McLendon-Chisholm City Council approved a resolution agreement for the City to accept all assets and customers of the RCH Water Supply Corporation. Will Mr. Jackie Pullen, RCH WS Board President post the Asset Transfer Agreement at the October 5, 2022 RCH WS Board Meeting for discussion and action?
To my knowledge, Mr. Pullen received a phone call from the McLendon-Chisholm City Administrator Konrad Hildebrandt to inform him of the decision made at the City Council Meeting and emailed him the agreement.
It would be an honorable action for the RCH Board of Directors to begin the process of dissolving the corporation by taking a vote in favor of the transfer agreement to the City of McLendon-Chisholm. (Review RCH WS Bylaws ARTICLE XXIV)
Considering there are:
• looming costs of $500K to pay an engineer upfront for design plans to relocate water lines for the TxDOT 205 Expansion project;
• incomplete pursuit to become a NTMWD customer;
• financial costs for the Terrell NTMWD take point;
• incomplete land acquisition process;
• estimates of $14 million in infrastructure improvements for an additional elevated water tower;
And then there is the issue of the infamous administrator officer Robin Baley of H20 Services who has failed to comply to the Texas Open Meetings Act and still continues to “manage” the operation. It certainly can make anyone’s head spin as to how far this water supply corporation needs to get out of their hole to be compliant and to be a qualified CCN.
What is a CCN?
A Certificate of Convenience and Necessity (CCN) grants a CCN holder the exclusive right to provide retail water or sewer utility service to an identified geographic area. Chapter 13 of the Texas Water Code requires a CCN holder to provide continuous and adequate service to the area within its CCN boundary. Municipalities and districts are not required to have a CCN to serve in areas that are not already being lawfully served by another retail public utility; however, some municipalities and districts choose to obtain a CCN to protect their service area from encroachment. A district may not provide retail water or sewer service within the CCN service area of a retail public utility or within the boundaries of another district without the retail public utility’s or district’s consent, unless the district has a CCN to provide retail water or sewer utility service to that area. Similarly, a municipality may not provide retail water or sewer service within the CCN service area of a retail public utility unless the municipality has a CCN to provide retail water or sewer utility service to that area.
We are at an extreme Critical Stage for MANDATORY CHANGES
RCH WS can not continue to operate as they have been for a number of years. There are over 2,500 customers and approximately 4,200 in population–there is no more hiding the obvious problems behind closed doors. All RCH WS customers should be encouraged that the City has taken the initial step of approving this resolution.
If Mr. Pullen is serious about doing what’s best for our community he will take the agreement as an action item at the next RCH Board of Directors meeting. Once the agreement is approved for Mr. Pullen to sign and deliver to the City of McLendon-Chisholm, a process will begin to keep things orderly and on the record as noted in the agreement. There will be some minor administration items that Mr. Pullen may need to be physically present as the McLendon-Chisholm City Administrator gathers all of the necessary documents including the customer log, equipment keys and financials.
How will the City demonstrate that they can meet the requirements and capabilities to provide a water supply service?
From my point of view, there are a few hurdles that will need to be managed and can be accomplished with inter-local agreements.
1. Billing and Operations
As part of the application process, the City will most likely pursue an inter-local agreement with a qualified CCN nearby [View Figure 1] that has the billing staff, operators and field techs to manage the day-to-day operations. Of course, there will need to be a clause that includes an understanding that the City will have their own utility department that will eventually manage billing and operations in the future. This would be extremely cost efficient for our city budget.
2. TxDOT Road Expansion
The City Administrator will need to work with the TxDOT Relocation Coordinator Walter Caraig to address the water line issue so that an engineer will be able to produce those plans in a timely manner. The discussion for the costs of funding of the water line relocation will need to be addressed and hopefully the remaining of the RCH WS reserves can be used. At the September RCH Board Meeting it was speculated that the cost would be approximately $4 million and the speculation is that $4 million is what they may have in reserves. We will know more as soon as the City Administrator is able to have access to the financial records.
3. Funding Infrastructure Improvements
To accommodate the current growth and to have adequate water pressure customers may have to accept the reality that necessary improvements will be needed. The cost is a considerable amount of money and can be accomplished with good planning. However, before that can be pursued the City would need to address the NTMWD takepoint in Terrell. Once the administration process is filed officially with regulatory agencies the financial opportunities will open that will be significantly helpful for our region that would not have been available with the current status of RCH WS as is.
While we wait for the RCH WS Board Meeting Announcement…
In the mean time, I would recommend sending emails or phone calls to the McLendon-Chisholm City Council to let them know your support of this undertaking.
From what I have heard and read in other water supply corporation battles with customers, state audit reports, decertification CCN cases and/or corporation dissolution, it can get quite muddy, ugly and take many years to get resolved. We are fortunate to resolve these issues locally instead of waiting around for a three letter agency to do an investigation.
None of this process could have been done without the help of those reading my blog, citizens coming to the City Council meetings, customers showing up to the RCH WS board meetings and several elected officials that have stepped up to do what they can do because customers want better water management. The RCH WS Board Directors heard what the people are saying and are probably contemplating how to close with dignity.
Heath City Council’s Political Stunt
For months there was rumors that the City of Heath has filed a lawsuit against the City of McLendon-Chisholm. Since April 12, 2022 consistently the Heath City Council began discussing “contemplating litigation” against the City of McLendon-Chisholm in executive session. The petition was filed on September 13, 2022. It will certainly be interesting to see how the case will be presented in court.
Heath City Council conducted multiple Executive Sessions contemplating litigation or settlement offer
McLendon-Chisholm City Attorney Michael B. Halla provided a brief update to the McLendon-Chisholm City Council regarding court filing 1-22-1204, “At first glance this is a political stunt by the Mayor of Heath (Kelson Elam) who thinks that Rockwall County is his sanctum and his city attorneys are their lackeys, as well as, the Heath City Council is part of it. From a legal stand point, they have some issues that they are not going to be able to overcome. One of the lap dogs suggested that he thinks he can ask a judge to order a legislative body to pass or not pass a law regarding the Comprehensive Plan. They are seeking to request of the Court to order to invalidate the zoning ordinance with the 2015/2016 McLendon-Chisholm Comprehensive Plan as it relates to the Trilogy Development inside the city limits. They are claiming that it violates the comp plan and zoning ordinance. They are also claiming that the comp plan was not amended as it should have been. They are trying to use this as a way to invalidate the [Trilogy] development agreement.”
Also worth noting that the Building Official was up for contractor renewal and the McLendon-Chisholm City Council passed that the North East Texas Inspections to receive it’s 30 day notice of termination.
Thank you for reading to be informed and for taking part of the RCH WS WATCH. I’m definitely looking forward to the next RCH Board Meeting. Please let me know if you plan to come to the meeting and definitely say hello if we have not met yet. If you are new to my blog consider clicking yes if asked, “Would you like to receive notifications on latest updates?” Or visit the Politics category in the menu to read all my local Rockwall County political articles.
Comment below what are some of your concerns that you believe should be addressed I would love to hear your thoughts.