Tennessee American, Walden Ridge Utility District Vying To Take Over Signal Mountain's Water System

  • Saturday, September 26, 2015
  • Gail Perry

The water system in Signal Mountain is a public utility, currently owned by the city. At an agenda meeting Friday afternoon, the town council heard proposals from two parties for taking over the system.

There are three ways for changes to be made: to allow a company to only supply the water, for a company to supply the water and maintain the system, or to allow a company to outright purchase the system.

 

Representatives from Tennessee American Water Company and from Walden’s Ridge Utility District both made presentations of what they could offer the town. The only thing they were asked not to talk about was the price they are willing to offer. City Manager Boyd Veal said this would keep the playing field even.

 

Kevin Rogers, director of operations at Tennessee American Water, said his company has provided water to Signal Mountain for many years and would like to expand the relationship. It was described as a local company with a national parent that is American Water which serves 16 states. This large base, results in big buying power and lower costs, he said. If the town sells the water system, he said it would benefit by receiving upfront funds and the property tax base would expand.

 

 He said water quality is the focus of his company which is higher than the minimum required by EPA standards. Tennessee American puts 30 percent of received revenues back into the infrastructure each year for maintenance or improvements. One of the most important improvements is to make sure water flow is sufficient for all fire hydrants in the city. Meters that are manually read would eventually be replaced with ones that could be read remotely. Customers are also offered direct draft capability. The company participates in research and development that promotes a strong environmental bias, said Mr. Rogers.  Current city employees of the water department would be retained and, he said, the pay scale and benefits would exceed what they are currently receiving.  

 

Tennessee American’s pricing is regulated by the Tennessee Regulatory Commission that sets the rates after a review process. The average monthly bill, he said, is $23. Surcharges are added to the bill according to the maintenance costs or for infrastructure improvements.  The surcharges are also reviewed by the regulatory commission, which determines the amount.  

 

Don West from the Walden Ridge Utility District represented the second business that is interested in Signal Mountain’s water system. This business was described as a community utility that is overseen by four board members. It has been on Signal Mountain since 1950 and currently provides water to 800 customers in the town of Signal Mountain. This utility buys water from Hixson Utility District and resells it. The amount available is sufficient to supply the town, said Mr. West.

 

The goal of this company is to rebuild the system and to reduce water loss. As the system is constructed, priority is given to use pipes that are of sufficient size to supply fire hydrants. This company does its own construction, which keeps costs down, he said. The utility now uses meters that are read remotely but it is looking at the new technology of cellular meters. Phone calls are answered by a real person and response times are 15-20 minutes because the employees are already on the mountain. Capital improvements to the system would be funded by the rates.

 

Mr. West told the council that rates are comparable to Tennessee American, but are not regulated. There is a minimum monthly rate for each customer of $20.15 and a rate per 1,000 gallons after the base. A $150 deposit is required from all renters. He said that the utility would do its best to keep everybody that is currently employed with the town’s water department.

 

Councilman Chris Howley asked for bids to be submitted two ways from both companies - either to purchase the system from Signal Mountain or to supply water and service the system. The companies are expected to be ready to put together a bid package in around 90 days. They will be presented at a public meeting, which will also be used to discuss zoning issues.

 

Discussion took place about opposing Hamilton County Mayor Jim Coppinger’s proposal to share in state sales tax. It is felt that the best way will be to enter into an inter-local agreement with the other municipalities that are in the county. Doing it as a group, it is felt, may have more impact. The right person to lobby the state legislature is yet to be determined.

 

If council members can participate in a meeting electronically has been researched by the city manager and city attorney. Mr. Veal told the council that it has been determined that electronic participation is not available to this body.

 

The type of business that should be conducted at an agenda/work session was discussed. Agenda meetings are not well attended, possibly because of the time of day that they are held, said Mayor Dick Gee. These meetings are intended to set the agenda for the following regular council meeting, but they have also been used to make decisions and spend money, he said. The question he posed was if more discretion should be used in the type of work done at these meetings.

 

The general opinion was that for efficiency, budgeted expenses should be allowed, but that other ordinances should be voted on at regular council meetings. Mayor Gee suggested using the agenda meetings for the first readings of an ordinance but only for discussion. The second and final vote would take place at the more formal council meetings which are better attended. Councilman Bill Lusk suggested the possibility of changing the agenda meetings to evenings where there is more citizen participation and where ordinances could be voted on.

 

People in the audience at council meetings have difficulty hearing the commissioners. Mr. Veal has found that the problem is largely due to using the wrong type of microphones. He said they can be replaced for $2,400. If sound quality is improved enough, there are plans to post the audio of the meetings on the city’s website.

 

The mayor read a proclamation establishing the week of Oct. 4-10 as Fire Prevention Week throughout the city. He said that the fire department has smoke alarms available for residents. The department will also install the devices.

 

The dates for two upcoming meetings may be rescheduled. The next agenda work session is planned for Oct. 23, but Mr. Veal said three council members will be out of town that day. And, the agenda meeting in November falls on the Friday after Thanksgiving. The council agreed to look into changing the days for both of the meetings.

 

 

 

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