Thursday, October 28, 2021

New Committee Will Review Utility

Photos by Steve Stefanides | Inside the building that houses the new membrane system for the filtrating of drinking water

Photos by Steve Stefanides | Inside the building that houses the new membrane system for the filtrating of drinking water

By Steve “Stef” Stefanides

The City of Marco Island Utility Department has been a focus of much debate and discussion over the years, as councils from the past have debated its future. Those same challenges still exist and now a new council has decided to take a look at the future of the utility.

Council Chairman Larry Honig minced no words when he laid the blame on politics, saying “A number of us have tried to float creative solutions, but we continue to run into just plain old politics.” Honig uses that claim to back up his desire to see a five-member committee created, rather than have all seven elected councilors appoint a member to an advisory committee to look at the functioning of the department.

Councilor Batte found the proposal to be flawed, and preferred to see each councilor appoint a member to insure all viewpoints and philosophies would be given consideration. “I fear what you’re doing here is creating a precedent. Let’s face it, the four of you think very similar.” Batte was referring to the slate of four, which includes Chairman Honig, Vice Chairman Grifoni, and Councilors Roman and Reed, who recently won the election in November.

The Utility Department has been a source of angst amongst residents since its acquisition from Florida Water Services shortly after incorporation as a city. The controversial STRP project and full extent of the poor condition of the infrastructure for water and sewer that was discovered after the purchase, all led to high borrowing costs that have pushed up utility rates to some of the highest in Florida.

The issue of the rate structure has divided various user groups over the years, such as commercial, condo and single family homeowners. The city has spent almost $200,000 on consultants, and has either dismissed or failed to act on their recommendations. The closest they came was in the fall of 2015, when they chose not to move forward on establishing a lower fixed gallon base charge for all users and then a fixed cost per/gallon for each gallon utilized. There would be no distinguishing between any owner groups, but ra___ther everyone would be treated equally regarding usage.

This newly proposed committee would not venture into the quagmire of rates, but instead, only discuss debt alternatives, capital cost, outsourcing, partnering with the county or another entity. In addition they would look at the possible sale of the utility to another entity. They would also be looking at treatment options and possible alternate sources of water.

A major obstacle lies in how the bonding to purchase the utility was structured initially, and may impact the ability to sell the utility and limit the committee’s options.

Over the last three years, former City Manager Roger Hernstadt began the first early repayment of bonds when those options became available. The former council had also taken advantage of much lower interest rates to refinance some of those existing bonds when the opportunities were available, saving ratepayers large sums for interest payments.

Council voted 5-2 to establish the five-member committee over the objections of both Councilors Batte and Brown, who preferred a seven-member board to bring back recommendations. That committee would sunset on October 31, 2019. Council will consider who to place on that board from the ten applications they have received at the council meeting on April 17, in chambers.

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