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Sue Guinn Legg

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Capital outlay proposed to address water losses in Jonesborough

June 16th, 2013 8:14 pm by Sue Guinn Legg

Capital outlay proposed to address water losses in Jonesborough

In a special called meeting Monday for second and final reading and approval of the town of Jonesborough’s 2013-14 budget, the board of Mayor and Aldermen will consider a $450,000 capital outlay to address water loss, a problem repeatedly cited as a significant deficiency in the town’s annual audits.

If approved by the board, the funds will be used for construction of a one-mile,12-inch ductile water line extension along U.S. 11E to Limestone.

In a letter recommending the outlay note, Town Administrator Bob Browning advised the board members, “We are going to be spending a lot of money anyway repairing leaks. We have fixed over 35 leaks in the last month in this area.”

Browning said the estimated $458,524 cost of the new water line would be funded through a $450,000 loan from the U.S. Department of Agriculture’s Office of Rural Development to be repaid over 12 years at 3 percent interest.

According to Browning, the cost of the outlay will be met by the elimination of water loss for which the town currently receives no revenue and the potential for funding remaining from a 6.5-mile extension of Jonesborough’s wastewater outfall lines along Highway 81 South to the Nolichucky River.

“If we go ahead and submit a revised environmental revenue on the water line extension and ... if we have remaining funds on the Phase Two (wastewater outfall line) project, we can reimburse ourselves for the cost of installing the water line. That will be the plan,” Browning said.

The outlay note would bring the total principal owed on the town’s water and sewer projects to $1.17 million. At 3 percent interest, the $450,000 capital outlay note would add an additional $35,000 in principal payment and $9,890 in debt service to the town’s 2013-14 water fund budget.

Other proposed amendments to the total $12.9 million budget approved by the board on first reading May 30 include $400,000 for street paving to be offset by an existing $400,000 in general fund capital outlay revenue, and $305,000 for the purchase of eight new police cars to be offset by the removal of a $305,000 auto leasing expenditure, bringing the total revised budget to $13,724,905.

The budget continues to include no increase in Jonesborough’s property tax rate or water and garbage collection fees. It also features a 5 percent across-the-board pay raise for all town employees.

At the board’s May 30 budget meeting, Mayor Kelly Wolfe said the town will reassess its water/sewer revenue and cost projections again in September and determine if any changes in rates are needed at that time. 

In January, an audit report on the town’s operations for fiscal year 2011-12 included a finding of significant deficiency in water losses more than 20 percent beyond the limit set by Tennessee’s Utility Management Review Board. The deficiency was also cited in a town audit for the previous fiscal year.

In a response to the finding also included in the 2011-12 audit report, the town said it is in the process of replacing all of its water meters with more accurately calibrated meters that will reduce the amount of water recorded as lost. 

Auditors reported total annual water losses of 55.6 percent for each of the past two fiscal years. 

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