The Edmond Sun

August 2, 2013

Testimony used against Guthrie voting on utility increases

Van Mitchell
Special to The Sun

GUTHRIE — The finance director for the City of Norman testified Wednesday in Logan County District Court that not having the ability to raise utility rates without a vote of the people has been detrimental for Norman’s ability to keep up with environmental mandates and necessary upgrades to its utility infrastructure.

Anthony Francisco, who has been Norman’s finance director since 1996, testified as part of a lawsuit against the City of Guthrie concerning the city’s ability to raise water and sewer rates without a vote of the people.

Currently, Norman is the only Oklahoma community that requires a vote of the people for utility rate increases.

The non-jury trial is being heard by Logan County District Court Judge Philip Corley. The lawsuit was filed by former Guthrie City Council member Patty Hazlewood and Karen Shandorff of Guthrie whose suit contends the power to raise rates and fees should be decided in an election and not by the city council.

The duo is asking Corley to require the city to put before a vote of the people a change to the city’s charter requiring any water and sewer utility rate increases must be approved by voters.

“The impact has been detrimental for the operations of the utilities from the standpoint in order to generate the revenues we need to do the things we desperately need to do. We have to go through an additional process of not just convincing the city council, but we also have to convince the voters,” Francisco said. “It will at least delay the utility rate structure of what we need it to be. It can also prevent those things (projects) from happening.”

Francisco was asked by Guthrie City Attorney Randel Shadid whether he thought having voters decide utility rate increases made sense.

“In my opinion it is a bad decision to have voters deciding utility rates,” he said. “They should be decided by elected officials.

Francisco testified that the City of Norman has had plans to replace its sewer treatment facility since 2001 but that project has been delayed.

“We have been delayed since 2001 for various reasons. Among them having an inadequate rate structure to make the improvements we know we need to make,” Francisco said.

Francisco said Norman is currently under a DEQ consent order because of insufficient capacity for sewage treatment at its wastewater treatment facility.

“The consent order in a worst case scenario is we could have fines up to $10,000 a day for not complying with the consent order,” he said. “They can also impose a moratorium on (new) building because we cannot provide water capacity for future development.”

Francisco said Norman voters have approved several water rate increases as well as defeating several ballot measures for water and sanitation. He said the city has not had a sewer rate increase in many years.

Francisco said it costs the city about $30,000 for a special election for utility rate increases.

“We have put off needed improvements to our capital infrastructure for those utilities and we continue to operate the best we can,” he said. “Obviously, that has long-term negative impacts.”

John Wolf, vice president of Municipal Financial Services of Edmond serves as the City of Guthrie’s financial advisor. MFS also works with the City of Norman and the City of Chickasha.

Wolf testified that voters in Chickasha had repealed their charter requirement for voter approval for utility rates.

He said prior to that change it was difficult for the city to keep up with and pay for its infrastructure needs.

 “When it (charter change) was taken out, the city had a better ability to fund those needs,” Wolf said.

Bill Myers, CEO of Myers Engineering of Norman testified his firm serves as the engineering advisor for the city of Guthrie. He said his firm works with about 40 other Oklahoma municipalities.

Myers testified that Guthrie’s wastewater treatment facility is outdated and needs upgrading to meet DEQ standards. He said it would cost between $3 million and $4 million to complete those changes.

Myers said it would be better to make the changes instead of paying DEQ fines.

“It would be better to fix the infrastructure and protect the environment instead of paying fines,” he said.

Myers also testified that operational costs and cost of chemicals have significantly raised for water treatment and wastewater treatment plants over the past seven years.

“We have seen the cost of chemicals go up dramatically over the past seven years,” Myers said. “Cities are using more chemicals to meet the new standards.”

Myers also testified about how much water capacity Guthrie’s new $15 million water treatment facility could produce.

He said Guthrie’s facility has the capacity to produce up to six million gallons of water per day and says the plant currently produces between 4.2 million and 4.5 million gallons of water per day for Guthrie and Langston.

Myers testified that the City of Guthrie was working on finalizing contracts to sell water to the City of Coyle and to Rural Water District 1 which he said could produce additional revenue for the city.

Guthrie City Clerk/Treasurer Wanda Calvert testified that if the charter proposal is passed it could have financial ramifications for the city and the Guthrie Public Works Authority which oversees the city’s water and sewer programs.

“If they (voters) pass it I believe it will be devastating for the City and the GWPA budgets,” Calvert said.

Shadid rested for the city while Hazlewood’s attorney Chris Harper of Edmond told Corley his final witness Stan Ward, a Norman attorney was unable to testify Wednesday.

Corley told both parties to work with him on finding a suitable court date for Ward’s testimony.

A new court date has not yet been scheduled.