County to run Foothill water system
September 6, 2013
County commissioners voted unanimously Thursday to take over the troubled Sierra Country Estates water system, and directed staff to come up with an interim monthly rate.
That followed testimony by system owner Marsha Tomerlin that she never charged the 20 homeowners in the gated Foothill community for water use.
"Nobody in the subdivision paid for one glass of water," Tomerlin said. "We never charged for water use."
She also said the system she operated with her husband Bill did not develop a reserve account.
The county faced a deadline Friday from District Judge Tod Young to either take over the system or be appointed receivership.
Staff recommended the county assume ownership and control of the system to avoid oversight by the district court which would require the county to seek the court's approval for operation of the water system, including rate setting, capital assessments and charges.
"This creates an additional administrative and management burden on staff that would not be necessary if the county assumed direct ownership of the water system," Public Works Director Carl Ruschmeyer said in his report to the board.
The county agreed to take over the system within two weeks if an agreement can't be worked out with the Tomerlins, who have said in court documents they can't continue the operation.
Commissioners also approved a temporary $100,000 loan from the county's general fund reserve for short- to intermediate-term cash flow purposes.
The reserve is at $751,533, and the loan would be repaid within a year, without interest.
The Sierra Country Estates Water System is to be included in the Carson Valley Water Utility Fund as a separate department with separate cost accounting.
Sierra Creek Estates resident Steven Leandro urged the county to serve as a receiver rather than take ownership.
"That would give us time to come up with a noncounty solution and not take over a nonperforming county system," Leandro said.
He said a new private water company owner could utilize individual wells, and be an independent contractor with experience to meet all county and state regulations.
Leandro said homeowners were worried about the cost of the county's solution and advocated drilling private wells.
Evan Maxwell, president of the subdivision's homeowners' association, said the system's 20 customers were facing "hundreds of thousands of dollars" of expenses.
"The homeowners' association has never been in the position to control the system or its management. We tried to work with the owner. We are dedicated to finding a solution," Maxwell said.
Jennifer Carr, bureau chief for the Nevada Bureau of Safe Drinking, told commissioners when the system was built in 1994, it was in compliance.
She said there were no problems until 2006.
Commissioner Greg Lynn said there was "0 percent probability the state engineer would authorize 20 straws (wells) in the ground."
"What we will end up with a receivership is all of the responsibility and none of the authority," Lynn said.
Ruschmeyer agreed private wells were not a reasonable solution.
"We still have a $1.2 million in a water system sitting in the ground. We will have to maintain it," he said.
Anticipating the court action, commissioners authorized staff in August to draw up a plan for operation and maintenance of the system.
Ruschmeyer said Friday he anticipated bringing information to the board in October.
Resident Elaine Flynn disputed allegations that homeowners hadn't paid for the water.
"We paid from upwards of $150,000 to $500,000 for dirt and permits. We already paid for it," she said. "We should be treated equitably and fairly. Why should we have a separate water rates?"
In a letter to the board, Joe Flynn asked "why the county approved the Sierra Creek Estates water system without requiring the proper performance bonding to assure its proper completion?"
"SCE's residents deserve the same precedent that the county has already shown Sheridan Acres, Job's Peak Ranch and the other formerly private systems that the county later was forced to acquire. Those residents were not penalized for Douglas County's mistakes, and neither should the SCE residents. Those residents were not penalized with punitive capital investment requirements nor punitive higher water rates," he said.
Commissioner Doug Johnson said he had no intention of spreading the cost of the Sierra Creek Estates system to the rest of the taxpayers.
Commissioner Nancy McDermid, a former resident of Sierra Country Estates, recused herself from the board votes on the issue.