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Saturday, May 8, 2010

PSWID agrees to buy sandy Milk Ranch Well for $400,000 before appraisal can 'gum up the works'

May 5, 2010 PSWID (Pine Strawberry Water Improvement District) Meeting

By Sam Schwalm
Gazette Contributor

Presentation by Economists.com
Mr. Dan Jackson of Economists.com made a presentation to try and quell the public’s concerns about the deficits that PSWID has been running. I will write more about that once I have a copy of the presentation material.

Board Votes to Buy the Milk Ranch Well for $400,000
The board voted 6-1 to buy the Milk Ranch well for $400,000. There was some mention that PSWID would also be providing 50 residential connections and two commercial connections as part of the deal. Details on the agreement were not provided in the meeting. Mr. Haney dissented.

The appraisal being done by Tetra Tech has not been delivered yet. When asked why they were moving ahead without the appraisal, Mr. Dickinson said that it hadn’t been started and they couldn’t wait for it. Mr. Tanner Henry, the district’s engineer, stated that it had been started and was just waiting for the recent pump test data to complete.

As part of the pump testing, samples have been taken and have been provided to a filtration company for analysis and to form the basis for a proposal for sand abatement. According to Mr. Haney, depending on the material found in the water, abatement costs could range from $10,000 to $150,000. Mr. Haney’s objection to going forward with the purchase was that without the information on what the filtration costs will be, the value of the well can’t be determined.

Compass Bank has to approve all transactions over $100,000.

Comment: What do you do if your attempt to get your own appraiser appointed to value your property fails and you don’t think you will like the number on the appraisal? You close the deal before the appraisal arrives and gums up the works. It is hard to imagine any explanation as to why the board could not wait a couple of weeks for the appraisal. It is hard to imagine a reason why the board couldn’t wait a few weeks to determine what the filtration costs are going to be.

Hundreds of thousands of dollars are being spent without the information that the board needs to make a sound decision. This well is not going to be in service this summer, so why couldn’t they have waited a couple of weeks to get the information that they needed?

Comment: There isn’t enough information to tell whether the $400,000 is a good price or not. One thing that needs to be known is the side deals. The mention of the 50 residential and two commercial connections probably implies that at the least the impact fees would be waived, which is probably a $50,000 to $75,000 value. If PSWID has to cover line extensions for those meters the value could be much higher. Reduced water rates could also add to the total cost. Not to mention the $64,000 that the district has already spent repairing the well and the filtration costs that are yet to be determined.

Miscellaneous
The board said that they have short-listed three applicants for the position of General Manager. They will be contacting the applicants and will be setting up interviews of the canidates with the board.
The board said that they have short-listed three legal firms to take over the legal counsel duties of Ms. Stephanie Gliege who has resigned as the district’s lawyer.

Next regular PSWID Meeting: Wednesday May 26, 2010 at 7:00 PM at the Pine Cultural Center

This article is from the group Water For Pine Strawberry. We will be providing these articles after each of the PSWID meetings with a summary of what the board did, additional facts that are relevant to what went on, and some commentary. 

Water For Pine Strawberry is a group of residents who are concerned about the communities water issues and how they can best be resolved. Visit our web site, www.WaterForPineStrawberry.com, for more information. The website for PSWID is www.pswid.org .

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