Before a decision is made on Central Arkansas Water becoming Maumelle's water provider, more city residents will get a chance to hear the utility's proposal, Maumelle Water Management commissioners agreed Tuesday.
Central Arkansas Water is proposing to become Maumelle's water provider by March 1. Central Arkansas Water officials made a presentation at a special meeting Tuesday of the Maumelle Water Management board of commissioners.
The three-member board decided to give residents more of an opportunity to hear about the plan.
A public meeting hasn't been set, but it should be held on an evening before the Oct. 13 regular Maumelle water board meeting, chairman Dave Kaufman said. Commissioners could then vote on Central Arkansas Water's offer.
Tuesday's water board meeting started just past 4:30 p.m., when many people weren't yet off work. It was open to the public, but the nearly full room held few people who weren't connected with the utility or Maumelle city government.
"It is a big change, a big decision," Kaufman said of the consolidation proposal. "The more we can get information out and know how everyone feels will help us make a decision. We represent them.
"A public meeting will help," he said. Setting it for a later time of day will also help more residents be able to hear the presentation, he said.
The water commissioners, rather than the Maumelle City Council, will have final say on whether to consolidate with Central Arkansas Water. Central Arkansas Water's board of commissioners approved the proposal Sept. 10.
"I've always said an informed ratepayer is our best friend," Maumelle Commissioner Ralph Kearney said. "We're not a secret society, no matter what some people have said. This is very, very important to explain to the public."
Central Arkansas Water administrators -- including several high-level staff members, the utility's rate consultant and two bond attorneys -- were hoping for a decision Tuesday so they could stay on the March 1 timeline.
"We're still going to try to meet that date," Central Arkansas Water Chief Executive Officer Graham Rich said after no decision was reached Tuesday. "The longer it takes, the more we'll have to question reaching that.
"We want to do what the Maumelle Water Management board wants us to do," Rich said. "I have no problem with that. Either way, we want to know what the community wants or doesn't want. That way both sides can move forward with what they need to do."
Under the proposal, Central Arkansas Water would assume responsibility as Maumelle's water provider. Because a 30-inch transmission line would need to be installed, extending from lines already under the Interstate 430 bridge, there would be at least a two-year transition period until "CAW water" would flow to Maumelle customers.
Current Maumelle water rates would be charged during the two-year transition period. After that, Maumelle customers would pay Central Arkansas Water's outside city retail rates -- the same rates Sherwood residents pay. The two utilities use different formulas for figuring their rates.
Consolidation would mean Maumelle would become part of Central Arkansas Water's current 125,000-customer base. Maumelle would get more water-usage capacity, with access to multiple water sources, and "award winning" water quality, said Tad Bohannon, Central Arkansas Water's chief legal counsel. He gave a 50-minute presentation Tuesday. Maumelle's water now comes from a system of 13 wells, and residents have long complained about the water quality.
Central Arkansas Water would immediately gain Maumelle's 10,500 water customers and higher year-round revenue at a time when "every water utility in the nation is experiencing declining water demands," Bohannon said. Central Arkansas Water's water sources are Lake Maumelle and Lake Winona. Its primary customer base is in Little Rock and North Little Rock.
Maumelle Water Management, which oversees water and sewer services in Maumelle, would either continue to exist, offering wastewater treatment services only, or look at other options by Dec. 31. Central Arkansas Water officials asked North Little Rock Wastewater to consider taking over Maumelle's wastewater treatment, and used the North Little Rock utility's figures in the proposal's financial model.
As part of its proposal, Central Arkansas Water would issue bonds to refinance the existing Maumelle Water Management. The debt would be paid by charging Maumelle water customers a $19.21 monthly fee per meter on their bills during the transition period of two years.
A separate surcharge for wastewater treatment was estimated at $6.03 per month during the Central Arkansas Water's meeting on Sept. 10. Maumelle Water Management's current $8.25 debt service fee would go away, leaving a net surcharge of $16.99 per month for the two-year transition period.
The surcharge would decrease to $9.35 monthly in 2018 when the transition period ends, then decrease again after 10 more years.
Metro on 09/23/2015