Bethel crowd unconvinced by auditor

By Jeff Whitten


The meeting of the Bethel Springs Board of Aldermen followed a similar script as past months. The audience told the board and mayor Kay Cox that they can’t afford their water bills, and the Mayor and board told them that this was not the sewer they wanted, but this is the one they have to deal with and are doing the best they can.

The unique twist to this meeting was the appearance of John Poole, the auditor of the town. Poole attempted to explain the fiscal situation of the water department to the satisfaction of the crowd, with limited success.

He gave the less than capacity crowd assembled at the Community Center a handout outlining the budgetary situation of the Bethel Springs water department.

This handout showed that for the fiscal year ending June 30, revenues were $305,387 and total operating expenses were $308,466 The handout also showed that depreciation was $102,000 and debt payments were $68,000. Poole noted that this only leaves $130,000 to operate the system. “If you only have $130,000 to operate the department, you can’t do it profitably,” he said.

When a member of the audience asked where the money from depreciation went, Poole struggled to come up with an answer that the man would accept.

Poole explained that depreciation is the fall in value of an asset. This is deducted from the balance sheet of the department. An equal amount of money from revenues has to be charged for maintenance and to replace the asset when it wears out.

He noted that most systems don’t do this because they would run big surpluses, and this would cause people to be upset about having to pay higher prices than they would normally in order to create the surpluses.

The value of the assets of the department fell $57,818 in fiscal year 2011, which ended June 30 and $118, 382 in fiscal year 2010. He said he anticipates that the department will run about a $30,000 surplus next year.

Poole said, as the Mayor had in past meetings, that if the department’s liabilities were greater than its assets for two straight years, it would have to go to the state Water and Wastewater Board. The city would then have to get approval of a plan to bring its budget in balance or the board would do it for them.

He said that if the board has to raise rates, they will be twice as high. “You would have got robbed if the state did it. They don’t want to see the same folks year after year,” he said.

Cox added that the state recommended that the town raise water rates. “When the state recommends that you raise rates, you have to do it,” she said.

Poole said the state would probably not make the town raise sewer rates year after year but probably would have to raise them enough to compensate for inflation.

One member asked why the town doesn’t include 2,500 gallons in the base rate anymore, but starts charging customers from the first gallon. Mayor Kay Cox replied that she didn’t know. She said that the Municipal Technical Assistance Service gave the town the rate structure and said she would give their number to anyone who wished to call them.

City Recorder Erin Pickle said that she had been told by MTAS that they don’t include any water in the base rate anymore. 

As she has in past meetings, Cox said of the sewer, “I don’t like it any better than you. It is what it is.”

The Mayor then explained that they had to put a sewer in because sewage was running in the ditches, and the state would have made them do it. “This is not the sewer we were going to put in,” she said.

In answer to another question, Cox said if the sewer runs past someone’s house, under state law, they must hook up to it.

Cox once again outlined the steps her administration has taken to deal with the issue. She said that she, Pickle and City Clerk Deborah Sullivan met with Rep. Marsha Blackburn and she said she couldn’t help them.

Cox also told the crowd that she had asked the U.S. Department of Agriculture to forgive an $800,000 loan and they refused.

Cox responded to complaints that some people refused the sewer service or refused to pay for it by saying that anyone who was legally required to have the service would be referred to an attorney for legal action. In response to complaints that some people in the city limits were not required to hook to the sewer, Cox said the prior administration had left people in the north end of town off the sewer in order to save money.

Sullivan said that there were 340 households in the city limits but only 289 were hooked up to sewer.

Vice-Mayor Bob Graham, the only board member present, who was also in office when the sewer was approved, noted that he voted against it.

Cox said that she had put the sewer up for bid and after they obtained the $800,000 started the engineering process. The low bid was $3 million and the average rate would be $40 per month. Cox then left office and said it was her understanding that the subsequent board decided to start over on the sewer. She said that either bankruptcy or giving up the town’s charter are not options because the sewer would have to be paid for by Bethel residents one way or another.

One audience member said, “You’re not going to have any people here in a year or two.” Another audience member spoke up for the board saying, based upon his research, Bethel has average water bills. Others said Selmer’s sewer and water service is a lot cheaper.

On another topic, Cox said, “Our town is a mess. We haven’t had any maintenance in four years. We need another employee.” Sullivan reported a 14 percent water loss and 46 percent of sewer fees collected.

In other actions, the board:

*Approved seeking state approval to buy a 2000 International dump truck. Graham noted that it has a roller on the front so it can do coal mix better. He also said that it has 100,000 miles and should last 10-15 years.