Utility representatives pitch proposal to Freeburg trustees

Posted 9/23/21

Liberty Utilities representatives Tena Marquie and Charlie Evans presented a proposal for acquiring and providing water and wastewater services for village residents to Freeburg trustees at their …

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Utility representatives pitch proposal to Freeburg trustees

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Liberty Utilities representatives Tena Marquie and Charlie Evans presented a proposal for acquiring and providing water and wastewater services for village residents to Freeburg trustees at their Sept. 13 meeting.

Marquie, a licensed water, wastewater, and distribution operator who served as vice president of operations for Aqua for 23 years, said the Joplin-based firm provides electric, natural gas, water, and wastewater service to six states, and is expanding in Missouri, Arkansas, and Georgia, the fastest-growing states. 

“Why choose Liberty? We are hometown. Your calls are answered here in Missouri,” Marquie said “Their parent company in Canada is one of the fastest-growing utility companies, operating in acquisition mode,” said Marquie.

Unlike the other two utility companies, Liberty has a designated person who regularly communicates with the mayor and deals with water and wastewater issues such as overdue bills, failure of customers to submit necessary paperwork, etc., relieving village trustees of that responsibility.

“We try to employ locally whenever possible,” said Marquie. “A certified operator on the wastewater side is required by Freeburg’s permit.” 

Those are hard to come by, she acknowledged. Freeburg’s current operator, Todd Feeler, has given his notice and a replacement is being sought. Marquie volunteered to help out during the interim. 

“We are experienced and have creative ways to try to help you during the transition,” she continued. “A big benefit is (that) we address infrastructure and provide capital upgrades. No more bond issues; seeking grants and loans would be a thing of the past.” 

Marquie said Liberty tries to increase rates gradually. 

“We are very cognizant of rates,” she added. “We are the most rate-sensitive utility company.” 

Marquie told trustees that Liberty is a tax-paying entity and participates in the community by offering economic development assistance. “If you want to grow, we want to help,” she added.

Liberty would provide all the capital, meaning the village would not have to go into debt. “The worst thing that can happen to a city is that they incur a lot of debt, it goes on for 30 years, and at the end of 30 years, you have paid for an old plant that may no longer meet requirements and you start the cycle all over again,” Marquie said. “These are things you would no longer have to worry about.”

Freeburg has 269 water and 152 wastewater customers. 

If Freeburg is interested, trustees would be asked to sign a non-disclosure agreement, meaning confidential information can be shared between the two entities without fear of that information being spread.

Next, Liberty would need an asset list, financial statements, and customer information. Liberty would check the wells and lagoon with respect to permit requirements and necessary testing.

After facilities are checked, Liberty would provide a letter of intent with its dollar offer for the water and wastewater system. Liberty would provide their initial rates and what rates would be requested after the first rate case with the Missouri Public Service Commission (PSC). 

If an agreement was made, an asset purchase agreement must be filed with the PSC. “They decide,” Marquie said. “They determine that we will improve your service and the quality of your service before the purchase is approved.” 

Liberty Utilities is a regulated utility company with rates set by the PSC. 

“If you don’t like it, we walk away,” Marquie continued. “You test drove the car and didn’t like it.”

At this point, it is not certain whether the trustees can vote to sell to Liberty or whether it would have to be brought to a vote of the people. It would be April before an election could be held if necessary.

Mayor Darryl Haller asked about rate increases. 

“The more money I throw at you, the more the rates will increase but I don’t want to buy a Cadillac when I can drive a Cavalier,” Marquie responded.

At this time, the lagoon is okay, according to Marquie, but she added that it is “probably on its last lucky prayer and with phosphorus testing coming down the line, it will have to have some improvements done to it plus DNR has been trying to push the lagoon systems out.”

Trustee Shane Zimmer asked what would change for the end user. Bills would be paid to Liberty and customers in arrears are offered payment plans and other options before their water would be shut off. 

When asked about the village’s current employees, Trustee Dale Struemph was told that while the water and wastewater would not be handled locally, a local person could serve as operations manager without a license, operating under Liberty’s license. Freeburg would still need to handle its streets. 

Trustee Glenn Haller asked about response times in emergencies. Marquie explained that Liberty’s policy is to contact the village within 30 minutes of a call and someone on site in an hour.

She suggested Freeburg gather their records on significant improvements to add value to the price. Upon acquisition, current rates are adopted and nothing will change until there is a rate case before the PSC.

Asked if any nearby communities were Liberty’s customers, Marquie noted there are several in the works, but she was not able to identify them because of non-disclosure agreements. 

Struemph inquired about the waterline replacements, saying that all the lines are under asphalt. Replacing lines and asphalt at the same time has been the village’s practice. Would Liberty follow its own plan for replacing lines or would the company coordinate with trustees so both could be done at the same time?

“We can coordinate that,” she responded.

“We have got a lot of thinking we need to do,” Mayor Haller said as the Liberty representatives left.

At the end of the meeting, the discussion returned to the Liberty proposal. Mayor Haller noted two other companies are doing the same thing. Struemph asked if they had contacted him as a result of advertising for the position. “No,” Haller responded. “They just called out of the blue.” 

Haller said he receives several such calls a year and generally just disregards them when things are good.

“My biggest hold-up on it is we’re selling it, our Freeburg asset, we’re getting rid of it,” said Zimmer. “They present all sunshine and rainbows when they come here. I want to know what are some of the things that people don’t like about it.”

“The rates will go up,” Struemph predicted. 

Mayor Haller agreed. “They say they won’t, but …”

“I guarantee they would go up,” Struemph interjected, pointing out Marquie mentioned obtaining grants. 

From experience, trustees know Freeburg’s rates are not high enough to be approved for those grants.

“There are some positives and some negatives, but we’ll just have to figure out what makes sense,” Mayor Haller said. “The way I look at it, we need to put more money into the system, which means we need to raise the rates.”

“Even if we don’t go with them,” said Zimmer.

“It may be an eye-opener for people,” Haller stated, “If the people in the town realize this does need (to be) fixed. We’re either going to do it now or pay for it later.” 

In other business, three applications have been received for the street/water/sewer commissioner position and two individuals were contacted for interviews. Applicants will be sought through the end of September.

* Several businesses have not yet filed their backflow reports. Initial letters were sent out July 20 and a second notice will be sent with water bills. 

* A water leak at Roger Reinkemeyer’s property resulted in 365,800 gallons of water with a bill of $1,100.

* Feeler reported asphalting will be done before the end of the month. 

* Free prescription drug pickup is set for Sat., Oct. 2 from 10 a.m. to 2 p.m. at City Hall. Sheriff Mike Bonham or a deputy will be on hand to ensure proper disposal. 

* Mayor Haller signed paperwork accepting American Rescue Plan Act (ARPA) funds. Freeburg representatives will meet with MRPC representatives on Sept. 20 to determine appropriate uses for more than $85,000. Haller hopes to use part of the money for the Gilbert Street project. 

* In financial news, Village Clerk Allen Gradel presented figures showing general fund income for August totaling $25,627.27. The village has $26,731.27 in a general revenue checking account and $468,574.40 in a general revenue money market. Sewer system checking stands at $37,091.36 and the sewer money market balance is $210,759.08. Freeburg’s purchasing account balance is $1,127.57. The total on hand for all accounts besides water is $744,283.68. The water department has $603,277.06 on hand for a grand total of $1,347,560.74. 

* General revenue bills were approved for $5,351.58; sewer bills totaled $1,592.55 and water expenses amounted to $5,029.02. 

* Freeburg’s next meeting will be at 6:30 p.m. on Oct. 4.