COUD loans $500k to fund water authority

Mar. 20—The Crab Orchard Utility District is hoping the new Cumberland Plateau Water Authority can help bring water districts together to find a long-term solution to the county's water needs.

To help the new entity get started, the Crab Orchard board approved a $500,000 loan, though the water authority has no customers at this time and no accounts receivables.

"We've got to have a water source," said Jimmy Smith, president of the Crab Orchard Utility District board of directors during its March 14 meeting. "Is it a waste of money for us? I don't know. I don't think so.

"We're not going to be able to keep doing what we're doing."

Crab Orchard added 175 customers in the past year, increasing the need for water in their service area, which includes Fairfield Glade and the area from near Peavine Rd. east to the county line, including the area under development as a motorsports park.

"If this authority don't go, we might as well do a moratorium and not have any more water customers," said Everett Bolin, Crab Orchard general manager. "We've got to think of it as doing this for the citizens of Cumberland County, our kids and grandkids."

Smith said, "We've got to have more water in the next five years. This district can't do it ourselves. If it takes taking on the water authority — I feel that's our purpose, to protect our people."

Crab Orchard Utility District has explored various potential sources for additional drinking water, from water harvesting to creation of a new water supply lake. But they've not been able to gain permits for any new projects. Regulators have repeatedly pointed toward the need for a regional water supply solution.

The city of Crossville is also seeking more water. For several years, the city has been working toward a permit application to raise Meadow Park Lake dam 20 feet. City studies have projected raising the lake could provide storage for raw water to meet the county's drinking water needs until 2067.

Only Crab Orchard and Crossville have water supply lakes and water treatment plants.

Other water utility districts in the county, South Cumberland Utility District and West Cumberland Utility District, rely on other districts to purchase water for their customers.

The water authority was approved last year to give utility districts in the county an opportunity to pool resources to seek a regional solution to water supply needs.

It includes representatives of various utility districts appointed by both the county and city. The board began meeting in January, but the entity has no assets at this time.

Cumberland County Mayor Allen Foster, during the initial January meeting, explained the water authority is created to allow utility districts to work together however they should choose — either merging together into one new water entity, pooling resources for a new water supply project or keeping everything as is.

It's all the choice of the utility districts, Foster said.

Bolin told his board the authority would need funds to get started setting up a presence, establishing policies and eventually finding an office and hiring staff to apply for permits and grants.

Crab Orchard Utility District attorney Randy York said a number of documents are required before the water authority can get started on a regional water supply plan.

"I think we're looking at six months to a year to get their feet under them, hire a manager and set some goals," York said.

Smith asked, "How much more?" He added he wasn't sure $500,000 would be sufficient to operate the water authority for many years, and he asked if other utility districts had expressed interest in joining the water authority.

"I don't know if just Crab Orchard can do this," Smith said.

Smith said he is confident the utility district had enough funding to help get the ball rolling. He moved to adopt the resolution, adding, "Let's see if they can get off the ground."

The Crab Orchard board unanimously approved the resolution to loan the water authority $500,000, to be repaid in 10 years, to assist with start-up costs. The newly formed board of the water authority approved the resolution when it met March 6. The loan is subject to approval by the Tennessee Comptroller, who is charged with tracking the debt of utility districts.

York explained the loan is a "demand note" at 2% interest.

"In the event the water authority acquires Crab Orchard [Utility District], then it will be the holder of the note and I assume it will cease to exist at that time," York told the COUD board during its March 14 meeting.

The water authority is currently interviewing banks and attorneys to establish accounts and secure legal counsel.

The water authority board is set to meet 6 p.m. April 3 at Cumberland Medical Center. Meetings are open to the public.

Heather Mullinix is editor of the Crossville Chronicle. She covers schools and education in Cumberland County. She may be reached at hmullinix@crossville-chronicle.com.