To the editor:

 

Upon my reading the Polk County resolution for a water agreement with ICWD in Friday’s Tryon Daily Bulletin, I found that this Resolution is definitely slanted in favor of ICWD and their attempts to convince the reader that this contract is the only good option for Polk County taxpayers and water customers with regard to administration of Polk County’s water resources.

 

In my opinion, the right agreement could certainly prove beneficial to all parties. However, based on the single-minded perspective presented in the proposed resolution, I am inclined to suggest that Polk County Board of Commissioners invest in one or more experts to assist with this complicated transaction, and to proceed with caution, before signing away our water distribution rights for the next 75 years or beyond.

 

As a member of the board that acquired Lake Adger, I would hope that the current board would do their homework and find out why we agreed to purchase Lake Adger and our vision for its future use.

I have listed some excerpts from the Draft Resolution, along with my comments about each.

 

· “ICWD donated …the Broad River Water Line to Polk County …at a cost of $4.03 million” – this statement inaccurately represents what actually occurred. This was not a donation. The cost of $4.03 million for the construction of this line was, in essence, a negotiated price (i.e. the “price equivalent” that ICWD was willing to pay Polk County, or the “value” that Polk County received from ICWD for allowing ICWD to access finished water from Broad River Water Authority across Polk County soil). At the time of this transaction, ICWD, Polk County and BRWA all considered the Broad River Water Line as a win-win-win situation. ICWD desired to purchase finished water at higher volumes and lower prices than it had previously been able to do through its former supplier; Broad River Water Authority desired to increase its sales volume of finished water due to the loss of customers over several decades which had driven up operating costs; and Polk County desired to provide those citizens hardest hit by the drought conditions at the time with a more dependable alternative water source, while at the same time, beginning to plan for longer term water needs throughout the county. Why was ownership of the Broad River Line by Polk County a necessary part of the initial agreement between Polk, BRWA, and ICWD? Because ownership of the water lines determines who has distribution rights within the county. Back then, it was a mandatory term in the eyes of Polk County BOC that we own the lines, and thus control the distribution of water throughout the county. Now, the Polk County BOC seems to have abandoned that stipulation by trading away permanent water distribution rights within our county in exchange for some dam repairs that the previous BOC’s had planned and budgeted to address.

 

• · “Polk County provides water service to approximately 142 customers who use the Broad River Line”– this is true. However, it is also true that Polk County is a fledgling system, which was intended to grow at a slow, methodical pace to coincide with growth in the county. Additionally, Polk County BOC incorporated the water line extension plan into its overall strategic plan for the county. Growth of the customer base may be impacted and is expected to be impacted in several ways, which have not been taken into account in this resolution or in the terms of this contract. For instance, Polk County government and the Towns of Columbus, Tryon and Saluda have the potential to combine resources to create a countywide water system which would grow the customer base for the system rapidly, with one of the ultimate goals of utilizing Lake Adger as its primary water source. The creation of a Polk County Water Authority has been suggested as a means to bring this to fruition. The prospect of this merger of systems, coupled with the natural growth of the customer base due to development, drought, and other potential reasons, would increase the customer base to much more than the 2030 projections offered in this resolution.

 

• · “ICWD provides all customer services for the Polk County water system and assets” – this is true to the extent that these terms were part of the initial contract agreement between Polk County and ICWD. This agreement currently allows Polk to take advantage of ICWD’s economies of scale, which was another of the initial incentives provided by ICWD to Polk as an additional enticement for Polk’s cooperation in allowing the construction of the Broad River Line across Polk County. What’s the hurry to change the existing relationship? Why not simply extend the current agreement for another 10 or 20 years, and then sell ICWD the option to purchase a specified amount of raw water from Polk County (i.e. Lake Adger water) at a bulk rate for the same period, in exchange for dam maintenance and/or lake dredging and maintenance?

 

• · “establishing its own water system would require Polk County to invest in the personnel, equipment, facilities, water supply resources, customer service and billing systems, financial resources and other assets and technical skills required to efficiently operate such a system” – It depends on a multitude of factors. For instance, Polk could continue to contract with ICWD to manage Polk’s system until such time as Polk determined it was feasible or cost effective to make those investments. Certainly with the current customer base, this would be the best solution. However, in the event of the merger between Polk County Water System and one or more of the towns’ water systems, the customer base would change substantially, and the new entity (Polk Water Authority or other name) could determine the break-even point at which it would be prudent to make those investments. Another very important consideration here is that the resolution language says that we don’t have the resources (human, equipment, etc.) to run our own system. Again, with the merger of one or more of the Towns’ systems we also inherit assets (including human resources with expertise at running water plants, at least some equipment, facilities, billing resources, etc…). So let’s not sell ourselves short. We have the ability to create and manage a water system, and in so doing, continue to employ most or all of those employees currently employed by the towns’ systems. The customer base would provide the revenue necessary to make it go. This could free up town resources and funding for other needs. And the larger customer base could keep water rates affordable, while providing customers with a more dependable water source. In the distant future, as the customer base grows, at some point the Water Authority would determine a break-even point at which it would be cost-effective to build a water treatment plant.

 

• · “current customer growth forecasts for Polk County’s water service indicate that even if such service expands in a sustained and effective way…Polk County will serve less than 1,000 customers by 2030” – Again, it depends. That may be so if none of the towns’ systems merge with the county system. But “what if” there is a merger of systems? Then that would change everything. Also, more importantly, we cannot predict Polk’s growth accurately over the next 15 years, much less the next 75 years. What about those additional 60 years of growth impacted by this contract? How will we handle Polk’s water needs then? All customers are not the same. Of the 142 customers, some are residential households, some are businesses, and some are industrial customers. How much water does the average household require daily? Business? Industrial customer? For that matter, given the presence of the TIEC equestrian facility, how much water does just one horse require daily?

 

If, after reading these comments and the many other unresolved issues and unanswered questions, the Polk BOC is bound and determined to go through with this water agreement, why in the world would our commissioners not invest in one or more experts in the field of utility contracts to ensure that they and ultimately, the citizens of Polk County, are getting the best possible value in exchange for the assets they are bargaining with? We only get one chance to get this agreement right, so why do it in haste, when an expert representing our interests could be obtained to review and amend the contract accordingly, in our favor? Regardless of the length of the contract or the concessions made by ICWD in its current form, our commissioners owe it to the taxpayers to hire our own qualified experts to represent Polk County’s interests. In the scheme of things, a small investment may pay huge dividends for Polk County.

 

Several of the commissioners stated that they understand what is in the contract. I know they are each intelligent individuals and I am sure that they have read the document and understand what is in it. My concern is more about what is “not” in the contract. That’s where an expert in such matters can shed some light for our commissioners to make a more-informed decision. It’s not what’s in this contract that should concern our commissioners, it is what is not in this contract that they should lose sleep over.

 

Tommy Melton
Columbus, N.C.