Jasper board to consider sale of water system

Jasper board to consider sale of water system

May 19th, 2019 by Ryan Lewis in Local Regional News

JASPER, Tenn. – City officials in Jasper are about to reopen discussions with Tennessee American Water about the potential sale of the town's water and sewer systems.

At the Jasper Board of Mayor and Aldermen's May meeting, Mayor Paul Evans said Tennessee American Water made a pitch over a year ago to do just that, but the company's offer was "a joke."

"At the time, they gave us a quote of $2.3 million for our water and sewer system, which is not, you know, there's no way," he said.

Jasper's assets on those two systems are over $26 million, Evans said, and the water treatment and sewer treatment plants are insured for $11 million.

When Evans told Tennessee American Water representatives at the time that the company's offer was "not adequate," he said they told him depreciation had to be considered.

"Yes, you look at depreciation, but also, too, look at the insurance," Evans said. "If your house is insured for $250,000, and it's a total loss, you're going to get $250,000. You're not going to get depreciation value. That's the way I look at it."

Evans said Tennessee American Water offered Signal Mountain $3.4 million recently for its system.

"And they [Signal Mountain] only have a fraction of what we have and no infrastructure to speak of," he said.

If Tennessee American Water wants to negotiate with Jasper, Evans said, "let's sit down and throw a real figure out there that we can start looking at."

The board voted 4-1 to initiate discussions with Tennessee American Water.

City Attorney Mark Raines said the company has contacted Jasper "several times" over the years about the potential purchase of the two systems, and the board's vote was just to entertain discussions about a possible sale.

"The board is not committing to do anything," he said.

"There's no 'For Sale' sign on the water company," Alderman Josh Jennings added.

Sam Sharpe, Jasper's director of water operations, said the state has cited some things that need to be addressed at the town's water plant, but hasn't ordered that it be replaced.

"Our water plant is still in good shape," Evans said. "We're not at capacity. Yes, we could use a new one, but as far as the state coming in and telling us that we have to have a new [plant], I haven't been told that."

Evans, who cast the lone dissenting vote, said any discussion with Tennessee American Water would have to include whether or not the company would assume Jasper's $1.2 million debt service on the water and sewer systems.

Evans said he would make contact with Tennessee American Water to open discussions and would report to the board the results of that contact at its next meeting on June 10.

"You never know until you talk," Alderman Paul "Mac" Bumpus said. "Let's see what they've got, and then we'll counter, vote it down, or whatever."

Ryan Lewis is based in Marion County. Contact him at ryanlewis34@gmail.com.