Group threatens petition drive

By David Showers
This article was published November 14, 2017 at 4:00 a.m.

Part of the coalition that organized successful petition drives earlier this year against ordinances annexing lake-adjacent lands is resolved to do the same for the water rate increase the Hot Springs Board of Directors plans on considering at its Nov. 21 business meeting.

A petition referring the ordinance to city voters was the consensus that emerged from last week's gathering at the Garland County Library, said Bob Driggers of the Garland County Good Government Group. The activist association held a public forum on the proposed ordinance, which would increase the minimum monthly charge by $3 next year to raise revenue for debt service payments on $110 million of capital improvements to the city's water system.

The minimum charge would increase to $13 by 2021 under the ordinance's rate schedule, a 160-percent bump from the $4.99 customers inside the city currently pay for the first 1,000 gallons of usage. The enabling ordinance was removed from the agendas of the board's Oct. 17 and Nov. 7 meetings.

The Good Government Group was part of the coalition that collected more than 6,000 signatures in support of referendum petitions on ordinances annexing areas situated between the corporate limits and Lake Hamilton, prompting the board to repeal the ordinances in March instead of scheduling a special election.

Per city ordinance, there's a 30-day deadline after the passage of any ordinance or resolution for filing a referendum petition. The signatures of 1,440 registered city voters are needed for the board to refer an ordinance to voters.

The panel at last week's meeting questioned the rationale for issuing $95 million in debt to bring the city's 23 million gallon-average day allocation from Lake Ouachita online. Questions were also raised about the prudence of paying $444,440 a year to the U.S. Army Corps of Engineers to store the water behind Blakely Mountain Dam.

The city began making payments in May, amortizing its share of $12.4 million in storage costs despite being unable to access the water until the intake, raw-water line, treatment plant and distribution system that will be financed by the indebtedness are in place.

The panel included Bill Malone, of local engineering firm Malone & Associates; Bud West, a member of the Community Water Committee, a bilateral city-county group that formed in 2014 at the request of The Greater Hot Springs Chamber of Commerce and Fifty for the Future; and former Justice of the Peace Ellen Varhalla, a retired engineer.

They said the current water supply is adequate to meet demand and could be leveraged to serve future needs if the city increased its finished water storage capacity and reduced the percentage of line loss, stressing that the city needs to shore up the distribution system before it brings another source online.

Panelists pointed to the inefficiency of a system, that, according to information from the city's rate consultant and the Arkansas Department of Health, required 15 million gallons of production to meet last year's average-day demand of 7.9 million gallons.

The Health Department's survey showed 27.72 percent of water production was lost last year to leaks in a sprawling distribution system serving more than 35,000 meters, of which about half are outside the corporate limits. The 2010 survey indicated line loss accounted for 42.7 percent of production.

The city has said leaks are inevitable given the age of the distribution system, explaining that the benchmark for line loss is about 10 or 15 percent. According to city budget information, $1.6 million was spent from the Water Fund in 2014 for distribution/collection line improvements. The amended 2015 Water Fund budget allocated $2.6 million, and the fund's adopted budget for 2016 directed $1.5 million to line improvements.

The city has also said about 10 percent of production goes to backwash, the process of using finished water to clean filters at the two treatment plants.

The panel questioned if growth projections merited the need for more water. According to the city's rate consultant, average-day demand will reach 8.5 million gallons a day by 2026, an 8-percent increase over last year.

The 15 million-gallon a day plant the city plans on building to treat its Lake Ouachita allocation would give it more than 43 million gallons of treatment capacity, adding to the 28.33 million gallons the state said the city can treat at its 50-year-old Ouachita Plant on upper Lake Hamilton and 70-year-old Lakeside Plant that processes raw water from the city reservoir at Lake Ricks.

The updated draft of the city's water supply study presented earlier this year said demand can be met until at least 2037 if the Lake Ouachita allocation is added to the city's production portfolio. The addition of the 20 million-gallon a day allocation from DeGray Lake the city has right of first refusal to would ensure the city's water future into the next century, the city has said.

The panel challenged the need for that kind of long-range planning, explaining that systems typically plan for only 20 to 30 years out.

State Sen. Alan Clark, R-District 13, of Lonsdale, cautioned that defeating the rate increase would continue giving the city a rationale for restricting water service outside the corporate limits. The restrictions were imposed after maximum-day production reached 81.47 percent of capacity in 2012.

According to the Health Department's 2012 survey, maximum-day production spiked to more than 23 million gallons that year. Average daily production was 14.8 million gallons, and according to the city's rate consultant, average-daily demand was 9 million gallons.

Clark, who co-chairs the Water Provider Legislative Task Force, said the policy of limiting access in the unincorporated area of the city's service territory has come at the expense of growth and development. Preventing the Lake Ouachita allocation from coming online would allow the city to further justify its connection and extension policy, he told the gathering.

"They think somehow they're going to force people to annex by shutting off the water in the county," he said. "Just the opposite of that has happened. People don't want anything to do with being in the city.

"The fact we're stopping growth makes me want to pull my hair out," he said. "I don't want to give them the excuse that they don't have water, and that you guys stopped them."

Local on 11/14/2017
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