Signal Mountain town councilors still have not decided whether to sell the town’s municipally owned water system, and have postponed the decision on whether to order an independent water rate study.
The rate study, proposed by Councilman Dan Landrum in late August, was a response to Mayor Chris Howley’s suggestion that the council raise water rates for customers independent of the decision on whether or not to sell the system.
The council voted 4-0 at their Oct. 8 meeting to table the resolution ordering the rate study in order to give them and the public more time to review and discuss the results of an independent viability study that looks at the implications of the town keeping its water system. Performed by the University of Tennessee Municipal Technical Advisory Service, a contract consultant agency for cities around the state, the results of the viability study were presented to town officials at the end of September.
Councilwoman Amy Speek was absent for the Oct. 8 vote.
At the request of councilors, City Manager Boyd Veal is checking into whether MTAS staff is willing to present and explain the results of the viability study at a public meeting, as well as what information the town would need to provide to MTAS for the agency to conduct a rate study and what, exactly, that study would offer.
Mayor Chris Howley said he feels the MTAS viability study does not present a strong case for the town keeping its water system and he thinks the town should sell. He also reiterated that he doesn’t think the town should spend $3,000 for the rate study until the council decides whether to keep the system.
Councilman Brandon Anthony, who is new to the related proceedings, having replaced former Vice Mayor Dick Gee on the council at the end of August, noted that the rates will need to be raised no matter what. The town hasn’t raised its water rates in six years, and in that same period has been maintaining its system but not making capital improvements.
The two companies interested in purchasing the water system, Walden’s Ridge Utility District and Tennessee American Water, have also said they would raise customers’ base rate if they acquired the system.
Anthony suggested the town go ahead and raise the rates in order to build up the reserves to a point where, if the town decides to keep the system, it can afford to take on the necessary expenditures.
Veal pointed out that the preliminary sales contracts negotiated with WRUD and TAW are based on the town’s current rate structure. If the town changes that structure now those proposals would be moot, he said.
Councilors will discuss the water system again at their agenda work session Oct. 26 at 12:30 p.m. Citizens are welcome to attend, and a formal comment period is included on the agenda.
Email Emily Crisman at ecrisman@timesfreepress.com.