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Council may put EPCOR purchase to voters at meeting Tuesday

July 24, 2018

BULLHEAD CITY — Bullhead City Council members will consider a resolution putting the decision to purchase EPCOR Water Arizona’s city assets in front of voters in November.

Members will meet at 4:30 p.m. today in executive session prior to their regularly scheduled meeting to confer with legal council concerning potential acquisition of EPCOR Water Arizona’s Bullhead City assets. Executive sessions are not open to the public. No legal action is taken at executive sessions.

Members will reconvene in regular session beginning at 5:30 p.m. in the City Council chamber, 1255 Marina Blvd. The meeting is open to the public and broadcast live on TV4.

In open session, members will consider action to approve Resolution No. 2018R-42 calling for a vote of the electorate on Nov. 6 to authorize City Council to acquire the utility and the issuance of bonds for the purchase/acquisition.

“It’s a timing issue for right now,” said City Manager Toby Cotter. “To be on the November ballot, it has to be done now or it would have to wait for two years or would have to be a special election, which would be more money.”

The resolution does not mandate that the city move forward with the purchase or acquisition of the water utility.

“In fact, it’s pretty explicit that if approved it would give (the city) authority to move forward but does not require it, so the city would be able to make that decision down the road,” Cotter said.

Cotter said he has prepared a thorough presentation for council members.

“Not just for the council members that have to vote on the resolution, but also for the public who want to understand this issue in depth,” Cotter said. “When the public knows that they’ll be paying the same rates as the people in Paradise Valley or Anthem — and understands that we get our water from the river and it’s conveyed into a tank and then our pumps deliver it into their homes here in Bullhead City — but we’re going to pay the same amount as those people living in Anthem and Fountain Hills and Scottsdale and Paradise Valley, (who get) the same water from the river, conveyed and taxed and with a different power source that is much higher (in cost).”

Should council vote to approve the resolution, Proposition 410 on the November ballot would give voters the option to either vote for the acquisition and bonds or against the acquisition and bonds. The issuance and sale of bonds would be payable from rates charged for service to the public in a principal amount not to exceed $200 million, with such bonds or series of bonds to mature not more than 30 years from their issue date, with interest rates not to exceed 7 percent per year.

Arizona Corporation Commission, which regulates utilities, ordered EPCOR Water Arizona, Inc. to submit a rate case considering each of its 11 Arizona districts individually as well as a plan that would consolidate its Arizona water systems into one rate across its districts. The proposed consolidation, which EPCOR is recommending, would raise rates for the average city residential customer from $28 to $42 per 7,000 gallons of water used.

The value of the water company has not yet been determined, but EPCOR has estimated the value of the local system at $130 million plus legal fees. The city believes the utility’s Bullhead City assets are worth significantly less, Cotter said.

ACC hearings on the EPCOR rate case began last week. A ruling on the rate case is expected this fall.

In other business, council members will discuss and possibly take action to approve Resolution No. 2018R-43, supporting the Arizona Department of Transportation’s application to assume environmental review responsibility from the Federal Highway Administration for federally funded highway projects in Arizona and for local public agency projects that are not part of the state highway system.

Members will host a public hearing and possbily take action to approve an application for an interim permit and new Series 12 liquor license submitted by Jose DeJesus Valdez for Agave’s Mexican Grill, 865 Hancock Road, and discuss and possibly take action to approve the final plat for The Ridge at Fox Creek Track 5147, Unit 3, the financial assurance through the property escrow agreement and the water allocation in the amount of 3.7 acre-feet.

Members also will consider approving expenses incurred from the disposal of sludge to the Mohave County Landfill in an amount not to exceed $160,000 for fiscal year 2018-19.

Council members will accept a $50,000 check on behalf of the city from American Youth Soccer Organization for soccer field lighting at Rotary Park, 2315 Balboa Drive.

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