Cedaredge works out settlement with water group
By Hank Lohmeyer
Published Thursday, July 28, 2016 8:51 am
Meeting on July 21, the Cedaredge Town Board voted to inform the Upper Surface Creek Domestic Water Users Association (USC) that the town will not pursue further litigation in its water utility ownership dispute with the private domestic water provider.
In addition, the town board stated that a decision will be made on Dec. 12 regarding which of two mediation options it will choose.
USC had been a 20 percent owner of the water collection and treatment utility it shared with the town dating from a prior agreement. In 2005, USC constructed and began using its own water treatment plant. The mediation was initiated by USC to obtain compensation for its share of the town water system.
According to a presentation to trustees, the two options for settling the ownership dispute are:
• The town pays USC the sum of $175,000 no later than Dec. 31, 2016, as a buyout of all of USC's interest in the common water system;
• In the event $175,000 payment is not paid to USC by Dec. 31, the town will sell to USC and immediately lease back the north or #1 treatment plant and pay $1,000 from water enterprise revenues for 210 months (17.5 years). At the end of the 210-month lease/purchase, USC will convey the leased premises to the town.
"Both options, after full payment to USC, will transfer all common property outlined in the Dec. 13, 2000, agreement to the Town and terminate any common use or ownership. All arrangements as to details of the final split will be formalized at the time" either option becomes finalized.
Staff also reported "there is not money in the water fund" to pay for the $175,000 buyout option this year." According to a draft resolution on the option, the money would have to come from loans, budget transfers, or new water revenue bonds.
In other business at its July 21 meeting:
• Trustees were notified that the town had won a "loss prevention award" for 2015 from its common insurance carrier.
• Trustees formally accepted the town's 2015 financial audit.
• Bill Miller was presented with a certificate of appreciation for his years of service on the town planning commission.
• Trustees were told that county commissioner district #3 will fund $2,130 for lighting improvements at the town tennis courts.
• Trustees scheduled their first 2017 budget work session for Aug. 18.
• Trustees were informed that the annual Colorado Grand auto tour would make a stop in Cedaredge on Sept. 13.
• Public works reported that a salver has said he will agree to removal of the decommissioned small hydro generating unit above the water plant.
• Public works reported in an incident that restricted outflow from the new sewer treatment plant. The plant's builders were called to perform a fix by tightening bolts on an outflow pipe flange that had not been torqued to proper specifications.
• Four water line leaks, all on the town's older four-inch diameter steel lines, had been discovered and fixed in the last week.
• State dam inspectors had visited the town's Grand Mesa Reservoir sites.
• Trustees were informed of three vacancies on the town planning commission.
• The town will not participate in the November coordinated election.
• Trustees approved a Civic Center rental agreement with Volunteers of America for their senior meals program. Some operational problems with the program were discussed.