Central Arkansas Water will recommend consolidation with Maumelle Water Management to become Maumelle's water provider in light of a preliminary feasibility study by the Little Rock-based utility, Graham Rich, the utility's chief executive officer, said Tuesday.
A presentation on the feasibility study and potential consolidation with Maumelle Water Management is on the agenda for Central Arkansas Water's Board of Commissioners monthly meeting Thursday.
If it does acquire the Maumelle utility, Central Arkansas Water wouldn't take over its sewer services. Options for that portion, Rich said, include North Little Rock Wastewater to operate Maumelle's wastewater treatment system, a proposal the North Little Rock utility has examined as part of Central Arkansas Water's study.
"It would appear we are going to make the recommendation to consolidate," Rich said during a presentation to the North Little Rock Wastewater Treatment Commission at its Tuesday meeting. "There are a number of positives to acquiring the [Maumelle water] system.
"It only makes sense if there is a benefit to Maumelle and to us," Rich said.
North Little Rock's commissioners voted to do a more in-depth look at the possible wastewater merger with Maumelle. Other options would be for Maumelle Water Management to continue only for wastewater services or for the city of Maumelle to manage the operation, said Marc Wilkins, North Little Rock's Wastewater Department director.
"This is not a binding issue," Rich told the board. "We had promised Maumelle Water Management that we would come up with some [wastewater treatment] options for them."
Maumelle Water Management's Board of Commissioners also met later Tuesday, but it limited its discussion on any potential action by Central Arkansas Water so as "not to make assumptions," Chairman Dave Kaufman said during the meeting. Commissioners have received the preliminary study, and Maumelle city aldermen have begun meeting with Central Arkansas Water representatives about the study, city officials said.
"They need to present it to their board before they present it to us," Kaufman said of Central Arkansas Water administrators. "They don't know what they can do yet."
Kaufman and Commissioner Mary Peyton said after the Maumelle meeting that they weren't aware of Rich's statement at the North Little Rock meeting, and they didn't want to comment on the proposal until receiving its final version. Commissioner Ralph Kearney was absent.
North Little Rock's preliminary study estimated that the North Little Rock utility could gain $700,000-$800,000 in net revenue by adding Maumelle's customers, but further study is necessary to find any "deal breakers" such as potential environmental problems or higher than expected operation costs, said Dan Jackson of Willdan-Economists.com, a consultant for the North Little Rock utility.
North Little Rock's operation of of Maumelle's sewer services would mean a higher bill initially for Maumelle Water Management customers, but the cost would be less expensive for Maumelle in the future, Jackson added. Maumelle customers pay about $16-$17 for sewer services, while North Little Rock customers pay about $24 a month.
"Maumelle's rate is part of the trouble Maumelle has now," Jackson said, explaining that Maumelle's revenue doesn't cover its operation.
North Little Rock Wastewater has a plan for sewer rate increases over a five-year period for its North Little Rock customers, Wilkins said, but a proposal hasn't been presented to the City Council, which would need to approve any increase.
Maumelle Water Management customers will have a 9 percent increase for water and sewer rates on their next monthly bills for September's usage. Also, rates for sprinkler meters are rising 15 percent and a monthly debt service fee will increase from a set amount of $7.86 to $8.25. The Maumelle City Council approved the water commission's recommendation for the increases in July, effective Sept. 1.
Metro on 09/09/2015