The Shirley City Council clarified its position on the sale of its water system to Community Water at its Oct. 8 meeting, with the declaration that the system would be going out for bid.
At issue was a state statute that required any sale by a city valued at over $20,000 to go out for bid. This created a conflict with a second, older, statute, which would have allowed the city to sell the system without bidding. In the minutes of the Oct. 8 meeting attorney Matt Gilmore told the council that both statutes apply, requiring the city to both put the system out for bid and gather the required signatures from property owners to allow the sale.
Community Water is currently acting as the interim operator of the Shirley Water System, pending the system’s sale. That both statutes apply was confirmed by Community Water General Manager Tim Shaw during an Oct. 16 interview.
The Van Buren County Democrat reported last week that the system would not need to go out for bid, based upon an interview with Shirley Councilman David Cook. Cook said that after Gilmore’s review it was apparent the system would go out for bid, due to both statutes applying. This was confirmed by Shaw.
Shaw and Cook both confirmed that the system was valued at over $20,000.
Per the minutes from the Oct. 8 meeting, the city updated its ordinance to show that both statutes apply (written as “BOTH statutes apply” in the minutes) and, “… outlining the requirement for a pre-bid conference, as well as the bidding requirements of a token amount of $1 as well as agreeing to repair and maintain the system with no unexpected rate increases.“
Gilmore, once the ordinance was updated, is recorded telling the council “there was no reason to further delay the process” as the council voted to begin collection of petition signatures in advance of the sale.
The minutes of the meeting continue: “Mayor Hackett clarified that the City is not attempting to sell its water system for money, but transfer a failing system to a company that agrees and can afford to take on the cost of the needed repairs and upgrades. She noted that the approval for the ANRC funding was contingent on CWS [Community Water System] taking over the system, and asked PMI Engineer John Metrailer if there was a time limit on this funding. Mr. Metrailer stated that because of our unique situation there was no time limit.”
Part of the needed upgrade for the system is the replacement of the main water feed line going into the city, a sizeable project, planned to be done by boring under the Little Red River.
Shaw addressed the council, telling them, per the minutes “the Shirley Water System is indeed failing,” with Community Water having to fix over eight leaks and several water meters to date, despite it having an interim business relationship with the community. The city was billed for 1.8 million gallons of water, despite billing its customers for 500,000 gallons, Shaw said, calling it “a huge amount of water loss.”
The loss was due to a variety of factors, including a third of the loss being “water meter related” with the rest due to undetected leaks “or a glitch in the software billing system,” it was reported.