For more than a year, WMU had been embroiled in several financial challenges that threaten to burden the company for decades, including a downturn in industrial revenue, a $35 million consent decree with the U.S Environmental Protection Agency and a growing demand on water treatment.
Meanwhile, the company, which is regulated by the city commission and the state Public Service Commission, has not implemented a rate increase since 1999.
WMU general manager Vernon Azevedo said the request for proposals will eventually lead to a contract, which will require a discussion on funding. The company has estimated that a rate study would cost between $150,000 and $200,000.
"We do not have that in our current budget as a budgeted line item, so that is another side to this which we'll have to further discuss," Azevedo said.
However, he added that one benefit of the commission's action Thursday is that WMU can report to bond holders that the company will take positive steps with regard to its failure to meet bond coverage in the previous fiscal year.
Financial advisers have said that WMU can avoid having a black mark on its record by taking steps to correct its bond issues, Azevedo explained.
He expects a first draft of the rate study to be completed by March with the study to be ready for consideration and implementation by May or June.
Burtner said that city commissioners support conducting a study.
"I think there is a general feeling that we have to have some basis upon which to make judgments on rates," he said.
WMU Commissioner Doug Oliver was appointed to work with staff on the matter.
In other business:
- The commission gave design reapproval to water and sanitary line extensions at Aspen Place. The project includes 1,153 feet of water line and 752 feet of sewer line, which will serve 36 residential units.
- Design reapproval was given to water and sanitary sewer line extensions for Fort Estill, unit 4C and Blair Village, unit 1. The project includes 520 feet of water line and 441 feet of sewer line for 23 residential units.
- Design reapproval was given to 900 feet of water line extensions and 1,570 feet of sanitary sewer line extensions to Walgreens. It will serve five commercial units.
- The commission approved moving forward on negotiations to purchase a $130,000 wastewater treatment plant dredge from VMI, Inc. of Cushing, Okla. The equipment would replace a 10-year-old dredge, and the commission agreed that sealed bidding would be inappropriate because of the project's specifications.
- Commissioners declared an emergency to replace a vacuum/jet rodder truck and authorized purchase of a $237,000 AquaTech vacuum/jet rodder from CMI Equipment Sales, Inc., of Nashville, Tenn. The purchase will be made with funds from depreciation and sale of the current equipment to the city of Berea for $30,000.
