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Water/sewer conflict weighs on LCDA budget proposal

POSTED: June 14, 2012 7:00 a.m.

The running dispute over water and sewer service fees between the Liberty County Development Authority and Midway was a murky subject Monday during the LCDA board’s fiscal year 2013 budget workshop.

Board member Al Williams brought the issue up while discussing the $304,971 water and sewer operations budget. Each entity owes the other funds related to services as early as 2006, but the organizations have yet to agree on certain details.

County Chairman John McIver said the Midway City Council is discussing it with its attorney James Coppage, but Williams said council members told him they have not heard from Coppage in months.

After discussion, LCDA attorney Kelly Davis said that he and Coppage have been in talks, but Coppage has been out of town for the last 10 days.

Previous Courier reports state that Midway Mayor Dr. Clemontine Washington reported a lack of progress toward settling the dispute and that Coppage said he has been unable to meet with Davis.

On Monday, Davis said the attorneys recently discussed enlisting a third party from the Georgia Rural Water Association, which serves both parties.

Williams said the message he is getting from council members is not consistent with what attorneys are conveying.

LCDA CEO Ron Tolley said the messages sent through attorneys have not been consistent with the Courier’s coverage of Midway City Council meetings.

“(Third-party mediation) is something you had proposed a while back, like in December, but they had rejected it,” Tolley said. “But then I saw a later article in the newspaper more recently that indicated that they wanted to go to arbitration.”

Williams said that no one has suggested the idea of calling on Georgia Rural Water Association to the Midway council.

 “I don’t want to discuss it too much, because litigation has been threatened, or at least discussed, but all I can say is that we both feel that it would be productive … Hopefully, both parties will meet and we can work out something,” Davis said.

McIver asked whether it was out of order for the board to discuss the issue, since it was not listed on the agenda, but Secretary Brian Smith said the issue directly affects the budget, as the funds owed and anticipated are accounted for in the proposal.

A $20,000 legal fee is also proposed, which Cole said assumes work related to the Midway agreement. In contrast, the FY12 budget projected $5,000 in legal services related to the water/sewer operations budget, and no funds have been expended for that purpose.  

The operations budget anticipates $6.415 million in revenues and expenditures, up from a proposed $5.937 million in FY12.
Revenue changes include calling on $1.625 million from fund balance and increased property taxes, leasing an additional office in the building to Strategic Business Solutions and leasing to Florapharm in Hinesville Technology Park.

Florapharm’s presence also reduces maintenance costs at the park from $51,935 in projected end-year costs to $8,584 in FY13.

Debt service payments account for about $3.832 million, with a $1.335 million payment toward SunTrust Loan C, which covers the stalled water reclamation facility at Tradeport East.

Salaries and wages decreased from the current budget but increased from the projected end-year, moving from $319,082 to $335,929 to accommodate a 3 percent cost-of-living adjustment and to place 2 percent in reserve for potential merit use later.
 
LCDA Finance and Administration Director Carmen Cole gave an overview of the highlights from fiscal year 2012, which ends June 30. Cole said the authority will see a 35 percent increase in revenues to $7.290 million. The rise stems from an 11 percent increase in property taxes collected, a $1.79 million federal grant  and $1.1 million in timber sales.

The LCDA also cut expenses by about 12 percent to $4.264 million due to administrative moves and alterations to facility maintenance.

The board will formally adopt the FY13 budget during its June 25 meeting at 8:30 a.m.

In other news, the LCDA also:

• approved a $122 million bond issuance to Firth Rixson Forgings for facility expansions that will accommodate increased output and more employees. Under the agreement, Firth Rixson will receive abatement from ad valorem taxes in exchange with meeting employment quotas, while the LCDA will draw 1/8 of a percent on the bond, a potential revenue stream of $152,000.

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