The Pueblo Chieftan

Letter: Penny wise, pound foolish

At the May 28 Pueblo West metro district board meeting, Resolution 2013-26 was adopted: A resolution confirming drinking water revolving fund loan as an option for water treatment plant and pipeline expansion projects.

What does it mean?

Simply put, to avoid spending reserve funds to do water treatment plant and pipeline expansion work costing around $6.2 million, the board is lining up to borrow the money, repayable at (anticipated) 2.5 percent interest over 20 years.

Bill Vickers is the only metro board member who voted against it.

According to the metro district’s 2013 approved budget, the district’s water enterprise will still have around $9.5 million on hand in reserve funds at the end of 2013.

Those funds are currently held in short-term deposit certificates earning on average only about .5 percent interest.

If the district borrows the $6.2 million at 2.5 percent interest, it will be unnecessarily saddling utility rate payers (homeowners) with around $8 million in principal and interest payments (increased utility rates) over the next 20 years.

What is this if not “penny wise, pound foolish?”

But it doesn’t stand alone in the annals of questionable metro board actions.

Not that long ago the metro district built that new Taj Mahal fire station at the corner of McCulloch Boulevard and Gold Drive.

Included in that project was installation of a new sewer line running southeast from the new fire station to the sewer treatment plant south of Highway 50 – sewer line cost: around $3 million.

It wasn’t necessary to build the fire station at that location.

It could have been built just a short distance south along McCulloch Boulevard, within the same fire department response parameters, on land already owned by the metro district where sewer line connection was already available.

But, as too often occurs, special interest privilege was a paramount consideration.

At least one developer was eyeing a site near the McCulloch Boulevard at Gold Drive location for a commercial development project that would require sewer line service.

But sewer line service was not yet available at that location.

There was, however, a convenient solution to that shortcoming — build the new fire station there and put in a sewer line.

That’s exactly what the metro board did.

Then the developer’s plans changed and the commercial development project evaporated.

There are homes located along that $3 million sewer line; but there have been no connections to it.

To avoid paying the required sewer line connection and service fees, a builder has only to obtain a variance form the metro board, allowing instead the installation of a septic tank.

Consequently, utility rate payers (homeowners) are saddled with paying (increased utility rates) for a $3 million sewer line that even now serves only one customer: the fire station.

How can the metro board justify borrowing money for a project when it already has sufficient money?

Apparently the same way it justifies a $3 million sewer line that barely serves the district.

Bill Clemens

Pueblo West

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