No, I’m not talking about the regime’s attempts to manipulate the council and mayoral elections. Today I wish to discuss the potential sale of the Arnold sewer system to Missouri American Water. This will be on your November ballot as Prop S, Arnold residents.It should be noted that a similar effort was beaten back in 2012, with unions leading the fight.
At the August 7 Arnold city council meeting, when a crowd of angry city employees showed up to express their displeasure over a potential pay freeze and increased out-of-pocket health care costs, mayor Ron Counts had a tease for the crowd, according to the Leader:
“We’re not in a crisis yet; we’re trying to prevent one,” he said. “There is light at the end of the tunnel.” Counts said he was working on something that should help the budget but he couldn’t yet reveal what it was. “Hang in a little longer,” he said.
Well, we found out one week later, as a special council meeting was called on August 14 to vote to place on the November ballot the sale of the sewer system. The meeting was called during the last week to place items on the ballot. The meeting, which lasted seven minutes, did not include any opportunity for public comment. Phil Amato was the lone vote against the ballot measure; he wanted to investigate another entity that he thought might want to buy the sewer.
Fruits of the Sale
If approved, the city would sell the sewer system for $13.2 million. According to Yes on S Arnold (more on that later), the sale would transfer the city’s $14 million debt to the Metropolitan Sewer District (MSD) to Missouri American and eliminate the city’s $8 million bond debt. The site also states that the city will do $6 million in street and sidewalk improvements with the proceeds of the sale. The August 21 Leader reports that the city will net $5.2 million from the sale and also gain access to the $4 million sewer reserve fund, for a $9.2 windfall. At the September 18 council meeting, the mayor distributed a list (PDF – see page 5) of projects that the city would do with the cash. It was as follows:
- Melody Lane – $2 million
- Farmcrest – $160,000
- Old Lemay Ferry/Richardson – $400,000
- Ultra-thin Overlay (1 mile) – $110,880
- 2-inch Overlay (1 mile) – $227,040
- Concrete Streets (1 mile) – $807,840
- Concrete Sidewalks (1 mile) – $126,720
- Re-plaster Indoor Pool – $95,000
- New Flooring at Rec Center – $50,000
The projects in the list would cost a total of $3,997,480, which would leave $2 million left over from that $6 million of promised improvements. A couple of council members have some other ideas, too. Phil Amato wants to put in a second outdoor water slide at the rec center, purchase the property between the Rec Center and Sherwood Elementary for an Olympic swimming pool to share with the Fox school district, and buy a snow plow. Jason Fulbright wants to get brine tanks, which have something to do with salt for the roads in winter. I’m sure there will be many more ideas.
Mounting a Campaign
The August 21 Leader article also states that Missouri American will cover the costs of the election and any marketing for the campaign. And oh, have they ever. A political action committee (PAC) called Clean Water Healthy Communities has been formed by Missouri American (the addresses of the treasurer and deputy treasurer are the same as that of the company). Missouri American has funded the PAC as follows:
- $25,000 on 8/19/14
- $75,000 on 9/17/14
- $100,000 on 9/29/14
That’s $200,000 total, folks. This cash has gone towards the creation of the aforementioned website as well as a Facebook page (the page had about 40 likes when I shared it, and the next day it had about 110 – perhaps I deserve a fee from the PAC for that). However, I would argue that Arnold is participating in the campaign, in its tried and true way. The city proposed at the October 2 council meeting to raise sewer rates (PDF p. 37) from the current $73 per quarter ($24.33 per month) to $128.70 per quarter ($42.90 per month) if Prop S fails; a 76% increase . This comes across as a clear threat to voters. The rate hike was tabled at the meeting, but it gave the PAC what it needed to produce this graphic (posted on Facebook):
Yes on S Arnold graphic of potential sewer rate hikes
According to the Leader, Missouri American would not be able to raise rates until 2016, and a company spokesperson said they project to be charging $30 per month at that time. Now, the city admits that it has been derelict in raising rates. Jacob Engineering did a study in 2012 that said the city should have raised rates at that time. Their recommendation would have led to current rates of $103 per quarter (34.33 per month), with additional hikes required for improvements. In a September 11 ad in the Leader, the city said “Over the last twenty years the sewer rates were held artificially low because the City Council was reluctant to raise them.” Interpretation: they didn’t want to risk losing their council seats. Perhaps council members Paul Freese, Phil Amato, and Butch Cooley, who have spent much time on the council, should be asked about this dereliction of duty. But why not raise the rates now to $103 per quarter instead of the proposed $128.70? Not enough shock value in the lower number?
While the city council members are focused on the cash windfall that would result from the sale, the other arguments the city is putting forth are that Missouri American will charge lower rates than the city (see above) and that Missouri American has the expertise to deal with increasing federal and state regulations and the resources to invest in sewer upgrades. Missouri American promises to do $5 million in immediate upgrades if the sale goes through. The company would have to go to the Public Service Commission to get approval for any rate increases, although that seems to be a low bar (witness all of Ameren’s recent rate hikes).
We are less than a month from Election Day, and this campaign is really just getting started. It was a disservice by the city to get this ball rolling so late; there will not be time to properly educate the voters about this issue. In addition, the voters probably will only hear one side of the story, as there appears to be no organized opposition to the ballot measure, and if such opposition emerges, it won’t have $200,000 to spend. Here is a collection of documents I have cited above: