Mayor and Aldermen Call Special Meeting to Set DUD Rate

December 3, 2013
by: 
Dwayne Page
Mayor and Aldermen

The DeKalb Utility District's current water purchase contract with the City of Smithville is due to expire December 31 and no new agreement has been reached between the parties.

During Monday night's regular meeting, the Mayor and Aldermen set a special meeting for Thursday, December 12 at 5:00 p.m. at city hall to set a new rate for the DeKalb Utility District if the two sides cannot agree on a new deal before the deadline.

The City has offered two alternatives for the DeKalb Utility District to consider on a possible new water purchase agreement. The DUD has not yet responded.

"We've given them (DUD) every opportunity to come before us or meet with us and work with us to thrash it out and they're not wanting to do it. I think we ought to have a special called meeting and set the rate and be done with it," said Alderman Danny Washer Monday night.

As WJLE first reported on November 19, City Attorney Vester Parsley, Jr. sent a letter to DUD manager Jon Foutch, dated Thursday November 14, setting out the proposals being offered by the city for the DUD board to consider.

One of proposals calls for a new ten year deal with the city to charge the DUD $2.20 per thousand gallons for five years and $2.40 per thousand gallons for an additional five years. While these rates are below the city's current cost of producing water, according to a recent study done by Warren and Associates, the city is willing to make this deal provided that the DUD abandon plans to build its own water plant and buy a certain amount of water over the next ten years from the city.

The city offered the same deal to DUD in April. City officials said DUD was willing to accept the rates but did not want to be held to the minimum purchase part of the offer.

In its second proposal, the city seeks to negotiate a new rate based on the sale of three DUD metering points to the City of Smithville.

During a workshop with the mayor and aldermen on Monday night, November 11, the city's utility engineer J.R. Wauford said that if the DUD were willing to sell the city the water lines and customers connected to at least three of its metering points, the city could be in a position to negotiate the price it charges the DeKalb Utility District.

If the DUD rejects either of the proposals and there is no new agreement by January 1, the city may begin charging the DUD $7.50 per thousand gallons, the same rate it charges water customers outside the city.

Some DUD customers are concerned that the city may shut off the water supply to DUD if no agreement is reached by December 31.

Mayor Jimmy Poss said the city cannot legally turn the water off, nor does it wish to. "I have had some concerned people who are afraid we're going to cut their water off. We're not going to do that. We can't do that but I am concerned about people thinking that," said Mayor Poss.

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