September, 2011

Contents Objectives & Methodology 1. 2. Key Findings & Recommendations 3. 4. Detailed Findings By Business Manager Detailed Findings Overall 2 Contents

Objectives & Methodology 3 Objectives A total of 1,007 surveys from Liberty Waters customers were completed All interviews were completed through the phone Interviews were conducted in the 4 areas Liberty Water services: Central Arizona: LPSCO, BM: Matt Garlick Southern Arizona: Bella Vista, Rio Rico, Northern Sunrise, Southern Sunrise, BM: Martin Garlant Eastern Arizona: Black Mountain, Gold Canyon and Entrada del Oro, BM: Charlie Hernandez Central US: Tall Timbers, Woodmark, Big Eddy, Holly Ranch, Hill Country, Ozark Mountain, Holiday Hills, BM: Joe Wilkins For each of the 4 business manager 250-253 interviews were completed The study was fielded from September 1 st to September 20 th 2011. Methodology Compare current customer satisfaction levels with 2010 and 2009 index scores Analyze satisfaction at the overall level as well as by Business Manager Objectives & Methodology

KEY FINDINGS & RECOMMENDATIONS 4

Respondents were very familiar with the name of the facility that provides water/waste water to their home. The Liberty Water name has caught on very well since its introduction with 72% of customers aware of it. Customers in Central AZ were most aware of the name Liberty Water (83%). Central US and Eastern AZ had the lowest recall of Liberty Water (73% and 55% respectively); facility customers within these regions were also significantly more likely to name the facility, other names, or do not know. Facilities with customers significantly more familiar with the facility name rather than Liberty Water were: Tall Timbers (25%) Central US Woodmark Utility (21%) Central US Big Eddy (29%) Central US Facilities with customers significantly more familiar with other names or do not know : Black Mountain Eastern AZ 4% Municipal/City (vs. 1% overall) 11% Do Not Know (vs. 5% overall) Gold Canyon Eastern AZ 10% AZ Water Co. (vs. 9% overall) Entrada del Oro Eastern AZ 13% AZ Water Co. (vs. 9% overall) Awareness 5 Key Findings & Recommendations

Perception A positive perception of the facilities was reported Overall, 69% of respondents made positive comments. Good/like it mentioned by 66% of respondents. A third of respondents (35%) commented negatively. This was up 6% from 2010. Key concerns were: Cost is too high/expensive (25%, up 5%); significantly higher in Eastern AZ (45%) Poor water quality (6%) Southern AZ respondents were most positive, while Eastern AZ customers had the worst perception Respondents in the Southern AZ service area were most likely to describe their facility positively (78%) and least likely to give negative comments (29%). Eastern AZ respondents were on the opposite spectrum being least likely to describe their provider positively (54%) while giving the most complaints (48%). 6 Key Findings & Recommendations

Water Services Satisfaction with water services received remained high. Top satisfactory aspects were: Availability when needed was rated as satisfactory/very satisfactory (top 2 box score) by 92% of respondents which was on par with the previous two years (92% to 93%). Color of tap water: 81% gave top 2 box satisfaction ratings (84% in 2010). Water pressure: 81% gave top 2 box satisfaction ratings (80% in 2010). Price and taste were the two areas of concern. Price charged had the lowest top 2 box satisfaction score (46%, down 5% from 2010); Central US customers had a significantly lower score (36%). Taste was found satisfactory by only about half (53%, down 7% from 2010) of respondents; Central AZ has a significantly lower score (44%). 16% of interviewed customers reported service interruptions. The fewest water interruptions were reported by respondents in the Central AZ service area. Only 4% of respondents in Central AZ had interruptions in the last year compared to 24% in Southern AZ and 26% in the Central US. Within Central US, Ozark Mountain customers experienced significantly more water interruptions (75%). Water interruptions were resolved quickly in all areas as reported by 83% of affected respondents. 7 Key Findings & Recommendations

Water Services (Cont.) Advance notifications remained somewhat few or were not remembered Overall only 22% of respondents (down from 34% in 2010) with scheduled interruptions had received advance notifications. Customers in Central AZ were most likely to have received a notification (44%). Improve on notifying residents of scheduled water interruptions in advance. Preferred methods to improve notifications were: Send notice at least one week in advance (50%) Reminder call day of interruption (40%) Send notices via email (40%) Lower rates /dont increase rates and water filtration were the most often mentioned improvements to water services (17% and 16%, respectively). Central US residents continued to complain most about their water rates (21%) but were less concerned with the water filtration as compared to the other regions (12%). Overall, satisfaction and feedback with water service received was positive and on par with 2010. However, some additional concerns about high/rising prices and water quality (color and taste were) were noted. 8 Notification Sent to Respondents reporting SCHEDULED interruption TOTAL 2011 Central AZ Southern AZ Central US Yes 22%44%26%12% No 69%56%64%78% Not Applicable/No Interruption 9%0%10% Key Findings & Recommendations

Customer Billing Respondents reported a high level of satisfaction with customer billing, on par with 2010. Top satisfaction was reported with: My bill is easy to read: 88% (top 2 box agreement = agree or strongly agree; 91% in 2010) My bill is easy to understand: 87% compared to 90% in 2010 Residents in the Eastern AZ were less satisfied with adequate payment options (74% vs. 80% overall) and payment options easy to understand/use (74% vs. 82% overall). More than half of respondents (57%; down from 61% in 2010) stated they read information inserts in their bill sometimes or always. A lower rate of readership of information inserts was reported among respondents in Eastern AZ (46%). They appear to be less informed and less satisfied with the services they receive. While 80% stated they had no suggestions for improving billing, 10% mentioned lower rates/dont increase rates. Website usage nearly doubled as 28% of interviewed customers have accessed the website (up from 15% in 2010). Those who used the website services were very satisfied. Online services utilized by most were: Access to account information online (79%; up 2%) Pay online by credit card (62%; up 2%) Forms online to establish new service saw the biggest increase in usage (32% vs. 20% in 2010) Satisfaction with most of the online services was high (72% to 83% somewhat to very satisfied), the exception being ease to receive customer support (61%). It is important to note, however, that these satisfaction scores all fell from 3% to 8% in 2011. 9 Key Findings & Recommendations

Customer Service A third of respondents (34%) had contacted customer service via phone in 2011 (up 5%), while 26% visited an office (up 1%). Their experiences were very positive (factors rated at 80% to 88% satisfaction) and were on par with 2010. Overall experience was rated excellent/good by 78%, which was on par with 2010 (78%) and higher than 2009 (68%). Eastern AZ residents were least likely to have contacted customer service. Offering longer office hours past 5 PM on weekdays was requested by more then one quarter (29%). There were no significant differences between regions in terms of office hour preference. Wait time to speak to a live person should be no more than 4 to 5 minutes. A wait time of less than 4 minutes was considered acceptable by 56% of respondents. If the wait dropped to 2 minutes 86% of respondents would be satisfied. A wait time of more than 5 minutes was deemed unacceptable by 82%. Customer service in Spanish was not of great demand. However, customers in the Southern AZ service area (20%) were more likely to prefer being offered Spanish customer service compared to overall (11%). 10 Key Findings & Recommendations

Home Visits by Service Representative Only 8% of respondents reported receiving a home visit by a service representative within the last year. Home visits were rated satisfactory. Customers in Southern AZ reported receiving the most home visits by service representatives, with 15% stating they received at least one visit. This was on par with 2010 data. Eastern AZ and Central US received the fewest home visits; 97% and 93% of respondents respectively stated no service representative had come to their home. Most aspects of the service representatives home visit were rated highly, with agreement scores (agree/strongly agree) that services were performed well at 70% and higher. Kept informed of progress in resolving the problem, however, received a 64% satisfaction score and was lowest in Eastern AZ (25%). Overall satisfaction with service representatives home visits was 70% somewhat/very satisfied, a 14% drop as compared to 2010. 11 Key Findings & Recommendations

Customers were highly satisfied with water/ waste water facility on provides a safe water supply and provides a reliable water supply. Provides reliable water supply: 91% (top 2 box agreement = 91% of respondents stated they agree or strongly agree; slightly down from 93% in 2010). Provides a safe water supply: 83% slightly down from 86% in 2010. Encourages water conservation was up 2% (73%). The other elements of the company evaluation rated somewhat lower but still two thirds agreed that the company was a good neighbor (65%, down 3%) and/or is customer friendly (69%, down 4%). Similar to 2009 and 2010, good neighbor and customer friendly received lowest ratings in Eastern AZ (43% and 44% respectively). Those facilities with the lowest scores were Black Mountain (29% / 40%) and Gold Canyon (43% each). Company Evaluation 12 Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Key Findings & Recommendations

Company Evaluation More customers (47% and 59%) continued to feel that water and waste water/sewage costs were too high. Respondents in the Central AZ and Central US service area were least satisfied with their water prices (51% and 57% too high respectively), while Eastern AZ customers felt strongly that their waste water prices were too high (81%, up 5%). It is important to note that scores in Central AZ rose by 11% each while fewer people in Central US felt the costs were too high. 13 Top 2 Box Scores (4,5): 5 = Much too High Rates of Utilities (Top 2 box score: 4/5 = somewhat/much too high) Total Central AZ Southern AZ Eastern AZ Central US 2010 Water46%40%36%45%64% 2011 Water47%51%40%39%57% CHANGE+1%+11%+4%-6%-7% 2010 Waste water/sewer55%34%47%76%60% 2011 Waste water/sewer59%45%50%81%55% CHANGE+4%+11%+3%+5%-5% NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Key Findings & Recommendations

Overall Satisfaction with their facility was rated high with 78% of respondents being somewhat or very satisfied. This was on par with 2010. Eastern AZ received lowest satisfaction scores with only 58% of respondents satisfied with their facility. However, satisfaction levels among these customers continued on an upward trend (+2% from 2010 and significantly up from 42% in 2009). Company Evaluation 14 Top 2 Box Scores (4,5): 5 = Very Satisfied Key Findings & Recommendations

Satisfaction & Rate Hikes In 2011 customers feedback regarding their satisfaction with their water and/or waste water provider was positive. This was true for the overall satisfaction rating as well as for specific services tested such as water service, billing, customer service and home visits by service representatives. While most satisfaction ratings remained comparable to 2010 or improved slightly, there was some downward movement to note: Satisfaction with color, water taste and price charged fell by 3% to 7% Advanced notification of water interruptions fell by 12% Satisfaction with all aspects of online services fell by 3% to 8% Satisfaction with all aspects of service rep home visits fell by 8% to 16%; overall satisfaction fell 14% While several facilities have implemented rate hikes or are going through the formal process of getting rate increases approved, customer satisfaction with the overall company performance has remained consistent at 78% somewhat/very satisfied. However, satisfaction with the water prices decreased by 5%, primarily driven by low satisfaction levels in the Central US. It is essential to continue with public relations campaigns to help customers understand why rates are increasing, how it will benefit customers in the long run and that Liberty Water is a friend and good neighbor who works to improve and help the community. To alleviate the financial burden of the customers facing upcoming rate hikes, it is suggested to implement small rate increases gradually over time (preferred by 87%). There was considerable interest in information and involvement in the process for rate hikes. About half (52%) of the interviewed customers were somewhat or very likely to attend informational meetings. 15 Key Findings & Recommendations

Recommendations Water Services The main concern was price. Given that reducing prices may not be an option, it is essential for Liberty Water to continue with comprehensive public relations campaigns to increase customer understanding and acceptance of the rate increases. Look at improving taste, especially in Central AZ. Work to minimize water interruptions, specifically in the Central US and Southern AZ. Advance notification of scheduled interruptions or awareness of notifications was low. Continue to improve on notifying residents of scheduled water interruptions in advance possibly though different design and coloring schemes of notices. Customers requested reminders especially the day before and on the day of the outage. Utilize technology (phone calls/ email/ online postings) to notify and remind residents of outages. Website and Online Services Website usage was nearly double with 28% customers using it. While still high, satisfaction levels on all online factors were down in 2011. Continue to promote website and new services included. Look at updating website services and work to make them easier to use. Look into possibility of mobile/smart phone connectivity with the website. 16 Key Findings & Recommendations

Recommendations (Cont.) Customer Service Customers were overall satisfied with the service they received. Some measures to further improve customer satisfaction include: Offer longer office hours, being open past 5PM. Keep wait times to speak to a live person to less than 5 minutes, preferably to less than 2 minutes. Offer Spanish customer service specifically in the Southern AZ service area. Work to have satisfaction with service rep home visits bounce back from their 8% to 13% decline in 2011. Overall Company Overall Liberty Water received strong ratings on the various elements of the company evaluation. However, some aspects rated somewhat lower for certain areas: Improve perception of facilities as good neighbor and customer friendly, especially in Eastern AZ and for the Black Mountain and Gold Canyon facilities. Eastern AZ Those provided with waste water/sewer services in Eastern AZ tended to be least satisfied. Areas of improvement were: Provide more payment options and make payment options more user friendly. When communicating with customer, use additional methods including online/email besides inserts into the bill. Only 46% of respondent stated they read them sometime/always. Better educate them on the reasons for rate increases to offset their lack of satisfaction with current prices. Improvements to the website will be beneficial as this region had the lowest satisfaction scores for the website; specifically they want the site to be easier to navigate. Improve customer service and provide more hours of availability. 17 Key Findings & Recommendations

DETAILED FINDINGS: RESPONDENT PROFILES & NEW QUESTIONS 18

Respondent Profile 19 NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. TotalCentral AZSouthern AZEastern AZCentral US Contact Residence99% 100% Business1% 0% Gender Male52% 54%51%52%49% Female48% 46%49%48%51% Age 18 to 24 years 2%1%6%0%2% 25 to 34 years 13%16%21%2%13% 35 to 44 years 15%27%21%3%8% 45 to 54 years 13% 15%14%10% 55 to 64 years 22%16%22%30%18% 64 years or older 36%27%17%50% Household Income Under $25,000 8%2%18%3%9% $25,000 - $49,999 20%13%28%18%21% $50,000 - $74,999 18%20%21%14%17% $75,000 - $99,999 15%19%15%16%9% $100,000 - $149,999 9%13%4%8%10% $150,000 or more 5%4%2%7%5% Prefer not to say 26%29%12%34%29% Ethnicity White/Caucasian 75%69%55%87%89% Black/African-American 3%5%3%2%1% Asian or Pacific Islander 2%6%3%0% Native American/Alaska Native 0% Hispanic/ Latino (White/Caucasian) 11%10%28%2%4% Hispanic/ Latino (Black/African-American) 1% 0% Hispanic/ Latino (all other or multiple race) 1% 4%0% Other 3% 4%2% Prefer not to say 5% 2%8%4% Respondent Profile

20 NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. TotalCentral AZSouthern AZEastern AZCentral US Children in Household (Average per age) Under 3 years of age 1.171.191.101.331.21 3 to 5 years of age 1.241.221.361.001.15 5 to 9 years of age 1.371.221.521.501.43 10 to 12 years of age 1.201.221.251.111.08 13 to 17 years of age 1.391.641.241.141.33 Education Less than high school 2%1%4%0%2% High school/GED 16% 21%13%14% Professional school/training 5%2%7%4%5% Some college 27%25%32%23%28% Associate's Degree 8%10%7% Bachelor's Degree 24%23%18%27%26% Some Graduate School 4%8%2%4% Graduate School Degree 15%17%9%22%14% Years in Current Residence Less than one year 12%16%14%9%10% 1 to 5 years 37%45%40%32%31% 6 to 10 years 26%30%19%33%23% 11 to 20 years 19%7%17%25%26% More than 20 years 6%1%11%2%10% Dont know 0%1%0% Respondent Profile

Importance of Website in Spanish 21 Q13b. How important is it to you that Liberty Waters website is available in Spanish language? Respondents overall did not indicate a great need for the website to be available in Spanish, with only 19% stating that it was somewhat or very important. Southern AZ residents, however, were significantly more likely to indicate that the availability of the website in Spanish was important (30% somewhat or very important). Importance of Website in Spanish NOTE: Orange circled data indicates significant regional difference. Detailed Findings New

Environmental Friendliness 22 Q23. How important is it to you for [INSERT FACILITY BASED ON QFAC] to be environmentally friendly? Q24. Would you be open to incurring a slight rate increase to ensure high environmentally-friendly performance? Importance of Environmental FriendlinessOpenness to Rate Increase to Ensure Environmental Friendliness NOTE: Orange circled data indicates significant regional difference. The vast majority of respondents indicated that it is somewhat or very important for their water/waste water provider to be environmentally friendly (92%). Residents of Central and Southern Arizona were significantly more likely to state that it is very important (69% and 72%, respectively vs. 66% overall). Although respondents thought it was important for their utility company to be environmentally friendly, only 47% were somewhat or very open to incurring a slight rate increase to ensure high environmentally-friendly performance. Residents of Central and Southern Arizona were significantly more likely to be very open to this idea (17% and 25% respectively v. 16% overall) compared with other regions. Detailed Findings New

DETAILED FINDINGS: OVERALL FINDINGS 23

Suggestions for Improvements 2009 (N=1000) 2010 (N=1003) 2011 (N=1007) Difference from 2010 Positive Comments (NET) 71%68%69%+1% Good/Like it (general) 68%65%66%+1% Good water quality 8%3%1%-2% Reasonable cost 4%1% 0% Negative Comments (NET) 36%29%35%+6% Cost/expensive 24%20%25%+5% Poor water quality 8%6% 0% Low water pressure 4%2% 0% Awareness & Perception 24 A1. What is the name of the company that provides water and/or waste water service to your household/business? A2. How would you describe your water and/or waste water service company and the services it provides? Familiarity with the water and/or waste water provider remained high. An obvious shift from the association with the local facility name to the newly branded Liberty Water name (72%) could be seen. Eastern Arizona tended to be most familiar with their facility name while respondents in the other three regions tended to associate more strongly with the Liberty Water name (73% to 80%). When asked to describe their provider, 69% of comments were positive. Overall/general positive comments (66%) were on par with the previous years. Mentions of good water quality decreased, while negative comments overall and cost/expensive increased by 5% to 6% each. Name of Water/Waste Water Provider NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Significantly Higher Correct Local Facility Name/Abbreviation: Eastern AZ (26%) Liberty Water/Algonquin: Central AZ (83%); Southern AZ (77%); Central US (73%) Detailed Findings Overall

Water Services Satisfaction 25 1. Please rate your water services in the following areas by using a 5-point scale with 5 being Very Satisfactory and 1 being Not Satisfactory At All. Respondents continued to be most satisfied with the water availability when needed, with 92% giving it a 4 or 5 (where 5 = Very satisfactory). Other highly rated aspects of water service were color (81%), water pressure (81%) and smell (77%). Respondents were not only least satisfied with the price charged (46%) and taste (53%), but both of these factors were lower in 2011 than they were in 2010 (down 5% to 7% each). Customers of facilities in Southern AZ were the most satisfied with the price charged (54% somewhat or very satisfied). Central AZ residents were the least satisfied with taste (44% somewhat or very satisfied). Top 2 Box Scores (4,5): 5 = Very Satisfactory Significantly Higher Top 2 Box Scores Taste: Central US (65%)/ Southern AZ (54%) vs. Central AZ (44%) Availability when needed: Central AZ (94%) vs. Southern AZ (89%) Price charged: Southern AZ (54%) vs. Central AZ (43%) / Central US (36%) NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Water Services Interruptions 26 Water Interruption Within Last YearWater Interruption Resolved Quickly 2. Within the last year, have you had any interruptions to your water service? 3. Was your water service interruption problem resolved quickly? 4. Being as detailed as possible, please tell us how and why your water interruption problem was not resolved quickly. Fewer than 1 out of 5 customers (16%) reported a water interruption within the last year. Those in the Central Arizona service area reported significantly fewer interruptions (4%) as compared to Central US (26%) and Southern AZ (24%). Water interruptions were generally resolved quickly (83%). Significantly Higher Water Interruption Central US (26%) / Southern AZ (24%) vs. Central AZ (4%) Why Not Resolved Quickly (N = 18) Resolution took too long (4 mentions) No explanation for interruption (1 mentions) No notification of service interruption (1 mentions) Detailed Findings Overall

Water Services Interruptions Notification 27 5. Are you notified in advance when scheduled interruptions to water service will occur? 6. In which of the following ways could [INSERT FACILITY BASED ON ZIP CODE] improve their notifications of scheduled service interruptions? You may select all that apply. Among the customers who had experienced a scheduled water service interruption in the last year, 22% recalled receiving a notification in advance. Significantly higher than previous years, two-thirds (69%) reported they had not received advance notification. This may indicate that advance notifications were not provided consistently or that residents did not notice them among other mailings or information. Customers requested a number of improvements to advance notifications. Send notice at least one week in advance (50%) was considered the most important followed by reminder call day of interruption (40%) and send notices by email (40%). Advance Notification of Water InterruptionsImprovements of Notifications of Scheduled Service Interruptions NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Water Services Improvements 28 NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. * Facilities in Eastern AZ provide Sewer/Waste Water service only. Suggestions 2009 Total 2010 Total 2011 Results Total Central AZ Southern AZ Eastern AZ* Central US Water filtration (improve taste/smell/color) 14% 16%18%16%-12% Lower rates/ don't increase rates 11%14%17%18%13%-21% Improve water pressure 7%4% 2%5%- No suggestions/fine as is 61%63%58%59%60%-55% Over half of the respondents (58%) had no suggestions on how to improve their water service, feeling it was fine as is. Among the improvements suggested were water filtration (improve taste/smell/color) mentioned by 16% of customer. Lower rates/dont increase rates was mentioned by 17% of customers with a significantly higher response in the Central US service area (21%). 7. Do you have any suggestions on how [INSERT FACILITY BASED ON ZIP CODE] could improve their water services? Detailed Findings Overall

Customer Billing Satisfaction 29 8a-d. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements. Top 2 Box Scores (4,5): 5 = Strongly Agree Customer satisfaction with billing remained high with 80% or more of interviewed customers stating they somewhat or strongly agreed that they were satisfied with the customer billings received. Eastern AZ received significantly lower satisfaction scores compared with other regions for adequate payment options provided and payments options are easy to understand/use (74% each). Top 2 Box Scores Central AZ Southern AZ Eastern AZ Central US Bill easy to read 89%88%87%88% Bill easy to understand 86%87%85%89% Adequate payment options provided 84% 74%78% Payment options easy to understand/ use 86%85%74%81% NOTE: Orange circled data indicates significant change/ difference compared to other year(s). NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Detailed Findings Overall

Customer Billing Information/Services 30 9. How often do you read the informational inserts included in your bill? Over half of respondents (57%) stated they read the information inserts in their bill sometimes or always. A slight downward trend from2009 can be seed (down 5% over last 2 years). Residents of Central US and Southern AZ were more likely to always read these inserts. Read Info Inserts in Bill NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Significantly More Likely to Always Read Inserts Central US (33%) / Southern AZ (31%) vs. Central AZ (23%) / Eastern AZ (18%) Detailed Findings Overall

Customer Billings Improvements 31 11. Do you have any suggestions for improving the billing? When asked about suggestions to improve customer billings, the majority of respondents did not have any improvements and felt it was fine as is (80%). Lower rates/dont increase rates was mentioned by 10%, up significantly from previous years (7% in 2009 and 6% in 2010). Other comments regarding improvements related to online and automated payment options (3%) and making the bills easier to understand (2%) were on par with last year. *Mentions 2%+ shown NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Suggestions for Improvements 2009 Total 2010 Total 2011 Total Difference from 2010 Lower rates/Don't increase rates7%6%10%+4% Improve or implement electronic/online/paperless billing 10%4%3%-1% Make bill easier to understand1%2% 0% No suggestions/fine as is74%82%80%-2% Detailed Findings Overall

Website Online Services Almost double the number of customers reported they had accessed the website compared with last year (28% vs. 15%). Significantly more of those in the Central AZ service area stated they had accessed the website (40%). The online services used by most was access to account information (79%) followed by pay online by credit card (62%). Significantly more customers used the forms online to establish new service than last year (32% vs. 20%). 32 Accessed Website Significantly Higher: Accessed Website Yes: Central AZ (40%) Online Services Used 10N1. Have you accessed [INSERT FACILITY BASED ON QFAC]s website? 10N2. The following services are available to [INSERT FACILITY BASED ON QFAC] customers. Please tell me if you have used any of them? NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Satisfaction with Website Online Services 33 Satisfaction with Online Services Used Top 2 Box Scores (4,5): 5 = Very Satisfied Suggestions for improvements (N = 286) 9% Improve user interface/easier to navigate 87% No suggestions/fine as is 10a. Using a 5-point scale where 5 is Very Satisfied and 1 is Very Dissatisfied, please tell me how satisfied you are with the new [INSERT FACILITY BASED ON QFAC] website. 10b. Do you have any suggestions for improving [INSERT FACILITY BASED ON QFAC] website and/or online services? Satisfaction with the online services customers had used was high. However, it should be noted that satisfaction for all factors fell by 3% to 7% as compared to 2010 data. Ease to access account information received the highest satisfaction rating with 83% of customers indicating they were very or somewhat satisfied. The only area that received a relatively low score was ease to receive customer support (61%). Not many customers had improvement suggestions for the website (87% had no suggestions and/or stated the site was fine as is). Those who had suggestions asked to improve user interface/easier to navigate. NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Customer Service Calls & Visits 34 11b. To the best of your recollection, how many times have you called or visited the [INSERT FACILITY BASED ON ZIP CODE] business office within the last year? The majority of respondents did not have any customer service contact within the last year: 66% indicated they had not called and 74% stated they had not visited the business office. Among those who had contact, either by phone and/or office visit, the mean number of interactions increased (2.42 calls and 2.17 office visits in 2011) as compared to previous years (2.13 and 2.15 respectively). Times Called Business Office Mean = 2.25 (2009); 2.13 (2010); 2.42 (2011); among those who have called within last year Times Visited Business Office Mean = 2.06 (2009); 2.15 (2010); 2.17 (2011); among those who have visited within last year NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Customer Service Satisfaction 35 12a. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about [INSERT FACILITY BASED ON ZIP CODE]s customer service. If you have called or visited the office more than once in the last year, please think only about your last contact with the [INSERT FACILITY BASED ON ZIP CODE] business office. Among those customers who reported they had contact with customer service in the last year, satisfaction was strong and on par with 2010 scores across all aspects tested. All scores except for staff handle request quickly remained significantly higher than 2009 scores. Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Customer Service Hours & Wait Time 36 12b. What would you consider more convenient office hours? 12c. How long are you willing to wait to speak to a live person? Customers who did not agree strongly that the office hours were convenient were asked what they felt would be more convenient hours. Longer weekday hours was mentioned by 29%, followed by Saturday hours (8%) and opening early during the week (4%). On average, respondents reported that an acceptable wait time for a live person was approximately four minutes (mean of 3.99 minutes), a slight increase from 2010 (3.69 minutes). With 82% of respondents feeling an acceptable wait time is no more than five minutes, Liberty Water should strive to keep wait times below this mark. NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. More Convenient Time 2009 (N=237) 2010 (N=210) 2011 (N=182) Difference from 2010 Weekday hours: late open/past 5PM 32%27%29%+2% Saturday hours: half/full day 11%7%8%+1% Weekday hours: early open/before 8AM 9%4% 0% Office hours are fine20%25%23% -2% Acceptable Wait Time for Live Person Mean = 3.86 (2009); 3.69 min. (2010); 3.99 min. (2011) NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Customer Services Overall Experience 37 13. Overall, how would you rate your experience with the customer service you received? If you have called or visited the office more than once in the last year, please think only about your last contact with the [INSERT FACILITY BASED ON ZIP CODE] business office. 14. Do you have any suggestions for improving customer service? On par with 2010, slightly more than three fourths of respondents were satisfied with their overall customer service experience (78% excellent/good). Respondents had few suggestions on how to improve customer service; 87% had no suggestion (+3% from 2010). The few comments given centered around being polite/friendly/understanding (3%) and be more professional/knowledgeable (2%). Satisfaction With Overall Experience Suggestions for Improvements 2009 Total 2010 Total 2011 Total Difference from 2010 Improve communication w/customers (service follow-up, shutoffs, etc) 2%3%1%-2% Be more polite/ friendly/ understanding 5%3% 0% Speak English better/ English as a default language 1%2%1%-1% Be more professional/ knowledgeable 5%2% 0% No suggestions/fine as is 77%84%87%+3% NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Customer Services Spanish 38 13a. If customer service were available in Spanish would you take advantage of it? Q13b. How important is it to you that Liberty Waters website is available in Spanish language? Respondents did not indicate a great need for customer service communications in Spanish, with only 11% stating they prefer Spanish over English. Southern AZ continued to be more interested in Spanish customer service interaction (20%). Only 19% of respondents indicated that it was somewhat or very important for the website to be available in Spanish. Residents of Southern and Central AZ, however, were significantly more likely to rate this as somewhat or very important (30% and 15% respectively). Customer Service in SpanishImportance of Website in Spanish NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Service Rep Home Visits 39 14b. How many times has an [INSERT FACILITY BASED ON ZIP CODE] employee visited your home to resolve a problem within the last year? The vast majority of respondents had no service representative visit their home within the last year (90% none), a significant decrease from previous years (93%). Of those who had a representative visit, the mean number of visits was 1.48. Number Called Business Office Mean = 1.28 (2009); 1.52 (2010); 1.48 (2011); among those who had a service rep visit their home within last year NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Service Rep Home Visits Satisfaction 40 15. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about your in home service visit. If an [INSERT FACILITY BASED ON ZIP CODE] employee has visited your home more than once within the last year, please think only about your last visit. Satisfaction with service representative home visits was high on most aspects. While satisfaction was down compared to 2010, this change was for the most part not significant. The one exception was happy about how soon service visit was scheduled, which was down a significant 16% as compared to last year. Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Service Rep Home Visits Overall Satisfaction & Improvements 41 16. Overall, how would you rate your experience with the service visit to your home using a 5-point scale with 5 being Very Satisfactory and 1 being Not Satisfactory At All? If you had more than one visit in the last year, please think only about your last visit. Overall satisfaction with the service rep home visits was strong (70% somewhat / very satisfied), but was down from the 84% satisfaction score given in 2010. Overall Satisfaction With Service Visit Detailed Findings Overall

Company Evaluation Satisfaction 42 18. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about [INSERT FACILITY BASED ON ZIP CODE]. Respondents agreed that their water service facility provides a reliable water supply (91%, top 2 box agree/strongly agree) followed by provides a safe water supply (83%). Encourages water conservation, which placed third in satisfaction, was up as compared to previous years (73%). Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Company Evaluation Utility Rates 43 19. For each of the following utility services, please indicate if you feel the rates charged are much too high, somewhat too high, just right, somewhat low, or very low. When comparing the perception of pricing for different utilities and services that respondents received, those considered somewhat/much too high continued to be television (63%), electricity (60%) and waste water/sewer (59%). Waste water/sewer saw a significant jump from 55% in 2010 to 59% of respondents feeling their rate is too high. This increase was driven mainly by customers in the Eastern AZ service area (81%). Central AZ respondents were most satisfied with their waste water/ sewer rates as only 45% stated the rates were somewhat/much too high. Top 2 Box Scores (4,5): 5 = Much too High NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Detailed Findings Overall

Company Evaluation Overall Satisfaction 44 20. Overall, how satisfied are you with [INSERT FACILITY BASED ON ZIP CODE]? Respondents were satisfied with their water/waste water provider overall, with 78% of respondents stating they were somewhat/very satisfied. Eastern AZ was least satisfied (58%) with all other regions reporting top 2 box satisfaction scores of 79% or higher. Overall Satisfaction Detailed Findings Overall

Company Evaluation Overall Satisfaction 45 20a. Being as specific as possible, why did you say you are [INSERT FROM Q20] with [INSERT FACILITY BASED ON ZIP CODE]? Those somewhat/very satisfied with the provider were so because they have never had a complaint (37%), the service is satisfactory/ good/ excellent (8%), and reliable/no service interruptions (8%). However, 20% of satisfied respondents stated that they felt the cost was too high; mainly those from Eastern AZ (30%). Not surprisingly, cost (77%) was the main reason why respondents were dissatisfied (not satisfied at all/somewhat dissatisfied). Other negative comments were related to customer service (9% poor/unfriendly/uncaring customer service) and the water quality (8% odor from sewer/sewage processing facility, 5% smell/taste of water and 7% water is cloudy/contaminated/poor quality/hard). NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Suggestions for Improvements 2009 Total 2010 Total 2011 Total Difference from 2010 Why SatisfiedN=743N=777N=775 Reliable/No service interruptions 14%6%8%+2% Service is satisfactory/good/excellent 14%10%8%-2% Never had a problem/complaint 26%37% 0% Cost is too high/rate increases 11%21%20%-1% Cost is reasonable 10%4%5%+1% Good/friendly/courteous customer service 8% 6%-2% Water quality is good 6%4% 0% Prompt, considerate repair service 4%2%3%+1% Water is cloudy/contaminated/poor quality/hard 4%3% 0% Why Not SatisfiedN=176N=124N=152 Cost is too high/rate increases 63%72%77%+5% Raising the rates 14%0% Odor from sewer/sewage processing facility 14%10%8%-2% Poor/unfriendly/uncaring customer service 11%6%9%+3% They are dishonest/crooked/price gougers 11%4%6%+2% Charged for service even when absent 7%0%3%+3% Water is cloudy/contaminated/poor quality/hard 4%5%7%+2% Smell/taste of water 4%6%5%-1% Detailed Findings Overall

Rate Hikes 46 Likelihood of Attending Informational Meeting 21a. If rate case informational meetings were held in your community how likely would it be that you would attend? 21c. Regarding rate increases, given the opportunity would you prefer: In terms of customer involvement in potential rate hikes, about half (52%) stated they were very or somewhat likely to attend an informational meeting. Those in Eastern AZ indicated a significantly higher likelihood to attend (60%) compared to customers in the other service areas. In case of rate increases the vast majority (87%) preferred having the increases spread out over time with small increases occurring every year. Rate Hike Preference Detailed Findings Overall

CENTRAL ARIZONA (LPSCO) Business Manager: Matthew Garlick 47

Awareness & Perception 48 A1. What is the name of the company that provides water and/or waste water service to your household/business? A2. How would you describe your water and/or waste water service company and the services it provides? Name of Water/Waste Water Provider NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. * Some number may not add up due to rounding Significantly Higher Local Facility Name/Abbreviation: Residents 6 years or more (19%) Liberty Water/Algonquin: Residents 5 years or less (90%) Suggestions for Improvements 2009 (n=250) 2010 (N=251) 2011 (N=253) Difference from 2010 Positive Comments (NET) 83%82%73%-9% Positive general82%79%69%-10% Water quality8%5%1%-4% Customer service2% 4%+2% Cost is reasonable6%1% 0% Negative Comments (NET) 16% 32%+16% Cost is too high5%8%18%+10% Water quality10%7%9%+2% Customer service2%1%4%+2% Familiarity with their water and waste water provider remained high. An obvious shift from the association with the local facility name to the newly branded Liberty Water name (83%) was noted. When asked to describe the provider, most comments were positive (73%) and general with 69% respondents saying good/like it. Also mentioned was good customer service (4%). The number of respondents reporting negative comments was significantly higher this year (32% vs. 16% in 2009 and 2010). Cost is too high (18%) was the leading reason for negative associations, followed by water quality (9%). Matthew Garlick Central AZ

Water Services Satisfaction 49 1. Please rate your water services in the following areas by using a 5-point scale with 5 being Very Satisfactory and 1 being Not Satisfactory At All. Respondents generally rated the water services they received highly. Availability when needed received the highest top 2 box score (94%; 4/5, where 5 = very satisfactory) followed by water pressure (85%) and color (81%). Taste of tap water (44%) and price charged (43%) received the lowest satisfaction scores, both of which were significantly lower as compared to past years. Top 2 Box Scores (4,5): 5 = Very Satisfactory NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Matthew Garlick Central AZ

Water Services Interruptions 50 Water Interruption Within Last YearWater Interruption Resolved Quickly *Caution: small sample size. 2. Within the last year, have you had any interruptions to your water service? 3. Was your water service interruption problem resolved quickly? 4. Being as detailed as possible, please tell us how and why your water interruption problem was not resolved quickly. Consistent with previous years, only 4% of respondents had a water service interruption in the past year. Among these, 100% stated the interruption was resolved quickly. Why Not Resolved Quickly (N = 0) N/A Matthew Garlick Central AZ

Water Services Interruptions Notification 51 *Caution: small sample size. 5. Are you notified in advance when scheduled interruptions to water service will occur? 6. In which of the following ways could [INSERT FACILITY BASED ON ZIP CODE] improve their notifications of scheduled service interruptions? You may select all that apply. Consistent with 2010 findings, of the nine customers who had a water interruption in the last year four (44%) stated they received an advance notification of the scheduled interruptions. In terms of improvements for scheduled service interruptions, the top improvement requested was send notices by email (78%). Advance Notification of Water InterruptionsImprovements of Notifications of Scheduled Service Interruptions Matthew Garlick Central AZ

Water Services Improvements 52 NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. * Some number may not add up due to rounding Over half of the respondents (59%) had no suggestions on how to improve their water service, feeling it was fine as is. Among the improvements suggested were water filtration (improve taste/smell/color) mentioned by 18% of customers. Lower rates/dont increase rates, also mentioned by 18% of customers, was significantly higher as compared to previous years. 7. Do you have any suggestions on how [INSERT FACILITY BASED ON ZIP CODE] could improve their water services? Suggestions for Improvements 2009 (n=250) 2010 (n=250) 2011 (n=251) Difference from 2010 Water filtration (improve taste/ smell/ color)/ soften water 16% 18%+3% Lower rates/ don't increase rates6%11%18%+7% Improve water pressure4%2% 0% Electronic/ online billing1%2%1%-2% Improve cold water temperature fluctuations 3%2% 0% More customer outreach/better communications 1%0%2%+2% No suggestions/fine as is66% 59%-8% Matthew Garlick Central AZ

Customer Billing Satisfaction 53 8a-d. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements. Top 2 Box Scores (4,5): 5 = Strongly Agree Customer satisfaction with billing remained high with 84% or more of interviewed customers somewhat or strongly agreeing that they were satisfied with the customer billings received. Compared with 2009, customers were more satisfied with the payment options provided (84% in 2011). Conversely, 2011 respondents were significantly less likely to agree that bills are easy to understand (86% somewhat or strongly agree vs. 92% in 2010 and 2009). NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Matthew Garlick Central AZ

Customer Billing Information/Services 54 9. How often do you read the informational inserts included in your bill? Over half of respondents (58%) stated they read the information inserts in their bill sometimes or always. These results were slightly lower than previous years. Customers aged 18-44 years and residents living in the area for 5 years or less were significantly more likely to have never read the information inserts (24% and 25% respectively vs. 20% overall). Read Info Inserts in Bill Significantly Higher: Never Read Info Inserts in Bill 18 to 44 year old (24%), Residents 5 years or less (25%) Matthew Garlick Central AZ

Customer Billings Improvements 55 11. Do you have any suggestions for improving the billing? When asked about suggestions to improve customer billings, the majority of respondents did not have any improvements and felt it was fine as is (85%). Lower rates/dont increase rates and improve or implement electronic/online/paperless billing were mentioned most by 5% of customers each. NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Suggestions for Improvements 2009 (N=250) 2010 (N=251) 2011 (N=253) Difference from 2010 Improve or implement electronic/online/paperless billing 13%7%5%-2% Lower rates/don't increase rates2% 5%+3% Automatic payments via bank draft2%1% 0% Make bill easier to understand0%2% 0% No suggestions/fine as is76%83%85%+2% Matthew Garlick Central AZ

Website Online Services Significantly more customers reported they had accessed the Liberty Water website this year compared with last year (40% vs. 21%). Younger respondents were significantly more likely to have accessed the website (57%). The online service used by most was access to account information (81%). Significantly more customers are using the paperless bill statement online compared to last year (55% vs. 36%). 56 Accessed Updated Website Significantly Higher: Accessed Website Yes: 18 to 44 years (57%) Online Services Used 10N1. Have you accessed [INSERT FACILITY BASED ON QFAC]s website? 10N2. The following services are available to [INSERT FACILITY BASED ON QFAC] customers. Please tell me if you have used any of them? NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Matthew Garlick Central AZ

Satisfaction with Website Online Services 57 Satisfaction with Online Services Used Top 2 Box Scores (4,5): 5 = Very Satisfied Suggestions for improvements (N = 101) 10% Improve user interface/easier to navigate 86% No suggestions/fine as is 10a. Using a 5-point scale where 5 is Very Satisfied and 1 is Very Dissatisfied, please tell me how satisfied you are with the new [INSERT FACILITY BASED ON QFAC] website. 10b. Do you have any suggestions for improving [INSERT FACILITY BASED ON QFAC] website and/or online services? Satisfaction with most of the online services customers had used was high. Ease to access account information (81%) and ease to pay your bill online (80%) received the highest satisfaction ratings, with about eight in ten customers indicating they were very or somewhat satisfied. The only area that received relatively lower scores was ease to receive customer support (58%). Not many customers had improvement suggestions for the website (86% had no suggestions and/or stated the site was fine as is). Those who had suggestions asked to improve user interface/easier to navigate. Matthew Garlick Central AZ

Customer Service Calls & Visits 58 11b. To the best of your recollection, how many times have you called or visited the [INSERT FACILITY BASED ON ZIP CODE] business office within the last year? The majority of respondents did not call (65%) or visit (79%) the business office within the last year. Respondents who had contacted the business office had both called or visited the office twice, on average (2.41 calls and 1.83 visits). While the mean number of calls was higher in 2011 (up 0.38), the mean number of visits fell slightly (down 0.10). Times Called Business Office Mean = 1.97 (2009); 2.03 (2010); 2.41 (2011); among those who have called within last year Times Visited Business Office Mean = 1.79 (2009); 1.93 (2010); 1.83 (2011); among those who have visited within last year Matthew Garlick Central AZ

Customer Service Satisfaction 59 12a. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about [INSERT FACILITY BASED ON ZIP CODE]s customer service. If you have called or visited the office more than once in the last year, please think only about your last contact with the [INSERT FACILITY BASED ON ZIP CODE] business office. Among those customers who reported they had contact with customer service in the last year, satisfaction was strong. Compared with 2009, customers were now more satisfied with reasonable time waiting (89% vs. 76% in 2009). Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Matthew Garlick Central AZ

Customer Service Hours & Wait Time 60 12b. What would you consider more convenient office hours? 12c. How long are you willing to wait to speak to a live person? Customers who did not agree that the office hours were convenient were asked what they felt would better. Longer weekday hours (35%) and office hours on Saturdays (12%) were suggested; keeping the office open later on weekdays was up 14% from 2010. Compared to 2010, fewer suggestions regarding better office hours were made and more customers indicated the current hours were fine (29%). On average, respondents reported that an acceptable wait time for a live person was approximately four minutes (mean of 4.01 minutes), a slight increase from 2010 (3.79 minutes). With 85% of respondents feeling an acceptable wait time is no more than five minutes, Liberty Water should strive to keep wait times below this mark. NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. More Convenient Time 2009 (N=60) 2010 (N=42) 2011 (N=49) Difference from 2010 Weekday hours: late open/past 5PM 45%21%35%+14% Saturday hours: half/full day 10%7%12%+5% Weekday hours: early open/before 8AM 13%0%4%+4% Office hours are fine13%24%29% +5% Acceptable Wait Time for Live Person Mean = 4.00 min (2009); 3.79 min. (2010); 4.01 min. (2011) Matthew Garlick Central AZ

Customer Services Overall Experience 61 13. Overall, how would you rate your experience with the customer service you received? If you have called or visited the office more than once in the last year, please think only about your last contact with the [INSERT FACILITY BASED ON ZIP CODE] business office. 14. Do you have any suggestions for improving customer service? Slightly more than three fourths of respondents were satisfied with their overall customer service experience (77% excellent/good). Respondents had few suggestions on how to improve customer service; 83% had no suggestion. The few comments given centered around being polite/friendly/understanding (5%). Satisfaction With Overall Experience Suggestions for Improvements 2009 (n=97) 2010 (N=99) 2011 (n=101) Difference from 2010 Be more polite/ friendly/ understanding 5%3%5%+2 Speak English better/English as a default language 3% 0%-3 Be more professional/ knowledgeable 1%3%1%-2 Improve communication w/customers (service follow-up, shut offs, etc) 3%2%0%-2 Increase online services4%1% 0 No suggestions/fine as is 77%86%83%-3 NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Matthew Garlick Central AZ

Customer Services Spanish 62 13a. If customer service were available in Spanish would you take advantage of it? Q13b. How important is it to you that Liberty Waters website is available in Spanish language? Respondents did not indicate a great need for customer service communications in Spanish, with only 9% stating they prefer Spanish over English. Only 15% of respondents indicated that it was somewhat or very important to have the website available in Spanish. Not surprisingly, Hispanics were significantly more likely to prefer customer service and website in Spanish (35% each). Customer Service in SpanishImportance of Website in Spanish Significantly Higher Yes, I prefer Spanish: Hispanics (35%) Website in Spanish Very/Somewhat Important: Hispanics (35%) Matthew Garlick Central AZ

Service Rep Home Visits 63 14b. How many times has an [INSERT FACILITY BASED ON ZIP CODE] employee visited your home to resolve a problem within the last year? The vast majority of respondents had no service representative visit their home within the last year (88%). Of those who had a representative visit, the average number of visits was 1.13, consistent with 2010. Number Called Business Office Mean = 1.44 (2009); 1.13 (2010); 1.13 (2011); among those who had a service rep visit their home within last year Matthew Garlick Central AZ

Service Rep Home Visits Satisfaction 64 *Caution: small sample size. 15. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about your in home service visit. If an [INSERT FACILITY BASED ON ZIP CODE] employee has visited your home more than once within the last year, please think only about your last visit. Satisfaction with service representative home visits was high on most aspects. While satisfaction was slightly down on most aspects compared to 2010, this change was not significant. Top 2 Box Scores (4,5): 5 = Strongly Agree Matthew Garlick Central AZ

Service Rep Home Visits Overall Satisfaction & Improvements 65 *Caution: small sample size 16. Overall, how would you rate your experience with the service visit to your home using a 5-point scale with 5 being Very Satisfactory and 1 being Not Satisfactory At All? If you had more than one visit in the last year, please think only about your last visit. Overall satisfaction with home service visits dropped compared to 2010 (74% somewhat or very satisfied vs. 86% in 2010), although this difference was not statistically significant. Overall Satisfaction With Service Visit Matthew Garlick Central AZ

Company Evaluation Satisfaction 66 18. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about [INSERT FACILITY BASED ON ZIP CODE]. Respondents agreed that their water service facility provides a reliable water supply (93%, top 2 box agree/strongly agree) followed by provides a safe water supply (81%). While all agreement scores were down compared to 2010, is a good neighbor was significantly lower at 70%. Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Significantly Higher Is customer friendly: Residents 5 years or less (84%) Encourages water conservation: Residents 5 years or less (77%) Matthew Garlick Central AZ

Company Evaluation Utility Rates 67 19. For each of the following utility services, please indicate if you feel the rates charged are much too high, somewhat too high, just right, somewhat low, or very low. When comparing the perception of pricing for different utilities and services that respondents received, those considered somewhat/much too high continued to be electricity (77%) and television (67%). Water and waste water/sewer both saw a significant jump of respondents considering their rate is too high. Non-Hispanics and residents of the area for 6 years or more were significantly more likely to perceive both of these utilities as too high. Top 2 Box Scores (4,5): 5 = Much too High NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Significantly Higher Water: Non-Hispanics (54%), Residents 6 years or more (61%) Waste Water/Sewer : Non-Hispanics (50%), Residents 6 years or more (54%) Matthew Garlick Central AZ

Company Evaluation Overall Satisfaction 68 20. Overall, how satisfied are you with [INSERT FACILITY BASED ON ZIP CODE]? Respondents were satisfied with their water/waste water provider overall, with 83% of respondents stating they were somewhat/very satisfied (-5% from 2010). Overall Satisfaction Matthew Garlick Central AZ

Company Evaluation Overall Satisfaction 69 20a. Being as specific as possible, why did you say you are [INSERT FROM Q20] with [INSERT FACILITY BASED ON ZIP CODE]? Those somewhat/very satisfied with the provider were so because they have never had a problem/complaint (39%). However, a large percentage of respondents stated that they felt the cost was too high (18% of those who stated they were satisfied and 83% of those who stated they were not satisfied). It is important to note that among those dissatisfied, mentions of cost as a reason were more than double that from 2010. NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Suggestions for Improvements 2009 (N=250) 2010 (N=251) 2011 (N=253) Difference from 2010 Why SatisfiedN=225N=219N=209 Never had a problem / complaint33%39% 0 Cost is too high/rate increases6%14%18%+4 Service is satisfactory/ good/ excellent14%7%8%+1 Good/ friendly/ courteous customer service5%10%4%-6 Reliable/ no service interruptions20%6% 0 Cost is reasonable8%2%6%+3 Why Not SatisfiedN=9N=8N=23 Cost is too high/rate increases0%38%83%+45 Odor from sewer/sewage processing facility11%0%4%+4 Poor/unfriendly/uncaring customer service44%13%0%-13 Smell/taste of water11%0%13%+13 Water is cloudy/contaminated/poor quality/hard0%13%17%+5 Matthew Garlick Central AZ

Rate Hikes 70 Likelihood of Attending Informational Meeting 21a. If rate case informational meetings were held in your community how likely would it be that you would attend? 21c. Regarding rate increases, given the opportunity would you prefer: In terms of customer involvement in potential rate hikes, almost half (46%) stated they were very or somewhat likely to attend an informational meeting. In the case of rate increases the vast majority (85%) preferred having the increases spread out over time with small increases occurring every year. Rate Hike Preference Matthew Garlick Central AZ

SOUTHERN ARIZONA (BELLA VISTA, RIO RICO, NORTHERN SUNRISE, SOUTHERN SUNRISE) Business Manager: Martin Garlant 71

Awareness & Perception 72 A1. What is the name of the company that provides water and/or waste water service to your household/business? A2. How would you describe your water and/or waste water service company and the services it provides? Familiarity with their water and waste water provider was high as the number of respondents citing Liberty Water/Algonquin (77%) more than doubled as compared to 2010. While 17% instead named their correct local facility name/abbreviation, the number citing dont know fell (2% in 2011 vs. 17% last year). When asked to describe the provider, most comments were positive (78%) and general in nature (73%). While positive comments for customer service (8%) rose significantly in 2011, they were lower for water quality and reasonable cost as compared to 2009. Nearly a third (29%) of respondents mentioned negative comments: cost is too high (17%) was the leading reason for negative associations with a noticeable increase as compared to 2009 and 2010. Name of Water/Waste Water Provider NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Suggestions for Improvements 2009 (n=250) 2010 (N=252) 2011 (N=250) Difference from 2010 Positive Comments (NET) 77%78% 0% Positive general73%75%73%-2% Water quality9%4%2%-2% Cost is reasonable6%0%2%+2% Customer service4%3%8%+5% Negative Comments (NET) 26%24%29%+5% Cost is too high10% 17%+7% Water quality9%8% 0% Negative general2%4%3%-1% Customer service4% 0% Martin Garlant Southern AZ

Water Services Satisfaction 73 1. Please rate your water services in the following areas by using a 5-point scale with 5 being Very Satisfactory and 1 being Not Satisfactory At All. Respondents generally rated the water services they received highly. Availability when needed received the highest top 2 box score (89%; 4/5, where 5 = very satisfactory) but was slightly down (-3%). This was followed by water pressure (81%; up 5% as compared to 2010) and smell (80%, up 4%). While satisfaction with color was also at 80%, it is important to note that a downward trend in color continued (down 4% from 2010). Taste of tap water and price charged tied for the lowest satisfaction scores (54% each). Each of these factors also experienced a 6% to 8% decrease as compared to 2010. Top 2 Box Scores (4,5): 5 = Very Satisfactory Martin Garlant Southern AZ

Water Services Interruptions 74 Water Interruption Within Last YearWater Interruption Resolved Quickly 2. Within the last year, have you had any interruptions to your water service? 3. Was your water service interruption problem resolved quickly? 4. Being as detailed as possible, please tell us how and why your water interruption problem was not resolved quickly. Nearly a fourth (23%) of respondents had a water service interruption in the past year, which was on par with 2009 and 2010 data. Among these, 24% stated the interruption was not resolved quickly, an issue of increasing concern over the last two years. Among those stating their water interruption issue was not resolved quickly, resolution took too long was the primary reason given. Why Not Resolved Quickly (N = 14) Resolution took too long (4mentions) No explanation for interruption (1 mention) Dont know (1 mention) Other (8 mentions) NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Water Services Interruptions Notification 75 5. Are you notified in advance when scheduled interruptions to water service will occur? 6. In which of the following ways could [INSERT FACILITY BASED ON ZIP CODE] improve their notifications of scheduled service interruptions? You may select all that apply. Of the customers who had a water interruption in the last year, a fourth (26%) stated they received an advance notification of scheduled interruptions. This was down by 10% as compared to 2010. In terms of improvements for scheduled service interruptions, the top improvement requested was send notice at least one week in advance (47%) followed by reminder call day of interruption (40%). Advance Notification of Water InterruptionsImprovements of Notifications of Scheduled Service Interruptions NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Water Services Improvements 76 NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Over half of the respondents (60%) had no suggestions on how to improve their water service, feeling it was fine as is. Among the improvements suggested were lower rates/dont increase rates (13%) and improve water pressure (5%). 7. Do you have any suggestions on how [INSERT FACILITY BASED ON ZIP CODE] could improve their water services? Suggestions for Improvements 2009 (n=250) 2010 (n=251) 2011 (n=248) Difference from 2010 Lower rates/Don't increase rates9%11%13%+2% Improve water pressure6% 5%-1% Maintain better/repair facilities/lines2%0%2%+2% New/more water tower(s)/pumping station(s) 1%3%0%-3% No suggestions/fine as is58%61%60%-1% Martin Garlant Southern AZ

Customer Billing Satisfaction 77 8a-d. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements. Top 2 Box Scores (4,5): 5 = Strongly Agree Customer satisfaction with billing remained high with 84% or more of interviewed customers stating they somewhat or strongly agreed that they were satisfied with all of the factors tested. However, scores were slightly lower in 2011 as compared to 2010. While some scores were only lower by only 2%-3%, bill easy to understand and bill easy to read had more noticeably declines (8% and 6%, respectively). NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Customer Billing Information/Services 78 9. How often do you read the informational inserts included in your bill? Almost two thirds of respondents (62%) stated they read the information inserts in their bill sometimes or always. These results were relatively consistent with findings in 2010 (-1%), but nearly 9% lower than the 2009 level. It should be noted that those more likely to always read such inserts are longer term residents (38% 6+ year residents). Read Info Inserts in Bill Significantly Higher Always: Residents 6 years or more (38%) Martin Garlant Southern AZ

Customer Billings Improvements 79 11. Do you have any suggestions for improving the billing? When asked about suggestions to improve customer billings, the majority of respondents did not have any improvements and felt it was fine as is (84%), which was on par with the 85% received in 2010. Lower rates/dont increase rates was mentioned by 6%. Comments regarding improve or implement electronic/online/paperless billing continued its downward trend, down 2% compared to 2010 and down 13% compared to 2009. As noted in last years report, this is likely a reflection of changes and new services offered on the updated website. NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Suggestions for Improvements 2009 (N=250) 2010 (N=252) 2011 (N=250) Difference from 2010 Improve or implement electronic/online/paperless billing 15%4%2%-2% Lower rates/don't increase rates3% 6%+3% Make bill easier to understand1%3% 0% No suggestions/fine as is74%85%84%-1% Martin Garlant Southern AZ

Website Online Services Nearly a third (30%) of customers reported they had accessed the new Liberty Water website, which represented a 13% increase as compared to 2010. The online services used by most was access to account information (91%) followed by pay online by credit card (76%). Usage by new customers may also be on the rise considering access to forms online to establish new service rose by 9% in 2011 (up to 23%). 80 Accessed Updated WebsiteOnline Services Used 10N1. Have you accessed [INSERT FACILITY BASED ON QFAC]s website? 10N2. The following services are available to [INSERT FACILITY BASED ON QFAC] customers. Please tell me if you have used any of them? NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Satisfaction with the online services customers had used was high. Usefulness of information received the highest satisfaction rating (87% very or somewhat satisfied) and had the smallest downturn (-1%). Ease to access account information and overall user-friendliness of the website each received scores of 85%, but both had 8% to 9% declines as compared to 2010. The only area that received relatively lower scores was ease to receive customer support (68%), but this was the only factor to show a positive trend (up 11%). Not many customers had improvement suggestions for the website (85% had no suggestions and/or stated the site was fine as is). Those who had suggestions asked to improve user interface/easier to navigate and add bank transfer as a payment option. Satisfaction with Website Online Services 81 Satisfaction with Online Services Used Top 2 Box Scores (4,5): 5 = Very Satisfied Suggestions for improvements (N = 75) 13% Improve user interface/easier to navigate 85% No suggestions/fine as is 10a. Using a 5-point scale where 5 is Very Satisfied and 1 is Very Dissatisfied, please tell me how satisfied you are with the new [INSERT FACILITY BASED ON QFAC] website. 10b. Do you have any suggestions for improving [INSERT FACILITY BASED ON QFAC] website and/or online services? Martin Garlant Southern AZ

Customer Service Calls & Visits 82 11b. To the best of your recollection, how many times have you called or visited the [INSERT FACILITY BASED ON ZIP CODE] business office within the last year? Nearly half of respondents did not call (46%) or visit (49%) the business office within the last year. However those with 1+ visits were significantly higher in 2011 (51% 1+ visits vs. 45% and 38% in previous years). Those who called or visited 4+ times showed the most dramatic increases (21% and 28%, up 10% each). Respondents who had contacted the business office had both called or visited the office between two and three times, on average (2.77 calls and 2.57 visits). Times Called Business Office Mean = 2.41 (2009); 2.40 (2010); 2.77 (2011); among those who have called within last year Times Visited Business Office Mean = 2.46 (2009); 2.44 (2010); 2.57 (2011); among those who have visited within last year NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Customer Service Satisfaction 83 12a. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about [INSERT FACILITY BASED ON ZIP CODE]s customer service. If you have called or visited the office more than once in the last year, please think only about your last contact with the [INSERT FACILITY BASED ON ZIP CODE] business office. Among those customer who reported they had contact with customer service in the last year, satisfaction was strong and on par with 2010 across all aspects tested (within 2%). The one exception was convenient office hours, which showed a 5% increase in satisfaction as compared to 2010. Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Customer Service Hours & Wait Time 84 12b. What would you consider more convenient office hours? 12c. How long are you willing to wait to speak to a live person? Customers who did not agree strongly that the office hours were convenient were asked what they felt would be more convenient hours. Longer weekday hours (26%) was the most preferred hours extension option. On average, respondents reported that an acceptable wait time for a live person was just over four minutes (mean of 4.27 minutes), a slight increase from 2010 (3.95 minutes). With 79% of respondents feeling an acceptable wait time is no more than five minutes, Liberty Water should strive to keep wait times below this mark. NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. More Convenient Time 2009 (N=79) 2010 (N=83) 2011 (N=77) Difference from 2010 Weekday hours: late open/past 5PM 32%39%26%-13% Saturday hours: half/full day 15%10%9%-1% Weekday hours: early open/before 8AM 8%6%4%-2% Office hours are fine23%21% 0% Acceptable Wait Time for Live Person Mean = 3.99 min (2009); 3.95 min. (2010); 4.27 min. (2011) Martin Garlant Southern AZ

Customer Services Overall Experience 85 13. Overall, how would you rate your experience with the customer service you received? If you have called or visited the office more than once in the last year, please think only about your last contact with the [INSERT FACILITY BASED ON ZIP CODE] business office. 14. Do you have any suggestions for improving customer service? More than three fourths of respondents were satisfied with their overall customer service experience (80% excellent/good), which continued its upward trend (up 4% from 2010 and up 6% from 2009). Respondents had few suggestions on how to improve customer service; 88% had no suggestion (up 5% from 2010). The few comments given centered around being more polite and professional. Satisfaction With Overall Experience Suggestions for Improvements 2009 (n=140) 2010 (N=162) 2011 (n=177) Difference from 2010 Be more professional/ knowledgeable 6%3%2%-1% Be more polite/ friendly/understanding 6%3% 0% Improve communication w/customer 1%3%1%-2% Speak English better/as a default language 1%3%1%-2% No suggestions/fine as is 79%83%88%+5% NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Martin Garlant Southern AZ

Customer Services Spanish 86 13a. If customer service were available in Spanish would you take advantage of it? Q13b. How important is it to you that Liberty Waters website is available in Spanish language? Respondents continued to show a slight rise in preference for customer service in Spanish with one in five (20%, up 3%) now preferring it over English. The Rio Rico respondents showed a significantly higher interest in Spanish customer service (33%). Nearly a third (30%) felt a Spanish website was somewhat or very important. Customer Service in SpanishImportance of Website in Spanish NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Significantly Higher Prefer Spanish: Rio Rico (33%) Martin Garlant Southern AZ

Service Rep Home Visits 87 14b. How many times has an [INSERT FACILITY BASED ON ZIP CODE] employee visited your home to resolve a problem within the last year? Most respondents had no service representative visit their home within the last year (81% none). Of those who had a representative visit, the average number of visits was 1.73 which was on par with 2010 (1.74 visits). Number Called Business Office Mean = 1.22 (2009); 1.74 (2010); 1.73 (2011); among those who had a service rep visit their home within last year NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Service Rep Home Visits Satisfaction 88 15. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about your in home service visit. If an [INSERT FACILITY BASED ON ZIP CODE] employee has visited your home more than once within the last year, please think only about your last visit. While satisfaction with service representative home visits was still strong, 2011 levels were lower for all factors tested. While some decreases were small (as low as 3%), service rep arrived when scheduled saw the largest decline in satisfaction (-17%, down to 70%). This placed it as the second worst in satisfaction behind kept informed of progress in resolving problem (68%). Service rep knowledgeable received the highest satisfaction score (81%). Top 2 Box Scores (4,5): 5 = Strongly Agree Martin Garlant Southern AZ

Service Rep Home Visits Overall Satisfaction & Improvements 89 16. Overall, how would you rate your experience with the service visit to your home using a 5-point scale with 5 being Very Satisfactory and 1 being Not Satisfactory At All? If you had more than one visit in the last year, please think only about your last visit. Overall satisfaction with the service rep home visit fell noticeably in 2011; three fourths (76%) of respondents indicated they were somewhat/very satisfied which was a decrease of 11% as compared to 2010. Overall Satisfaction With Service Visit Martin Garlant Southern AZ

Company Evaluation Satisfaction 90 18. Using a 5-point scale where 5 is Strongly Agree and 1 is Strongly Disagree, please tell me how much you agree or disagree with each of the following statements about [INSERT FACILITY BASED ON ZIP CODE]. Respondents agreed that their water service facility provides a reliable water supply (91%, top 2 box agree/strongly agree) followed by provides a safe water supply (86%). While all agreement scores were relatively consistent with or up from 2010, encourages water conservation was significantly higher at 74% compared to 69% in 2010 and 58% in 2009. Top 2 Box Scores (4,5): 5 = Strongly Agree NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Significantly Higher Provides a safe water supply: At residence less than 5 years (91%) Encourages water conservation: Belle Vista (81%) Martin Garlant Southern AZ

Company Evaluation Utility Rates 91 19. For each of the following utility services, please indicate if you feel the rates charged are much too high, somewhat too high, just right, somewhat low, or very low. When comparing the perception of pricing for different utilities and services that respondents received, those considered somewhat/much too high were television (69%), electricity (66%) and landline phone (57%). Water and waste water/sewer actually had the lowest too high scores (40% and 50% respectively). However, both received scores that were 3% to 4% higher as compared to 2010 data. Top 2 Box Scores (4,5): 5 = Much too High NOTE: Orange circled data indicates significant change/ difference compared to other year(s). Martin Garlant Southern AZ

Company Evaluation Overall Satisfaction 92 20. Overall, how satisfied are you with [INSERT FACILITY BASED ON ZIP CODE]? Respondents were satisfied with their water/waste water provider overall, with 88% of respondents stating they were somewhat/very satisfied (up 1% from 2010). Those with significantly higher very satisfied scores were from Belle Vista (69% vs. 52% overall), 18-44 year olds (66%) and residents less than 5 years (64%). Overall Satisfaction Significantly Higher Very satisfied: Belle Vista (69%); Ages 18-44 (66%); Residents less than 5 years (64%) Martin Garlant Southern AZ

Company Evaluation Overall Satisfaction 93 20a. Being as specific as possible, why did you say you are [INSERT FROM Q20] with [INSERT FACILITY BASED ON ZIP CODE]? Those somewhat/very satisfied with the provider were so because they never had a problem/complaint (32%). However, 14% of those satisfied still felt the cost is too high/rate increases. Not surprisingly, cost is too high/rate increases (59%) was the main reason why respondents were dissatisfied (not satisfied at all/somewhat dissatisfied). Of even more importance is the fact cost as a factor rose by 19% as compared to 2010 data. Poor/unfriendly/uncaring service was also an important reason for dissatisfaction (24%; up 11% from 2010). NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. *Caution: small sample size. Suggestions for Improvements 2009 (n=250) 2010 (n=252) 2011 (n=250) Difference from 2010 Why SatisfiedN=217N=221N=222 Reliable/No service interruptions17%10%9%-1% Never had a problem/complaint18%34%32%-2% Cost is reasonable14%5%6%+1% Good/friendly/courteous customer service14%9% 0% Service is satisfactory/good/excellent11%13%8%-5% Water quality is good11%4% 0% Cost is too high/rate increases10%14% 0% Why Not SatisfiedN=13*N=15*N=17* Cost is too high/rate increases 23%40%59%+19% Poor/unfriendly/uncaring customer service 15%13%24%+11% Water is cloudy/contaminated/poor quality/hard 15%7%12%+5% Low/Fluctuating water pressure 8%7%6%-1% Smell/taste of water 8%7%0%-7% Martin Garlant Southern AZ

Rate Hikes 94 Likelihood of Attending Informational Meeting 21a. If rate case informational meetings were held in your community how likely would it be that you would attend? 21c. Regarding rate increases, given the opportunity would you prefer: In terms of customer involvement in potential rate hikes, half (50%) stated they were very or somewhat likely to attend an informational meeting. In case of rate increases, the vast majority (91%) preferred having the increases spread out over time with small increases occurring every year. Rate Hike Preference Martin Garlant Southern AZ

EASTERN ARIZONA (BLACK MOUNTAIN, GOLD CANYON, ENTRADA DEL ORO) Business Manager: Charlie Hernandez 95

Awareness & Perception 96 A1. What is the name of the company that provides water and/or waste water service to your household/business? A2. How would you describe your water and/or waste water service company and the services it provides? Name of Water/Waste Water Provider NOTE: Data in orange shaded cells are significantly higher; data in gray shaded cells are significantly lower: at 95% confidence level. Significantly Higher Liberty Water/Algonquin: Residents less than 5 years (64%) Suggestions for Improvements 200

liberty water customer satisfaction – final report september, 2011

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