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State Comptroller’s Office Recommends Spencer Utility District Merger

/ The Upper Cumberland's News Leader
State Comptroller’s Office Recommends Spencer Utility District Merger

The State Comptroller’s Office Water and Wastewater Financing Board recommended Thursday that the Spencer Utility District merge with the Warren County Utility District.

Technical Secretary Ross Colona said he sees an opportunity for a long-term solution for the city’s water supply issues.

“I haven’t been able to see the efficiencies that can be created for them running their own utility, because we continue to see issues come up over there,” Colona said. “We do have general concern of the water that is being served in that area.”

Colona said Spencer could hook into the Warren County Utility District and purchase all of its water. Colona said he spoke with the Warren County general manager who seems open to the idea. Colona said as far as Spencer’s government, it is less willing to accept that recommendation.

“They believe there is good reason for them to continue ownership and running their own utility,” Colona said.

Spencer’s Engineer Consultant Nathaniel Green said he disagreed with a merger and wants the Financing Board to mandate the Warren County district to take over the city’s utility district. Green said he believes purchasing the water would not be financially feasible.

“Warren County Utility District prepared a letter that would be presented at Spencer’s March board meeting that includes the statement that the district has ‘capacity to assist at Spencer’s request and that the feasibility and cost must be considered.’ The letter requires that Spencer formal requests the assistance of Warren County Utility District prior to the matter being further considered by the district.”

In the short term, the city will be required to contract with a qualified expert to review its utility district. The ruling is an outcome of a State Comptroller investigation conducted in February 2022.

According to the report, the entity will review appropriate water and sewer rate increases, policies to ensure water and sewer funds are not misused and evaluate the potential merger with Warren County Utility District.

According to the report, a contract with the city and the entity conducting the review must be submitted to the State Comptroller’s Office by June 3rd. The rate study and recommended changes must be provided to the state office by the end of the year. Two six month deadlines may be awarded if good cause is found.

If the city fails to comply, the State Comptroller’s Office will issue non-criminal subpoenas to city officials to appear in-person before the water board.

“Should the City fail to comply with any directive in this order, Board staff and Counsel shall issue subpoenas for the City’s governing body and Manager to appear in-person before the Board during its next meeting following non-compliance of this order,” the report said.

Technical Secretary Ross Colona said a large concern is the rates since the city has not increased them since 2017.

Rates could be increased in two ways through the contract with an approved entity. The group would determine if a 2020 rate study is still appropriate. If it is determined that the costs are inaccurate, a new rate study will be performed. Colona said whatever the result may be will be recommended for adoption.

Engineer Nathaniel Green said the 2020 study showed a need to double the city’s sewer rate. The Spencer Board of Aldermen did not implement the recommendation.


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