By Scott Halasz
XENIA — It appears negotiations between the city and county on a new water contract have dried up.
County Administrator Brandon Huddleson said Monday that the county’s plan is to move forward with constructing it’s own $5.5 million water system and hooking up to the North Beavercreek Water Treatment Plant to serve its customers in Shawnee Hills, Cedarville and Wilberforce.
“Based on our financial analysis, it is more cost effective to produce our own water,” Huddleson said. “We are planning to proceed in that direction.”
According to figures calculated by the county’s financial analysis, the annual debt service cost would range from $551,000 in year one to $574,279 in year 20, when the bonds are retired. The city rate begins at $578,730 and increases to $651,366 in five years with 3 percent inflation, according to the documents.
The city has been selling the county water for those areas since 1998, when the two signed a 20-year agreement. The deal gives the city the right to include up to a 50 percent surcharge for supplying water sold to county customers, which county officials have questioned, saying it cases a financial strain.
According to records, the county paid $713,520 to the city for water in 2015 but collected only $633,358. With debt service and personnel costs, the county had a $203,614 deficit.
In late August the county commissioners informed city leaders that they will not renew the contract when it expires in 2018. In September, city council agreed negotiate a lower surcharge rate with county officials, agreeing to reduce the extra charge to 20 percent, providing the county agrees to that number and at least a 20-year contract when the current deal expires in June 2018. The reduction in the surcharge would cost the city around $100,000 annually, according to City Manager Brent Merriman. The cost of the county not-renewing the contract could cost the city more than $700,000 annually.
The county responded by asking for an informal request for proposal (RFP) for five, 10 and 20 year contract periods with the city’s lowest and best final offer.
On Sept. 22, council authorized Merriman to submit a proposal matching Greene County’s cost for constructing and maintaining its own water system as long as the overall unit price doesn’t dip below Xenia’s current residential rate.
“The City of Xenia continues to be open to a partnership with Greene County for the provision of water services,” Merriman said. “We have brought numerous ideas and reasonable offers to the table in the hopes that an amenable resolution could be reached. While their analysis is not yet fully complete, it appears the county government has in the meantime made a general determination that they want to grow their system. If this is their final position, the city will adjust accordingly. We are fully confident that we can continue to provide a very cost competitive and reliable water service to customers who choose to invest in our system.”
Contact Scott Halasz at 937-502-4507.