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Water Department customer purchase under consideration
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The measure to liquidate 101 water customers of the city of McMinnville and sell them to Warren County Utility District will soon be under consideration by the McMinnville Board of Mayor and Aldermen.
Water Department director Anthony Pelham says he has received a written proposal for the purchase, the blessings of State Revolving Loan Fund, and the measure should be under consideration by the full board May 24.
“I know it has taken some time but we did get a response back from SRF in regard to Rolling Hills. Basically, short and sweet, they found no issue with the proposed sale,” Pelham said. “I request this be on the agenda for the next meeting. It has already passed through committee and we do have a written offer from Warren County for your consideration.”
The State Revolving Loan Fund is the creditor for all current McMinnville Water Department debt. Because the city is selling customers and reducing its revenue stream, its approval was sought.
“It was a courtesy inquiry to make sure our only creditor did not object,” said Pelham. “It wasn’t a requirement. SRF is a division within TDEC (Tennessee Department of Environment and Conservation). So we always want their blessing in water and sewer matters.”
On the day before Christmas, a city water line in Charles Creek burst leaving those 101 customers without water until the next day. Because the break could not be fixed in a timely manner, the city asked assistance from the neighboring water department and it has been supplying those customers since that time. Warren County Utility District manager Mike Green made an offer of $101,000 to retain those customers permanently.
If the city relinquishes those customers, it will avoid having to pay $78,000 to repair the water line, $15,000 for a project on Rolling Hills 3rd Avenue, and $4,000 to WCUD for its assistance in emergency repairs to supply Rolling Hills with water after the break. At stake is approximately $50,000 in annual revenue from those customers. However, the city does not net that amount.
The Board of Mayor and Aldermen meets on the second floor of City Hall at 7 p.m.