CITY COUNCIL Discusses MERGER OF UTILITIES

The Columbia City Council learned more details about a possible merger of the city's water and sewer utilities with the Adair County Water District Monday night as an attorney specializing in such matters appeared before the council to go over the steps that would be involved in the merger and answer questions about it.
Attorney Damon Talley of Hodgenville briefly explained how the 25-step process, which had been presented to the council at its December meeting, would progress.
Talley said that combining the utilities of the city, Adair County Water District and the Columbia/Adair County Water Commission into the Columbia-Adair County Utilities District would be a two-part process.
"The best way to combine them is one step at a time," he explained. "The first step would be to combine the retail side of the city and county utilities, then fold in the Columbia-Adair County Water Commission."
Some of the major steps involved in the merger would require the city to transfer assets of the utility system to the water district, and the water district would have to assume or pay liabilities owned by the city's utilities. A determination of what city employees would be transferred to the county would have to be made, and the Adair County Fiscal Court would have to approve the annexation of the city into the county water district's boundaries.
Councilman Edwin Taylor expressed concern about how the city would be represented on the county water district board. Taylor said he wanted assurance that there would be city residents on the board.
Talley said that county water district has five board members, the maximum allowed under state law, so it could not be expanded to include new members from the city.
He explained that it is up to the county judge/executive to recommend appointments to the county water district board, and the appointments must be approved by the Adair Fiscal Court.
"While it can be worded in the agreement that the county water district strongly recommend one or two city residents be appointed to the board, it can't be a guaranteed thing," he said. "One would think the judge and fiscal court would want a representative from the city on the board, but the final decision (on appointments) is up to the court."
Councilwoman June Parson said she would like some more information on the status of the city's utilities, and asked for detailed, up-to-date operating statements, detailed lists of assets and detailed lists of liabilities for the city's water, sewer and gas operations.
Parson also asked if a feasibility study would be done.
Talley said that there is no legal requirement that a feasibility study be done, and that when most mergers of utility systems take place, "sometimes one is done, but most of the time there isn't."
"The city can have a feasibility study done at its expense, but usually when things have reached this point, all parties already know the benefits of the merger, so it would be an unnecessary expense," he stated.
Talley went on to note that, "I'm not here to convince you that the merger is a good deal. My job is to make sure it is done in the proper and legal way if you decide to do it. You've got to have something sustainable.
"I will say that it will be hard for the city to break even on the utilities with the new federal regulations coming down and the aging pipes in the city," he stated.
Councilwoman Linda Waggener asked if the merger took place, would it guarantee that current problems the city is experiencing with water quality be solved.
Lenny Stone, manager of the Adair County Water District, addressed Waggener's question, and said they could not guarantee the problems would be fixed immediately.
"The problems didn't happen overnight, and they can't be fixed overnight," he said. "We don't even know what all the problems are until we can get into it. Once we get into it, we will look at what all has to be done. The first two problems we would try to address would be water quality and water loss."
Stone went on to say that feeder lines off the new main water line being run around the bypass could be hooked up to various sections of the city to improve water quality. He also noted that the county water system has assets that could speed up the improvements to the city's lines.
Councilman Taylor asked how the rates city residents pay for water would be affected by the merger, and Talley said they would not be affected too much.
"The disparity between the city and county rates here is not that much," Talley explained. "In most places, county rates are a lot higher than city rates."
Talley passed out a rate comparison sheet, which showed that rates charged by the county per 1,000 gallons of water are slightly higher. For example, a city customer using 3,000 gallons of water a month would pay $1.10 more under county rates, while someone using 6,000 gallons per month would pay $5.60 more.
"At some point in time, the PSC (Public Service Commission) will require a unified rate so that everyone in the city and county will pay the same," he said.
Councilwoman Parson also noted that the city currently has the Ken Virons engineering firm working on a downtown rehabilitation project to see what lines need to be replaced, and asked how this would be affected by the merger. Talley said that project could probably be assumed by the county system if the merger goes forward.
Mayor Pat Bell compared the merger of the utility systems to the merger of the city and county school systems years ago, and said that he feels the merger will be the best for everyone.
"Everyone was probably a little uneasy when we first approached this," Bell told the council. "When the city school system went to the county system, there was a lot of anxiety then too, but things have worked out pretty good.
"We're not making any money now, and I think it would be best if we merge," he continued. "We can look back on it, and say we're glad we did it."
"It's a big step, and one you don't want to enter into lightly," Tally told the council. "But, you do have problems with water quality and water loss and aging lines."
Resolution to apply for funds to expand sewer lines near Pinewood dies
Mayor Bell had City Attorney Marshall Loy read a resolution that would authorize the mayor to apply for grant money from Rural Development and the ARC to expand sewer service to the Pineview Drive area next to the country club, but the matter died as the council failed to bring it to a vote.
The mayor said that the total project would cost around $1.8 million and serve around 80 new customers. Bell noted that the project is necessary if they want to keep Columbia growing.
However, Councilwoman Parson questioned whether applying for the grant would affect the city's seeking grant money to fix the aging water lines.
"I don't want to interfere with the water project," she said. "Will it have a negative effect on that project?"
Mayor Bell responded that he didn't think it would be a problem, as "that is water and this is sewer," but did say that some of the money may be coming from the same pot.
"I'm not against the project, but we need to address our current problems first," Parson replied.
The mayor asked for a vote on the resolution, but after a brief wait, no council member made a motion to bring it to a vote.
In other action at the meeting, the council:
•Gave second and final reading to ordinances closing a section of Madison Alley from Burkesville Street to South Monroe Street and a section of Adams Alley from Campbellsville Street to North Reed Street.
•Gave second and final reading to an ordinance clarifying the correct zoning of a piece of property on Highway 55 South owned by Ronnie Janes that has been annexed into the city.
•Approved Mayor Bell's recommendation that Lynn McLean be re-appointed to another four-year term on the Housing Authority of Columbia board.
All council members were present for the meeting.