Upgraded Honey Creek Pump Station Approved

Members of the Grove Municipal Services Authority board have approved spending $9,500 to Rose & McCreary for civil engineering services to upgrade the Honey Creek booster pump station. An estimated 200 new homes could be added south of Honey Creek as a result, engineers estimated. Total cost is estimated at $75,000 to $100,000 for the pump and new larger water line.

The board was told Tuesday at its regular meeting that work on utility re-locations along Highway 59 is virtually complete, and Nov. 15 has been set as the final completion date. ODOT says it will let bids in January, begin highway construction in April, and be finished 18 months later.

GMSA also approved a new policy on customer disputes of water or gas bills. The new process involves 10 steps and was put together by City Manager Bruce Johnson. These include:

1. Customer shall notify the GMSA office manager of a problem within 10 working days of the due date printed on the disputed bill.
2. Office manager will review and correct any billing error immediately.
3. If a meter re-read is necessary, it shall be done within 24 hours of the notice.
4. If the re-read shows an error was made or the meter was not working properly, the reading and/or meter will be changed and the bill will be adjusted accordingly.
5. If the re-read shows the reading was correct and meter is working properly, no adjustment will be made.
6. The customer may request a company specializing in such testing to check the meter for accuracy. If testing shows the meter is working correctly, the customer will pay for the testing; if not, GMSA will pay the cost of testing.
7. After researching the disputed bill the Office Manager will make a decision within five working days after receipt of the complaint. If customer is not satisfied the customer has the right to request a meeting with the General Manager within five working days to dispute the bill.
8. After reviewing the bill, the General Manager will make a decision within five working days.
9. If the customer is not satisfied with the General Manager's decision, a written request may be submitted to have the matter presented to the GMSA Board of Trustees for the next regular meeting. The written request must be made within 10 working days of the General Manager's decision or his decision will be final.
10 GMSA will review the request and the board's decision is final.

The new policy grew out of a complaint filed by a homeowner who received a natural gas bill for $2400 last winter.

Huge Water Leak Found in City

A huge water leak---24 million gallons a year estimated by utility workers---was discovered at the end of Evans Drive near Buffalo Shores North, enough water to feed 400 new homes. And Wednesday night another five leaks were found south of Honey Creek Bridge, no estimate yet on how much water is involved.
City Manager Bruce Johnson and two GMSA employees went to the scene at 1 a.m., shut off the city water supply, and the leak stopped, flowing the water into Grand Lake's Honey Creek at the Melody Point Cove, Councilman Larry Parham said.
An earlier leak found downtown during utility construction measured 1.6 million gallons a year, which was repaired. Total water loss for the city had been estimated at 44%, which is now down to 38%. Councilman Larry Parham noted that if the leaks get down to 22% the city will not need to upgrade its water processing plant and could save millions of dollars. The city treats 800 million gallons a year, he said.

GMSA Says Pay the $2400 Gas Bill

After several months of investigation, Grove Municipal Services Authority board members have told customer Tim M. Langley to pay his gas bill for two months of service, amounting to around $2400, despite the fact that this is 600% higher than normal.

Langley, General Manager of the Grove Sun Daily the past four years, had protested the bill for service last winter and had asked the board for an investigation into how so much gas could be used, a radical departure from his normal winter bills. GMSA had failed to read the meter for one month, January, and when Langley received the bill for two months of service at more than $2400 his eyebrows went up. His normal bill he said was around $250-$300 per month in the winter.

Board member Larry Green spent several weeks analyzing the problem, including meter failure, meter tampering, gas fired equipment in the house, and concluded that "the gas went through the meter and was basically metered correctly." Langley said he had no opportunity to have the meter tested at a neutral facility and asked for arbitration.

The board voted 4-0 to have Langley pay the bill.

In other GMSA action:

--The board approved a lease agreement with Precision Wi-Fi for the placement of antennas on top of three city water towers for a three-year period. Precision will pay $50 per antenna per month, or $16,200 over the period for three antennas per tower.

--Heard presentations on natural gas supplies from Constellation New Energy of Louisville, KY, and OneOK, of Tulsa. OneOK has had the gas contract for the city since 2003, during which time the cost of natural gas has gone from 5.25 decatherms to 7.17 decatherms in 2007. The GMSA board must now consider the issues of price, reliability, accountability and knowledge when issuing a new contract for gas service. Constellation owns Cornerstone Energy, which supplies gas to Simmons. Current gas prices are down 15% in the past four weeks, board members were told.

A Look at GMSA's 07-08 Budget

(second of two parts)

The Grove Municipal Services Authority Budget for 2007-08 approved by City Council is even larger than the city's budget, with total expenses set at $13,326,498 and revenue of $13,706,203 and only $8400 in the General Fund's contingency and zero in the Capital fund. This is down from last year's expensed budget of $16,426,000 and income of $16,703,000 due to fewer capital improvement costs.

On the income side, biggest receipts will be from sale of gas, at $4,872,000, and water sales at $1,424,000. The City of Grove gets its water free, from the Grand Lake intake on Honey Creek.

Major expenditure administrative accounts are personal services (salaries, wages, etc) at $479,000; and contractual services at $822,000 including sanitation pickup of $328,000. Under water treatment plant, there is $139,000 in personal services and $152,000 in contractual services plus commodities of $142,000. Total water treatment plant expenditures are $461,000 with another $251,000 in the water distribution budget.

Sewer treatment personal services total $200,000 plus $83,000 under sewer collection; contractual services total $108,000 plus $36,000 under sewer collection; and commodities total $60,000 and 29,000 under sewer collection. Total sewer budget is $371,000 under sewer treatment and $151,000 under sewer collection.

Natural gas personal services totals $142,000 plus $4,385,000 in contractural services, $34,000 in commodities, and $11,000 for other charges, totaling $4,573,854.

The GMSA Capital Projects budget totals $833,544 including $100,000 for new water meters; 706,000 in transfers to the General Fund; and $19,000 for software lease. A Total of $89,000 is budgeted for water treatment capital projects including $67,000 for an emergency backup generator at the intake plant.

Revenues under GMSA Capital Projects are set at $3,720,544 with $2,100,000 of that under "2005 note drawdowns." Another $810,000 from ODOT reimbursements for the Highway 59 utility relocation project is included.

A total of $2,209,000 is budgeted for water distribution and $227,000 for sewer collection. Total expenditures for natural gas are budgeted at $340,000. Grand totals for water,sewer and gas expenditures are approximately $3,720,000.

Non departmental expenditures are set at $271,000.

A total of $377,000 was transferred to GMSA Capital from City Capital, to cover money lost when the June 1 utility rate increase was abated by a 4-1 vote of City Council. The GMSA board had voted 5-0 to allow the increase to take effect.

Two members of the Council and two members from GMSA have been appointed to "scrub" the budget of GMSA, looking for excess or waste.

Analysis: The Planned Utility Rate Increases

If one takes out all the campaign rhetoric and promises and focuses strictly on the numbers, the proposed utility rate increases planned for June 1 are so minimal for most residents the issue is hardly worth discussing. And if abated, there will be dire consequences for the city. Yet some city councilmen may go ahead with plans to kill the increase and put the city in real trouble.

--41% of utility users -- those who use under 3,000 gallons of water/sewer a month and 100 mcf of gas-- will see a rate increase on water, sewer and gas of only 30 cents a month.

--Most users --62% who use 5,000 gallons of water/sewer a month--will see a rate increase of only $2.06 cents a month.

--Actual increases run from 1.72% to 4%, for the three utilities.

--Added up for all users, $360,000 will have to be transferred from the City's Capital Budget to make up the shortfall if the rate increase is abated, as Councilman Larry Parham has proposed.

--Many Grove residents will not live to see the day when all of the debt for GMSA is paid off, in 2024-25. A total of four bond issues are currently being paid off at a rate of more than $1.5 million per year and the GMSA cannot borrow another penny. These bonds go back to 1989 with a total of $18.1 million in notes. A 1989 bond expires in 2014-15; a 2005 bond expires in 2020-21; the 2006 bond expires in 2018-19; a wastewater treatment plant bond won't expire until 2024-25 and the four-tenths sales tax won't expire until 2020-21.

--If GMSA were a sick human, it would be a patient in the critical care ward on life support, just a few breaths from death. The only thing holding it together is the movement of money from one account to another.

--Grove's water rates are the lowest of 16 cities surveyed by the Oklahoma Municipal League, since Grove is the only city that gets free water from Grand Lake.

--$700,000 of GMSA's Capital Budget has to be transferred to cover operations and maintenance costs. No spare parts are available. There is no spare generator for the water plant's lake intake. Fifteen years of rate neglect are piling up.

--Two new schools are opening soon; a new hospital is in the works; a huge casino is planned which will drink lots of water and make flushing sounds, and new homes are being built across Grove. All will need water, sewer and gas. New industry which may come to town will also require utilities. Both the water treatment and waste treatment plants are maxed out and estimated costs to expand them approach $4 million, yet there is no money available and no way to borrow it.

Yet Councilman Larry Parham, who made campaign promises to "vote against proposed utility rate increases" persists in his work to abate the increases, which go into effect by Ordinance #526 on June 1, approved by the previous council.

GMSA's trust authority members will consider the issue at a special joint meeting with Council at 4:30 p.m. Wednesday May 23. The sense is that GMSA will turn away the request to abate the rate increases, leaving Council in the embarrassing position of looking into their eyeballs and overriding the very people they appointed to manage GMSA on a sound businesslike basis. GMSA board members realize they have a fiduciary responsibility to keep GMSA in the black.

Citizens who want to keep the infrastructure of Grove from a further free fall would be well advised to attend this meeting and get informed on the facts, rather than run on the emotion of a campaign hangover and coffee shop numbers.