Eureka residents will decide in the Aug. 4 primary election if they want to sell the city’s water and sewer systems to Missouri American Water, after a 5-1 vote from the Eureka Board of Aldermen.
Ward 2 Alderwoman Carleen Murray cast the no vote.
“I’m all for it being on a ballot,” she said. “I think it’s a very important topic for our residents to have the chance to vote on.
“However, after listening to several residents, especially in Ward 2, request that it be on the November ballot, that’s why I voted no.”
Murray said residents told her they believe more people will vote in November, when the presidential election will be held, than in August.
“More people already have November in their mind,” she said.
Also, Murray said a few residents told her they hope to take a vacation in August and don’t want to miss the election.
The board chose the Aug. 4 ballot date at its May 19 meeting. Proposition S will require a simple majority to pass.
Resident Derick Pratt spoke at the meeting, asking the city to choose the Nov. 3 general election for the water/sewer vote. He said residents need more time to consider the measure.
Eureka Mayor Sean Flower, who said he favors selling the systems, said he has received numerous emails and calls advocating for the August ballot.
“If you push it to November, effectively, what that means is we’re not going to do anything with our water system until next year,” Flower said.
Flower said anyone who might be out of town in August has other options to vote. “The state has made absentee ballots, much, much easier to do, based on the coronavirus issues, and they’re actually advocating for people to vote in those methods,” he said. “So, if there’s ever been a time where it would be easy to vote outside of the normal methods, this August (is it).”
An appraisal of Eureka’s water and sewer systems has valued both systems at a combined $28 million. The appraisal valued the water system at $18 million and the sewer system at $10 million.
Missouri American Water is offering the full appraisal amount, and it plans to spend $37.2 million in capital improvements over the next five years. Because of existing debt, the city’s net cash proceeds from the deal would come to $20.7 million.
Planned capital improvements include, but are not limited to, building a main extension to connect the Eureka water distribution system to Missouri American’s St. Louis County water supply and making sure the sewer system is compliant with federal and state regulations.
“The sale of these systems will be one of the most important decisions in the history of the city,” Flower posted on Facebook.
Flower recommends selling the system for several reasons.
The sewer system must have capital improvements to stay up to code, and the city would have to raise rates prohibitively to cover the cost, he noted. He said the upgrades may cost residents less under Missouri American Water’s ownership.
Flower also said water quality would improve if the water system is sold.
Flower said the cash the city will receive could help make up for lost sales tax revenue from the last couple of months.
“I think it’d be also extremely good for the city to have the cash from the sale around and really help us stabilize city operations while this (sales tax revenue) is going up or down,” he said.
Also, he said, the cash could be used to pay off the $7 million in city debt.
If the water system were sold, water would be supplied through Missouri American’s Wildwood plant, Flower said in a Facebook post. He said a purchase would take the city wells offline and give Missouri American Water responsibility for major upgrades.
According to the offer letter, if voters approve the sale in August, the water system would switch to its new supply in mid- to late-2022. An average water user’s bill would be about $78 a month, compared to the current $62 average monthly charge.
Appraisers included Edward W. Dinan of Dinan Real Estate Advisors Inc; Joseph E. Batis of Edward J. Batis & Associates; and Elizabeth Goodman Schneider of Goodman Appraisal Consult.
The Eureka Board of Aldermen voted 4-2 on Aug. 6, 2019, to enter into an agreement with Missouri American Water to get an appraisal of the systems.