Water Department Superintendent Kelly Arnold, at right, speaks at the joint meeting between the city Water Department and Upshur County PSDs and Water Associations. / Photo by Katie Kuba

City Water Department officials, Public Service Districts discuss benefits of a nonprofit water plant model

BUCKHANNON – The City of Buckhannon Water Board met with members of Upshur County Public Service Districts Sept. 29 to share information and forge improved communications between the two entities.

City officials also touted the benefits of the municipality remaining in control of its Water Plant, as opposed to selling it to a for-profit utility company.

Those Upshur County PSDs and Water Associations included representatives from the Adrian PSD, the Elkins Road PSD, the Hodgesville PSD, the Tennerton PSD and the Mt. Hope Water Association who heard an overview of how the City of Buckhannon’s Water Plant functions, its budget, planned American Rescue Plan Act-funded expansions and projects. Several of the PSDs and water associations also shared their ARPA-funded projects.

Buckhannon Mayor Robbie Skinner said the purpose of the meeting was to make sure “everyone was on the same page.” He also shared information about how the city owning and operating its water plant saves residents money.

“We heard loud and clear whenever we went for our most recent rate increase that there was – although we thought we had put it in our minutes and it was put out to the PSDs – that communication is an issue,” Skinner said. “We want to make sure, going forward, we know what each other are doing and working on and how we can help each other.”

Amberle Jenkins, city finance and administrative director, said the last rate increase for the City of Buckhannon Water took place in August 2021. She shared that chemical costs, telemetry costs and material costs have risen nearly 20 percent. Jenkins said one advantage the City of Buckhannon has is that they can share some equipment among the different city departments and split the cost of those items among those departments.

City Water Department Superintendent Kelly Arnold spoke about the fact that the Randolph Street Water Plant in Buckhannon is getting older and continually requires maintenance and upgrades.

“The plant can only do so much; it is going to need rehabilitation and that will be an ongoing process to continue to upgrade,” Arnold said. “I think we all know that, and we have run into difficulty retaining people (workers), and I think we can see that all over the United States. In the water system, it has been hard because you are competing with bigger systems like West Virginia American Water and Clarksburg. We have lost a total of seven people since 2017.”

One reason is that water plant operator license levels depend upon the number of hours of experience operators have logged. For instance, Arnold said one water plant operator has a four-year chemistry degree, but cannot yet work unsupervised despite his advanced knowledge.

“We hired a guy who was working for the college, and he decided to come work for us,” Arnold said. “But even with that four-year degree, the way that the health department and West Virginia decide, he will need to have three years working before he can operate that plant by himself. Even though he can, there has to be someone with a Class III or Class IV [water plant operator’s] license with him at all times.”

Buckhannon City Councilman and Water Board Committee member Dave Thomas said water rates would go up dramatically for utility customers under a for-profit model.

“There is a great benefit for us to be a not-for-profit and own our own plant,” Thomas said. “We had been approached by a for-profit to give us quite a bit of money; if the water plant had been newer, the amount of money would have been astronomical. But one of the issues is, we heard from Weston, and they are now a for-profit, and they have lost control of everything. We still have control of everything that goes on with our water plant. I think the specificity we deal with on a day-to-day basis is fulfilling that we can do it ourselves, and we do not have to contract out to a for-profit company.”

“When I say dramatically, I mean, Robbie, how much would they go up?” Thomas asked Skinner. The mayor replied that the rates would cost the customers 300 to 400 percent more than they are currently paying.

“So, West Virginia American Water is the for-profit water operator in West Virginia,” Skinner shared. “They go all over the state, and they approached Buckhannon to see if they could look at our plant as a potential buyout to provide water for Buckhannon. They are already over in Weston. So, to make the most educated decision, they came up here and looked at our water plant.”

“It is older; they anticipated they would have to build us a new water plant within 15 years,” the mayor added. “That price tag to them looked like $30 to $40 million. So that basically took off $30 to $40 million that they were going to offer the City of Buckhannon, so we chose not to go any further. It was a good exercise to learn the valuation of our system and it was a good exercise to learn from the user side, if you will, our neighbors over in Lewis County.”

Skinner said he lives alone, and the water portion of his city bill is around $20 as an inside-the-city resident.

“My city utility bill with all of the other fees is $66 per month,” Skinner said. “If I were to live in Weston, just my water bill alone would be $68 with West Virginia American Water.”

Skinner said city officials had to consider if they really wanted to put their customers through that.

“Plus, we would lose total control,” Skinner pointed out. “If there is a leak or if there is a problem, you are at the mercy of West Virginia American Water to go out and fix it. There is a level of necessity when it is tied to a political entity. We obviously want to fix everything as quickly as possible because we want to keep our citizens and business owners happy. If they are unhappy, that affects what happens up here [on city council]. If we were a for-profit entity, it could be a while before they fix the problem. We found that out from our neighbors over in Lewis County; Amby (Jenkins) and I both talked to their City Manager and he said he wishes they could pull some of it back from West Virginia American Water, but that is a big undertaking because of all the money that is in play.”

Skinner said the water department is not making any moves to become a for-profit entity.

“It was a good exercise,” he said. “When we need to go to our citizens for a rate increase, those 15 to 25 percent rate increases look like nothing compared to [a scenario where] if we were to sell the water plant, our rates would go up 400 percent basically overnight … the amount of money [residents] would suddenly have to begin paying that they had not budgeted for because we sold the plant [is significant]. So, yes, the employees would receive raises and yes, the plant would receive the upgrades it needs faster than what we are going to be able to do.”

Skinner said before Buckhannon implemented their most recent rate increase in August 2021, they had the 33rd least expensive water rate in West Virginia out of the more than 200 water departments.

“When we looked at that rate study, everybody that was owned by West Virginia American Water was right there at the very tip top,” Skinner said. “I just heard on MetroNews that they are seeking an 8.4 percent increase in their coverage footprint. Back in March, they were approved for a 9 percent increase so that is almost a 20 percent rate increase in the year.”

Skinner told the PSDs that between the City of Buckhannon’s Water Plant and the PSDs, they provide water to 96 percent of Upshur County.

Buckhannon officials provided historical context, saying that around 1962, the City of Buckhannon acquired the water plant from West Virginia American Water, which has been in business for approximately 80 years in West Virginia. The Buckhannon Water Plant has been operated by the municipality for 60 years. They said one of the best things that happened to the citizens of Buckhannon was the acquisition of the water plant because it saved the residents millions of dollars over the years.

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