The City of Smithville is joining Cookeville in trying to avoid or reduce payment of fees to the U.S. Army Corps of Engineers associated with the cost of repairs being made at Center Hill Dam.
Under federal law, utilities permitted by the Corps to draw water from lakes, including Center Hill are required to share in the costs for making repairs. The City of Smithville, the City of Cookeville, and the DeKalb Utility District are permitted to draw water from the lake. Smithville’s allocation is approximately two million gallons a day.
In March, the City of Smithville received a letter from a Corps official and a bill for $89,818. According to the letter, from James R. Waddle, Chief Engineering-Construction Division, “The U.S. Army Corps of Engineers Nashville District is continuing with the major rehabilitation work at Center Hill Dam and this work consists of two phases, main dam rehabilitation and the saddle dam rehabilitation. The main dam work is complete, placed in service, and the City of Smithville is being billed for that work as per the terms of your water storage agreement. In addition, a table of our best estimate of what your future billing will look like through 2020 is included for the remaining work”.
During Monday night’s meeting of the Mayor and Aldermen, City Administrator Hunter Hendrixson said the City of Cookeville, which has also been billed a certain amount by the Corps, is challenging the fees. The issue is whether the dam repairs are considered a “safety” or “rehabilitation” project. The distinction would make a difference in costs to the utilities.
Cookeville Mayor Ricky Shelton recently sent letters to Congressman Diane Black and to U.S. Senators Lamar Alexander and Bob Corker asking them to intervene in persuading the Corps to delay its initial demands for full reimbursement costs for the dam repairs until a final determination is made.
In a letter to the Assistant Secretary of the Army (Civil Works) in Washington, D.C. on March 16, the Congressman and Senators wrote that “on behalf of communities in Tennessee that are being required by the Corps of Engineers to pay additional costs for safety repairs at Center Hill Dam, we urge you to delay cost recoupment from these communities until the Corps implements the Government Accountability Office’s (GAO) recommendations to improve cost-sharing for dam safety repairs”.
“The problem is that the Corps has unilaterally decided that safety repairs to Center Hill Dam are not covered by the Dam Safety Act. Instead of classifying repairs at Center Hill Dam as Dam Safety Assurance, the Corps has decided to classify the repairs as Major Rehabilitation. This decision significantly impacts the cost share borne by communities in Tennessee.”
“In December, 2015, the GAO issued a report that found the Corps has not applied the so-called “state of art provision” of its Dam Safety Assurance authority. The GAO also found that the Corps did not communicate or effectively engage with all project sponsors at the nine dam projects it studied, including Center Hill Dam.”
“In your letter to the GAO on November 12, 2015, you agreed with the GAO’s recommendation to clarify policy guidance on the use of the “state of the art provision” within 18 months. You also committed to engaging with the Center Hill Dam projects sponsors to establish a path forward for recouping Federal investment within 18 months.”
“We appreciate your commitment to resolving this issue, but instead of engaging with project sponsors to establish a path forward, we understand that the Corps is currently seeking full reimbursement under the Major Rehabilitation and asking communities to pay by March 31. We urge you to delay recoupment until the Corps clarifies its policy regarding the “state of art provision” and also more effectively engages with the project sponsors. It would also be helpful to know when the Corps plans to clarify its policy regarding the “state of the art provision” and whether any additional legislative changes are necessary,” the letter concluded.
According to City Administrator Hendrixson, Smithville will be getting more bills from the Corps over the next few years. “The US Army Corps of Engineers sent us a letter in March and the City of Smithville’s portion now is $89, 817. 97 based on what we draw out of Center Hill Lake. Our allocation charge for the 2016-17 budget year will be $3,000. For the year 2017-18 budget it will be $130 and for the year 2018-19 our costs will be $270. In the 2019-20 year, our final estimated cost will be $40,000,” said Hendrixson.
The fees assessed by the Corps to the DeKalb Utility District and the City of Cookeville were unavailable.
In addition to the costs for dam repairs, utilities must also pay a regular schedule of “water storage” fees to the Corps based on their permitted allocation agreements.
The Smithville Aldermen Monday night voted to follow Cookeville’s lead in challenging the fees assessed for dam repairs.