Opponents of a proposed DeKalb Utility District water plant crowded into a small meeting room and hallway Thursday afternoon for a special DUD board meeting at the utility's office building.
(CLICK PLAY BUTTON BELOW TO HEAR DUD BOARD MEETING THURSDAY)
Many of them spoke out against the board's decision to build the plant, saying it is not needed and that it will cause rate increases for subscribers. The DUD currently purchases its water supply from the City of Smithville. Board chairman Roger Turney took comments and questions from the audience for about an hour and forty five minutes, before the board took action on a bond resolution for the project.
Four of the five board members voted in favor of the resolution, including Chairman Turney, Joe Foutch, Danny Bass, and Jimmy Womack. Board member Hugh Washer voted against the resolution.
The board also voted to amend its debt management policy.
The legal notice for the meeting said that the bond resolution is for the authorization and issuance of not to exceed $9-million 250-thousand dollars in aggregate principal amount of waterworks revenue refunding and improvement bonds
During the meeting, Turney explained what that means. "In essence what it does is, it gives the bond council the right to go into negotiations to set up and to see just what qualifications we'll have. What our bond rating will be and what the bonds will cost. No obligation will go forward. If something happens, we can back out of that and change it, but this gives them the permission to go on and find out exactly to the penny what our bonds will cost, what the interest rate will be, what the interest rate will be for those who buy them, and what the final cost will be," said Turney.
After the board's vote, several residents, already passoniate in their opposition, left the meeting even more upset.
The following are some of the comments made during the meeting by opponents of the water plant.
John Daniels, a City of Smithville water customer, first asked why the DUD board held its meeting at 3:00 p.m., an inconvenient time for most people, and in such a small room unsuitable for a large crowd. Turney later explained that the meetings are typically held at this time and location and he blamed a media campaign authorized by the City of Smithville for spreading misinformation about the DUD's plans." This is not a new idea. We have been discussing the possibility of a water treatment plant for ten years. I'll be honest with you. Most of the group here today is because of a vast majority of misinformation that was handed out at the behest of the City of Smithville. A lot of the information has been drastically misunderstood and misrepresented. Obviously, there's been a lot of money spent sending out calls, newspaper ads, and letters to all the customers, which is fine. But a lot of the information was not correct," said Turney.
Daniels also questioned the need for a second water plant in DeKalb County. "How many times has the water ever been down in Smithville," he asked? " I've lived here for 34 years. I've never seen us without water, ever. Most other places don't have redundancy (more than one water plant) either. It seems foolish to me to have two systems with one of them only running at 45% (capacity)," said Daniels.
Turney said "Our major concern is DUD customers. We buy our water from Smithville. Every year that water rate goes up because the rate from Smithville goes up every year. Our contract (with Smithville) runs out in eighteen months. We looked to the future. We had our auditors and several different other people look at the possibility of continuing to buy water from Smithville or produce our own water. In the long run all the projections come back that our water rates will go down or not go up as much because we will have the capacity to control our own expense and not have to depend on Smithville," said Turney.
Dwayne Cantrell of New Hope Road, a DUD customer, challenged the board to fix water pressure problems in the existing system, before taking on a new project. Cantrell said he and many of his neighbors have had to install water pumps under their homes due to the lack of pressure in DUD lines which are too small. "I shouldn't have to have a $400 water pump under my house in order to take a shower," he said.
DUD Manager Jon Foutch said the utility is applying for a CDBG grant through the county commission to the Tennessee Department of Economic and Community Development, which if approved, would address water pressure problems in some areas. "If we were to get the grant, it would be for that area around Dismal to build a water tank. Being that much higher, we have customers like you in mind and also at Jenkins Hill where they have low pressure and that would take care of that problem," said Foutch.
Robert Kirkham, a resident of Anderson Ridge Road at Silver Point, said the DUD should try to get a water line run via Hurricane Bridge so customers in his community could get water cheaper. "Cookeville sells to Baxter, Baxter sells to DUD, and DUD sells to us. By that time, its pretty expensive, he said. "Why not take this opportunity to put water across the bridge as they (TDOT) are refurbishing Hurricane bridge and relieve us of triple taxation for water we get. We also have almost no fire hydrants anywhere in our area," he added.
In response, Turney said "We are concerned about the water bills of customers at Silver Point. We have looked at every possible way to handle that. The problem is it was over $500,000 to put that pipe (casing) on that bridge (Hurricane bridge). No water line, just the pipe. We have no water line to it (bridge) and no water line on the other side of it. If we had gone through the whole process of hooking that up, putting the pipe across the bridge and putting in the water line, the whole bit, probably everybody's bill, the whole district would have had to have been doubled just so that you all (at Silver Point) could have a cheaper rate. That's unfortunate that your rate is higher but we can't get grants for this because it doesn't serve new customers, its existing customers. You can't get grants for existing customers. You get grants for new customers. My hope is that eventually, if we can get to the point where we can control more of our own money, we may be able to do something like that (connect DUD lines directly to Silver Point) but right now we can't. If Baxter had not been willing to let you (Silver Point customers) have water, you probably wouldn't have any water at all today. Is it better to have a high water bill with water, or no water bill and no water," asked Turney?
Tommy Curtis of Hurricane Ridge Road, called for a referendum of DUD customers to gauge support for a new water plant. "Why can't we have a referendum to let the voters on the water system now cast a vote as to whether we want this done and let some independent group count the ballots. You're not giving us any choice and we're the ones who are going to have to pay the bill," he said.
Fifth District County Commissioner Jerry Adcock, a DUD customer, said he would like to see a change in the law to require DUD board members to be elected by those they serve. Currently, board members are appointed by their county commissions, according to Adcock. Names of likely appointees are apparently submitted by the DUD itself to the county commissions for consideration.
Charlie Rush of LaFevre Ridge Road suggested that DUD keep buying its water supply from Smithville." You have a perfectly good water plant on the other side of town, operating at 50% capacity. What in God's name do we need to be wasting money to build another one and bankrupting the first one," he said.
Randy Rhody of Cookeville Highway, said DUD customers should have been made aware of this project from the start and given the opportunity for input early on. "A lot of the problem is poor communication," he said. We've had no public forum. We've not been involved in any of the decision making on it. A lot of this is causing a lot of bad will between the city and the county. That's unfortunate. We need to all get along and work together. We've had no problem in getting water. To me, if you vote yes, then you're thrusting higher costs on all the residents of the DUD and you'll be remembered for this mismanagement. I think it's a mistake and I think most people think it's a mistake. We've not been involved in the process. Had we all been sold on this, we would be behind you. That hasn't happened. It seems the decision has been made in a closet and people haven't been informed and don't know. All the things I've heard so far sounds like this is not needed," said Rhody.
Robbie Taylor of New Home Road said the DUD should consider people on fixed incomes who can't afford higher water bills. " DeKalb County doesn't have a lot of rich people," she said. " A lot of people are on fixed incomes. We've got a lot of elderly people and our income don't go up much. I've always heard if anything is not broke, don't fix it. I don't see anything is broke. I think we should leave it like it is," she added.
Some suggested that the DUD's desire in building this water plant is to expand its service area into Rutherford County. Turney denied that notion saying that the DUD simply wants control of its own destiny. "There's been talk of selling water to Rutherford County. That's my fault. I mentioned at our last meeting of possibilities of places that could use water. I mentioned Rutherford County. We haven't talked to Rutherford County and they haven't talked to us. Again, that's being blown out of proportion to try to get people stirred up. We have no intent of selling to Rutherford County. Now, if someday they would like to tie into us, that would be a cash cow. That would give us income that would lower everybody's bill. But we're not even looking to do that. What we're trying to do is make the rates for DUD customers as reasonable as possible, to provide water and keep it down as best we can," said Turney.
Turney also argued that DUD water rates, while increasing seven percent each year over the next three years, will actually stabilize, if not decrease in time with this new plant. "We had to project to the state what our rate increases would be in order to pay for this grant, loan, and this water treatment plant. Our board passed a seven percent rate increase for this year, seven percent next year, and seven percent the third year with the stipulation that the third year that seven percent increase may not be that much. Let's talk about what that really means. Our minimum bill right now is $17.50. At the end of that three years, the minium bill will go up four dollars and twenty cents. That's the price of 1.2 gallons of gas today. That's not going to break anybody. I don't want anybody's water rate to go up but that's a small price to pay. We figure that our average customer uses about 6,000 gallons. Their water bill now is around $44.00. At the end of the three year period, their water bill will go up $10.50," he said.
Turney also believes that having two water plants in the county would be better than one, especially in the event of some catastrophic episode. "What if something happens, and it did happen sometime ago. A flood came and Smithville was short of water for a while. Thank goodness it wasn't a disaster. It could have been. What happens if that plant goes down. Where do you get your water? There's no other place. With two treatment plants, we can benefit Smithville and they can benefit us and I firmly believe that in the long run not only will DUD customers be happy that we did this, but the City of Smithville will be happy we did it. We can help each other," said Turney.
The DeKalb Utility District serves parts of a four county area, DeKalb, Cannon, Smith, and Wilson.
USDA Rural Development funds will be used to construct a new Raw Water Intake, Raw Water Transmission Line, Water Treatment Plant and distribution system improvements. The proposed plant will be constructed near Holmes Creek Road and will have a capacity of three million gallons per day. The intake will be on Center Hill Lake, the Transmission Line along Holmes Creek Road and distribution lines will be along Allen's Chapel, Game Ridge, Turner, South Tittsworth, and Big Rock Roads, and Wheeler Lane.
The DUD will receive a $5,000,000 loan and a grant of $1,250,000 to fund construction of the water plant. The terms of the loan are forty years at 2.75% interest. The remaining $4,250,000 needed to build the $10.5 million facility will be funded through a bond issue. Turney said that the DUD is also refinancing other loans to save money. "In this loan and grant we have applied for, we're refinancing some of the loans we already have at a savings of over $400,000 on the money that we have right now because of the historically low interest rates. The time is right. Everything that we've looked at says this is the time to do it," he said.
As Turney mentioned, this is not the first time the DUD has seriously considered building its own water treatment plant. In January, 1999 the DUD was awarded a $1 million Rural Development Grant and a $2,380,000 loan. In addition to the money for the water plant, another $500,000 was made available to the project from a Community Development Block Grant for an elevated water storage tank which now stands at the top of Snow Hill. The tank was built to solve the problem of water pressure in some areas.
However when it came time to build the water plant, the DUD apparently discovered that the costs were much more than the available grant/loan funds. While DUD had sufficient local reserves to make up the difference and assurances from Rural Development for extra financial help if needed, the DUD decided instead to enter into negotiations with the City of Smithville for a new water rate. Some of the loan/grant funds were later used to make other improvements to the existing infrastructure.