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WC Utility tries to buy water customers
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Warren County Utility District has offered to purchase 101 water customers from McMinnville Water Department for $101,000. The customers are in the Rolling Hills area.
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 a neighboring water department and it's been supplying those customers since Christmas.
According to McMinnville Water Department director Anthony Pelham, the mutual aid has resulted in a request from Warren County Utility District manager Mike Green to retain those customers permanently.
“The line break at Rolling Hills over the holidays has been, obviously, very difficult,” said Pelham. “We have 101 current active customers in Rolling Hills. Because of the mutual aid with Warren County Utility District and their ability to serve them, versus the money we’re getting ready to have to spend, I’ve done a brief return on investment calculation to show you what they’ve offered.”
According to Pelham, Warren County Utility District will purchase those customers for $101,000, minus $5,000 for legal services and $5,000 for miscellaneous transfer expenses. 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.
Also at stake, said Pelham, is approximately $50,000 in annual revenue from those customers.
“It’s probably about a $49,000 to $50,000 a year in revenue we generate from Rolling Hills,” he said. “But we are looking at about $200,000 cash savings immediately from the sale and cost avoidance. There is no right or wrong. I would like for you to look at that and have a discussion at a later time.”
The change could be a slight financial savings for residents in that area. By the information presented by Pelham, the average bill estimated is $40.56 per month which is 4,000 gallons of water including sales tax.
WCUD’s domestic water rate for 4,000 gallons of water is $37.32, which includes sales tax.
McMinnville officials have yet to discuss the offer.