DeKalb Utility District's ten year water contract with the City of Smithville is set to expire within two months and no new agreement has yet been reached.
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The parties have apparently not even been in any serious discussions on a new contract for several months.
Plans for a new DUD water treatment plant are still in the making but have apparently been put on hold because of a legal challenge in Davidson County Chancery Court by the City of Smithville and DUD ratepayers. But even if the legal hurdles are cleared and the DUD proceeds with its plan to build a water plant, it will apparently need a new water contract with the City of Smithville until the facility is completed.
The City of Smithville currently sells water to the DeKalb Utility District for $2.05 per thousand gallons. Under terms of the contract, the rate has increased by five cents per thousand in each of the last ten years beginning in January of each year. The two parties entered into the contract in 2004 and it expires December 31, 2013.
During Monday night's city council meeting, Alderman Tim Stribling called for a workshop to discuss new rates for the DUD. The workshop will be Monday, November 11 at 5:00 p.m. at city hall. DUD board members and officials are invited to attend. "Mr. Mayor, the DUD contract as we all know expires December 31. I would like for this board to maybe set up a workshop where we can discuss some things concerning the contract. We all know there is going to be a new rate so I would like to set up a board workshop," said Stribling.
"We'll just have some numbers together and look at some facts and figures. Of course we can't come to a conclusion or vote on it (because it's a workshop) but we can at least get the ball rolling," said City Recorder Hunter Hendrixson.
"Would you like me to send an invitation to DUD to be present," asked Hendrixson?. "Or course, it's an open meeting. If they want to be here they can be here," he added.
The aldermen agreed that since the workshop is open to all, DUD officials are welcome to attend and no formal invitation was necessary.
A recent study by Warren and Associates, paid for by the city, revealed that the actual cost for Smithville to produce water is $2.67 per thousand gallons. In April city officials discussed offering DUD a new ten year deal which would include selling them water at $2.20 per thousand gallons for the first five years of the contract and raising it to $2.40 per thousand gallons for the last five years. No official vote was taken but city officials sent the offer in writing to DUD officials a couple of days prior to the Tennessee Utility Management Review Board hearing which was held in Smithville to review DUD's water rates. DUD officials later responded agreeing to accept the offer but without the minimum volume purchase requirement the city wanted as part of the proposal.
The City of Smithville's legal fight to keep the DeKalb Utility District from building its own water treatment plant remains pending in Davidson County Chancery Court.
City Attorney Vester Parsley, Jr. informed the mayor and aldermen Monday night that the transcript from April's Tennessee Utility Management Review Board (UMRB) hearing has been filed and that a brief for the city is forthcoming. "I talked to Jason Holleman today. His firm as you know is representing the city with the appeal. The transcript of the hearing that was held here in April has been filed with the Chancery Court in Nashville. It was filed on October 28. Jason and Bill Purcell have until November 27 to file our brief for the city. Thereafter, DUD will have up to 30 days to file their brief which will basically put it at December 27. Of course, they can file that brief early. If they do then Jason and Bill will have an additional fourteen days to reply to that. It looks like the earliest that we probably will have any real hearing before the Chancellor in Nashville will be somewhere in January. Probably toward the middle (January) but those dates are not certain because the time for filing briefs has just gotten started. That's where we're at right now," said Parsley.
In July, the aldermen voted 4-0 to hire Nashville attorneys Bill Purcell and Jason Holleman to file an appeal of the UMRB's dismissal of a petition brought by a group of DUD ratepayers and the city who were hoping to halt DUD plans to build the water plant.
Following a hearing held April 4th in Smithville with an administrative law judge presiding, UMRB members voted to dismiss the petition saying they (petitioners) had failed to meet their burden of proof that DUD rates or services provided were unreasonable. The UMRB entered its final order on June 5.
Calling the UMRB's ruling "arbitrary and capricious", attorneys for DUD ratepayers and the City of Smithville filed an appeal in August asking the Davidson County Chancery Court for a judicial review of the case.
The attorneys for the city and DUD ratepayers allege that "the UMRB acted in violation of statutory provisions and followed an unlawful procedure by failing to apply the appropriate scope of review in its deliberations and otherwise acted illegally, arbitrarily, and capriciously in the case. Further, the UMRB’s decision was unsupported by substantial and material evidence in light of the entire record."
The court is being asked to reverse the decision of the UMRB and decree that its action was illegal, arbitrary, and/or capricious and that any such further general relief be granted as the equities of this case may require and as the Court deems necessary and appropriate."
During Monday night's city council meeting, Darden Copeland of Calvert Street Group said it appears that because of the city's appeal, the DUD has not yet moved forward with it plans to build the water plant. He added that public opposition to the proposed facility remains strong. "We still continue to monitor whether or not the bonding authority has put the bonds out for bid. As of right now, everything is completely on hold pending the outcome of the (court) hearing. We continue to monitor DUD meetings. We are also in touch with some of our key members of the DUD committee that were anti the bonds. We still continue to collect petition signatures here and there that still trickle in both on line and through paper. We still have a great database of folks who are as still fired up today as they were a year ago despite the delays," said Copeland. Calvert Street Group is a Nashville public relations company, hired by the City of Smithville to lead opposition efforts to the proposed DUD water treatment plant.
Parsley said it's not yet known when there will be a ruling on the city's appeal. "There is no date set for the hearing. The Chancellor could give a ruling from the bench. Most likely the Chancellor will study it and give us a written opinion after the hearing. It most likely will not be, although it can be on the day they have a hearing. The Chancellor has that discretion in deciding whether she will rule from the bench or whether she will give a written opinion later. It's impossible to tell right now," said Parsley.