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Unicoi residents show in force against utility bill hike

May 22nd, 2014 10:03 pm by Brad Hicks

Unicoi residents show in force against utility bill hike

(Photos by Lee Talbert/Johnson City Press)

UNICOI — As Unicoi Water Utility District customers brace for a 28 percent increase on their June bills, a number of those customers showed up at a public meeting Thursday evening at utility office to voice their concerns over increase.

More than 40 customers attended Thursday’s meeting, and primary concerns among those who spoke were what some felt was a lack of transparency on the part of the district’s Board of Commissioners and a lack of community involvement in the actions that led to the increase.

The commissioners opened the meeting by providing background information on what prompted the rate hike. Board Chairman John Mosley said in November 2009, the board voted to move forward with the drilling of a well in the hopes the utility could find its own water source. After the topic was discussed at several public meetings, the issuance of a bond not to exceed $2.8 million was approved in June 2010.

This project ceased in August 2010, and the utility moved forward with another well-drilling project on a nearby property with the same purpose in mind, Mosley said. That project was stopped in May 2011, one month before the first payment on the bond issue was due.

Mosley said if the wells would have proven themselves to be productive, the entirety of the bond issue would have went toward the infrastructure necessary to support them as a water source. Approximately $250,000 of the bond issue funds was spent on the well-drilling projects. Mosley said a successful effort could have meant lower bills for utility customers.

“That was the thought process,” he said.

However, when the wells were determined to be unproductive, Mosley said the district used the remainder of the money for items to improve utility operations, such as new vehicles, a new tank and improved meter readers as the money could not be returned without penalty.

Earlier this month, utility customers received a letter signed by Mosley and Utility Manager Lee Bennett stating the utility had “no alternative” but to raise rates, with a 28 percent increase going into effect May 1. The letter said the rate increase was recommended by the Tennessee Comptroller’s Office due to yearly financial losses by the utility district and the state mandated the 28 percent hike.

“We don’t have to accept it, but they’ll come in and shut us down,” he said.

Mosley said Thursday that if the state came in and took control of the utility, it would not lead to a decrease in the new rate. On the contrary, the rate increase could be even higher if the state absorbed the utility, he said.

According to Mosley, the rate hike should have been implemented three years ago, as the district has been paying around $184,000 annually toward the bond issue, resulting in yearly losses for the utility.

Some customers present said they were unaware an increase was even on the table until they received the utility’s letter.

“When I received my letter, I had to read it twice to make sure it wasn’t a scam,” customer Jack Gouge said.

Unicoi resident Garland James said he accepts his part in not knowing what was going on, as notices of the utility board’s meetings are printed on the back of each bill. Still, he said he felt the board could have communicated better with its customers.

“Everything said tonight falls back on that one thing,” James said. “We weren’t informed.”

“It was complete news to me until I got that letter,” one customer said.

Others wanted to know why the utility’s commissioners did not seek the public’s input before proceeding with approval of the bond issue.

“You’re speculating on hitting water,” Jim Britt said. “It’s like an oil driller. He’s going to speculate he’s going to hit oil, but he’s got backers and investors. We’re the investors right here. I mean, you were trying to find water but you come up dry, and now we’re stuck with a bill that’s through the roof.”

“The bottom line is you all rolled the dice and didn’t ask us if we wanted to gamble,” another customer said.

Customer Joe Chambers asked the board if it the possibility of selling the district to another utility was an option.

“If that would happen, that would ease a whole lot of problems and complaints that people have,” he said.

In the days after the utility sent its letter about the rate increase, Jeff Linville and David Rogers, two former utility district commissoners, issued their own statement. In it, they contend that only around 10 percent of the bond issue was used for the drilling of the exploratory wells, not the entire $2.5 million. The rest, they stated, was used by the utility for legitimate purposes.

Linville was present at Thursday’s meeting, and said his and Rogers’ statement was made not to criticize the utility, but it was done in an effort to clarify the utility’s actual expenditures of the bond. Linville said Thursday that utility did benefit from the bond issue funds.

“My letter was not complaining about what the rate is,” Linville said. “The state mandates it. My letter was to get it out that, ‘Hey, it wasn’t 2.5 million for two wells.’ There was a whole lot of other good in it.”

Mosley said he agreed with Gouge that the letter sent out by the utility district was not clear.

Utility customer Roger Cooper has closely followed the board’s actions over the past few years closely. He said the commissioners should not require public input before acting, as its meetings are open to the public and the board is made up of elected representatives. He said the utility must raise its rates.

“We have great water, we have a great utility,” Cooper said. “We’re in debt, and rather than discussing all the things negative, let’s work together and get through it. We will get the debt paid off in a few years.”

Mosley said the district will advertise its future meetings for the next “five or six months” in the local newspaper. He said if customers do not attend these meetings, the utility will stop advertising in the paper.

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