Archive for Wednesday, July 28, 2004

Water discussion heats up meeting

July 28, 2004

Something needs to be done to ensure Tonganoxie has water for its future.

But, City Administrator Shane Krull said, that future should not depend on Basehor's Suburban Water company.

Suburban Water is owned by Ray Breuer. His son, Mike Breuer, is president.

"The time has come to tell Ray and Mike Breuer that the city is not interested in their services," Krull said at Monday night's city council meeting. "... My wisdom is telling me that it is time to move on, inform Suburban thanks but no thanks, and ultimately sign the agreement with BPU (Board of Public Utilities). Anything else, in my opinion, is a waste of everyone's time and money."

Krull said the city should focus on negotiating an agreement to purchase water from the Kansas City, Kansas, Board of Public Utilities.

This plan would entail constructing a 10.2-mile 12-inch water line from the BPU hookup near Basehor at a cost of about $2.3 million. When the cost of financing is included in the 20-year note, the total price will be about $3.7 million.

What's caused a little controversy and confusion in recent months is the fact that Suburban has almost completed construction of its own 10-mile pipeline that runs from a BPU hookup near Basehor to Tonganoxie. And next spring, Suburban will install a 1.3 million-gallon water-storage tank on a hilltop west of Tonganoxie.

Airing concerns

In a gentleman-style argument -- without raising their voices -- Krull and Mike Breuer, and council members, aired their concerns.

Three council members said they want the city to proceed with negotiations with BPU.

Preceding what would become a heated discussion, Krull read a three-page report in which he recommended, for various reasons, that the city not sign on with Suburban.

First among Krull's complaints was a recent political advertisement in The Mirror in which Suburban said it would be "substantially cheaper" for the city to hook onto Suburban's water line, rather than to build a 10-mile line at an estimated cost of $2.6 million.

"I found the underlying tone of the advertisement to be insulting," Krull said.

Krull noted that in 2002, Suburban's proposal was that the company would provide 1,000 gallons of water for $2.47.

But Suburban has recently increased that amount to $2.87, Krull said.

"This represents a 16.2 percent increase in a 21-month period," Krull said, noting that the Board of Pubic Utilities, from which Suburban purchased part of their water, had not increased its wholesale rates during that same time period.

If the city built a pipeline from the BPU hookup to Tonganoxie, the construction would be paid off in 20 years using low-interest loans provided through the state. The 10.2-mile pipeline is projected to cost about $2.3 million, Krull said. However, he's used the $2.6 million figure, he said, "to inform the customers up front on the highest cost estimate."

Krull said Suburban had offered an 18-year contract with the city. But he noted that Suburban itself has a 20-year contract with BPU that started in 2000.

According to 2000 statistics, Suburban can currently supply 410 gallons per minute from its own wells, Krull said.

"Suburban's direct customers and its wholesale customer, RWD 10, already utilize 399 gallons per minute during peak days," Krull said. "What happens to the city if Suburban is unable or unwilling to renegotiate a contract with BPU? Suburban, by itself, cannot meet the supply requirements of its current customers and the city without outside help."

Krull said that several years ago the city contacted Suburban, as well as other water suppliers about supplying water to the city. The city had also looked into increasing the amount of water it purchases from Bonner Springs. But, Krull said, an engineering study late showed there was need for considerable upgrades to that supply system.

That's when the city began talking to BPU, which Krull said presented an affordable means for the city to establish a connection for a long-term wholesale relationship.

Meanwhile, Suburban has consistently made lengthy, unsolicited presentations at city council meetings, Krull said.

Although Suburban's presentations were numerous, Krull said, they contained few concrete facts as far as cost, water pressure and water quality.

Emotions running high

Mike Breuer told the council members he was sorry for any misunderstanding caused by Suburban's political advertisement.

"We are dealing with our livelihoods here and the emotions are running a little high," Breuer said. "Our intention was to inform the public that there was something going on and a fight with city council was not our intention at all."

Breuer said he was offended by Krull's intimation that Suburban wouldn't be a good business partner for the city.

"So to say we don't have the community at heart, well I'm put off by that," Breuer said. "We've been in this county for 60 years and we've provided water for a lot of people. There's a lot of people in this city that we've helped with water problems."

Breuer said he thought, considering the area's growth, that the city would quickly outgrow Tonganoxie's proposed single 12-inch water line. Breuer questioned whether BPU would work with the city to provide even more water if demand ultimately exceeded expectations.

And, Breuer said, in constructing the pipeline to hook on with BPU, the city would be unwisely relying too much on the one line.

Krull responded to Breuer's comments.

"But BPU is good enough for you to sign up with," Krull said. "How many issues are there, Mike?"

What about emergencies

"If you cut your line or Stranger Creek washes it out, you would be in trouble," Breuer said.

The members present voiced their opinions. Velda Roberts said it's important for the city to be in charge.

"We are better dealing with the source (BPU) than with the middleman," Roberts said. "...I am ready for us to say that the best way for us to proceed is if we want to go to BPU, we need to concentrate on the BPU contract."

Roberts told Breuer she appreciated his time.

"But I would really like to see us be in control of our destiny -- with no middleman," Roberts added.

Council member Ron Cranor said he's tired of feeling as if Suburban is holding the city hostage. And, he said that in his opinion that the facts and figures presented by Suburban have been inadequate.

"I'm of the opinion that unless you're in black and white you shouldn't be talking," Cranor said.

He compared the situation to a vehicle purchase.

"I just assumed that when a person comes to a meeting and wants to sell you a new car, they've got the specifications for the new car," Cranor said. "And I've never seen that."

Steve Gumm agreed.

"We've asked three or four different times to get those written proposals," Gumm said.

Breuer cautioned that BPU might not be as easy to work with as Suburban would be.

Krull said he wasn't against the possibility of agreeing to having an emergency interconnect with Suburban, which currently has a pipeline within 1,500 feet of Tonganoxie's water plant.

But Krull said, he would be against having a mandatory minimum monthly water purchase go along with the emergency hookup. That's in part, Krull noted, because in the winter, the city's production of water from its own wells would still supply a significant portion of the city's water.

"There's no need to buy a minimum water supply from you when we could supply it ourselves," Krull said.

Breuer reminded Krull that in 2002, when Tonganoxie suffered a severe water shortage, Suburban offered to help.

"Time has evolved," Krull responded. "The city needs to look not only at tomorrow, but it also needs to look at tomorrow 50 years from now."

And, Krull noted that Suburban's prices had gone up since making the first proposal.

"What is it -- you can't make a decision when you're fighting with yourselves," Krull said. "I'm frustrated about it. I mean you're pleasant enough to talk to but we're wasting each other's time."

Krull noted he'd scheduled a meeting with BPU officials on Thursday so that the city could proceed in that direction.

Despite the heated debate, Breuer thanked Krull for his frank comments about the water situation. And, although Breuer was aware that the council seemed willing to proceed with negotiations with BPU, Breuer told council members he'd be back in two weeks with more concrete information.

"I'm glad Shane made those comments he did," Breuer said. "It was like getting a pie in the face, but I'm glad."

And Breuer pressed the issue further, indicating Suburban was spending a lot of money on the pipeline and water storage tank.

But Krull noted that the city had not asked Suburban to do the work. He said to Breuer: "You guys build your system and we'll build our system."

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