Move to sell Sheridan Acres Water Co. is deemed premature
When he called officials to ask if Douglas County was interested in buying the Sheridan Acres Water Co., SAWCO president Russ Hearold, whose wife, Eva, owns troubled Foothill-area utility, said he didn’t know he wasn’t allowed to be involved.
It was Hearold’s move which got the item on the county commissioners’ Thursday agenda.
But it was also a move which the water company’s court-appointed receiver, Tim Holt of Pleasant Valley, sympathetically chided as premature.
Holt was appointed May 30, 1996 by District Court Judge Michael Gibbons to operate the then insolvent utility after the Douglas County Board of Commissioners had taken action not to become involved.
The SAWCO had been ordered into receivership by the Nevada Public Utilities Commission when it determined the Hearolds’ management had depleted its assets to a point that needed repairs and improvements to the system were beyond its means.
Holt’s charge was to manage the company in such as way as to protect both its owners and its customers.
Hearold had previously offered SAWCO to the county for $250,000. At that time, county staff members had determined that the company’s liabilities outweighed its assets. They also said that getting an appraisal of SAWCO would be very difficult.
Thursday, Commission Chairman Jacques Etchegoyhen said it was his gut instinct that the company still had no value whatever.
n $1 is too much. “Anything over a buck’s too much (to pay for it),” Etchegoyhen said.
Rendering the discussion moot, Holt told commissioners the court, which placed SAWCO in receivership, specifically prohibited SAWCO’s owners, employees or agents from being involved in any of the company’s fiduciary functions – including its sale.
At that point, Etchegoyhen ruled the meeting’s discussions on any potential SAWCO purchase over.
Sheridan Acres residents Tim Goldsmith, Dorothy Uebele, Nolan Shapiro and several more of the water company’s 92 billed customers had been on hand to urge county commissioners to take it over. During public comment on the item, Goldsmith, Uebele and Shapiro took the floor in turn.
Goldsmith, an engineer at Bently Nevada, reminded officials the county had commissioned two studies which recommended tying SAWCO into neighboring Job’s Peak or Sierra Country Estates water systems.
“They say there’s no money available to begin regionalizing the water system. Taking over the title of Sierra Estates water system wouldn’t cost anything and it would be a start toward regionalization,” Goldsmith said. “There is a responsibility here to correct the mistakes of the past. Leaving the system’s plumbing problems unsolved while we wait to see what happens is costly. It costs more to wait.”
Uebele, who lives on Bollen Circle, said a recent survey of the water company’s customers conducted by Holt concluded a high percentage were willing to pay a surcharge to guarantee a safe, stable water supply.
Uebele said Holt has operated the system in such a manner that it provides residents with water and has retained enough cash in the system to do repairs and begin paying off its debt.
n Not a liability. “The system wouldn’t be a liability to the county under proper management,” Uebele said.
Shapiro supported Goldsmith and Uebele and suggested the county use its condemnation powers to take over SAWCO.
Commissioners told residents who had come hoping for help from the county that the county was locked out of the process until the Holt brought it to them.
“We can’t break the lower court order because we feel compelled to do so,” said Commissioner Kelly Kite.
The commission elected to take no action except to direct county staff to work with the receiver.
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