Fort Smith Board pushes back on water, sanitation plans

The Fort Smith Board of Directors took issue with two proposals from city officials at the Tuesday (Jan. 24) study session.

The first was a recommendation the Board transfer 30 remote water customers to Locke-Fern and Dollard Road Waterworks (LFDR) to avoid building a $120,000 pump station required in order to continue servicing those accounts. The second was for an independent rate study for the city’s sanitation department that will likely lead to a rate increase for Fort Smith customers.

The water customer transfers led off the meeting with heavy questioning from Director Tracy Pennartz. The new Lake Fort Smith 48-inch water transmission line being constructed in three phases requires that with each phase, the corresponding portions of the city’s existing 27-inch water transmission line be retired from service. The line was constructed in 1935, and until the 1980s, the city allowed direct water service connections for wholesale water systems and individual retail water users. This practice ended in 1984 when the city implemented a “Water Transmission Line Tap Policy” preventing additional direct caps to be made on water transmission lines.

In 2015, the policy was updated again to address specific issues that would arise with the construction of the first phase in the new 48-inch line and to provide guidance for future decisions. The city recommended on Tuesday that the remaining 30 remote customers be transferred to LFDR to avoid the pump station expense and to remove any future maintenance costs associated with maintaining those customers.

Pennartz was particularly concerned about turning over a newly built distribution line, a $432,000 city asset, to another entity without restoring the expense. She also believed Fort Smith rate payers had not been adequately instructed they were “subsidizing” the remote customers’ additional costs to this point. Also, she added, “How is it that if LFDR will take those customers from us, that they can’t make the necessary connections to those 30 customers off their current distribution lines and current user association relationships?”

Fort Smith’s Deputy Director of Engineering Michelle Dodroe said at the time of the design, “this idea was not approached.”

“It was brought up and the idea was out there, but the idea was not vetted. It was decided around 2014 or 2015, and unfortunately the individuals responsible are not here to ask,” Dodroe said. Former Fort Smith Utilities Director Steve Parke retired in April 2016.

Also Tuesday, Fort Smith Sanitation Director Mark Schlievert recommended Burns & McDonnell over finalist Arcadis to handle a rate study for the department. Burns & McDonnell, which works with the city on its $480 million consent decree through the services of Interim Utilities Director Bob Roddy, was chosen in part because of that experience with the city as well as its familiarity with the city’s administration and finance departments and the fact they have “completed similar work with other clients in Arkansas.”

Schlievert argued against pushback for an in-house rate study, claiming it would take “five years” for the city to perform the full scope of services on itself, “and by then you’re working with outdated information.”

The department is an enterprise fund and must earn the money it spends. For at least the past two years, it has not had adequate funding to maintain needed capital expenditures, so a rate study would help determine efficiencies as well as highlight any needed capital. Director Kevin Settle argued that with the rate study, “I think you’re trying to justify a rate increase by using an outside party instead of going in-house. No rate study has ever left rates alone or resulted in a rate decrease. You know it’s going to happen. Put it out there, and tell the citizens that is what’s going to happen.”

Settle also recommended that any rate study the Board would approve also factor in private collection services in the area.