Mayor and Aldermen Schedule Workshop on New DUD Water Rate

November 5, 2013
by: 
Dwayne Page
Mayor and Aldermen

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.

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.

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