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Pioneer ‘marking up’ water for pump station, official says -

Pioneer ‘marking up’ water for pump station, official says

Posted on March 14, 2017

By Steven Bradley

The Journal

SENECA — Oconee County footed a water bill of more than $2,300 this month from the Pioneer Rural Water District to maintain a minimum flow through its pump station at the Golden Corner Commerce Park near Fair Play.


According to figures obtained through an open records request by The Journal, Seneca Light and Water was billed $2,310.30 for 458,000 gallons of water — or more than $5 per thousand gallons — used at the GCCP pump station from Jan. 5 to Feb. 6.

Oconee has an arrangement with the city of Seneca to help with the operation and maintenance of the sewer line and pump station, and in an effort to keep the city’s expense neutral, the county agreed to reimburse it for any expenses associated with maintaining the line.

County administrator Scott Moulder admitted Monday he was a bit taken aback by the bill — more than double the per-thousand-gallon cost Pioneer pays for water from the city of Westminster and more than triple its cost from Seneca.

“It was just odd to see how much Pioneer was marking the water up after they buy it from Seneca,” he told The Journal.

Pioneer buys about 60 percent of its water from Seneca and 40 percent from the city of Westminster.

Seneca utilities director Bob Faires has said the city charges Pioneer $4,609.41 as a monthly connection fee, plus $1.33 per thousand gallons. Pioneer’s water usage is “roughly between 900,000 and 1 million gallons a day” from the city, he said. That would equate to a total per-thousand-gallon rate of approximately $1.50.

Westminster’s rate to Pioneer, meanwhile, is a $350 base charge and $2.34 per thousand gallons of water sold, according to city administrator Chris Carter.

Pioneer was billed by Westminster for 220,494,019 gallons of water in 2016 for a total of $523,674.94 — or a total per-thousand-gallons cost of approximately $2.38.

Because the GCCP pump station is in Pioneer’s service territory, any water used is billed by and paid to Pioneer — which in turn has been purchased from the cities.

“Since the city of Seneca is operating and maintaining the pump station, the water bill is in their name,” Moulder said, noting the county then reimburses the city for the water bill.

But since there are no tenants in the park, the $2,300 bill is simply for maintaining the minimum amount of water in the lines for the pump station to be operational.

Established by the state legislature in 1965 and serving about 7,000 customers in Anderson and southern Oconee counties, Pioneer adopted a resolution in January authorizing construction of a water plant adjacent to the GCCP in anticipation of a $19.4 million waterworks revenue bond.

Chuck Joye of the engineering firm Design South told the Pioneer board in November 2014 that the cost/benefit analysis for a treatment plant “gets more attractive as we go further out in time.”

The Journal reported last month that Pioneer general manager Terry Pruitt said that the district has “one rate for everybody.” Pioneer’s current water rate is $5 per 1,000 gallons, plus a flat fee of $33.80, according to a fee schedule provided by Pruitt.

That rate schedule jibes with the total the county was billed for the service dates in question. And Moulder doesn’t expect the county’s bill to be so high each month that the GCCP sits empty because the Jan. 5 through Feb. 6 bill “included a lot of testing of the well and pumps to finalize the contracts.”

But asked whether that rate seemed fair given that Pioneer had obtained the same water from Seneca and Westminster at a fraction of the price, Moulder said he was uncertain.

“Well now you are asking the $19 million question,” he said. “Nobody knows, because Pioneer hasn’t shown their financials so that it can be determined why and how they are setting their rates.”