Water territory bill heard: House committee considers bill offering guidelines related to water disputes

Talk about it

Disputes between rural water districts and municipalities may get state guidelines from a bill considered by a House committee Thursday. The bill drew support from some North Dakota cities but was panned by representatives of rural water districts.

The House Energy and Natural Resources Committee met to consider House Bill 1440, which was introduced by Rep. Curtiss Kreun, R-Grand Forks, and would also establish criteria for considering future state grants to water districts.

Kreun offered a number of amendments to the bill Thursday which were not acted upon. The amendments defined the process for determining costs of transferring territory and included arbitration if the sides could not agree on a contract.

“The document would only come into play if negotiations fail,” Kreun said. “The bill is designed as a process if it can’t be settled any way else.”

The bill, if passed, could come into play in the dispute between the city of Jamestown and Stutsman Rural Water District. That dispute involves territory around Jamestown including the Titan Machinery building currently under construction.

Stutsman Rural Water District and the city of Jamestown had made contracts where Rural Water surrendered territory to Jamestown. The validity of those contracts was challenged by Rural Water recently resulting in questions regarding which entity would provide water to the area around Jamestown Regional Medical Center.

“Many cities and rural waters (districts) have been working things out and many that aren’t,” Kreun said. “We don’t want to see a lot of money wasted on litigation. We’d rather see the money go to projects.”

Some city leaders supported the bill.

“This strikes a balance between small cities and rural waters,” said Ryan Ackerman, speaking on behalf of the city of Burlington. “It needs to be interpreted from the city’s perspective in that the boundaries (of a city) change.”

Jason Strand, Surrey city councilman, also spoke in support of the bill.

“Historically, the state has always given benefit to the rural waters for providing drinking water to the rural residents,” he said. “With the state expanding there are more conflicts and a need to give the cities some assistance.”

Jamestown Mayor Katie Andersen, who did not attend the hearing, said she was unsure of her position on the bill as it stood Thursday afternoon.

Rep. Todd Porter, R-Mandan, chairman of the House Energy and Natural Resources Committee, said the state was also interested in providing efficient service.

“We don’t like duplication of service,” he said. “We don’t want to see water lines crossing each other that have been paid for by the taxpayers.”

Representatives of the rural water industry spoke in opposition of the bill.

“Rural water (districts) have to blend densely populated areas with sparsely populated regions,” said Eric Volk, executive director of the North Dakota Rural Water Systems Association. “When we talk about annexing, rural water would be the first to say they don’t want to inhibit growth. In many cases, rural water has pulled back as cities have grown but are now reaching the point they have to look at this and see if it is a burden to their customers.”

Volk also said rural water districts in North Dakota are capable of reaching agreements with cities.

“Keep it local without a lot of strings attached and both can be winners,” he said.

Geneva Kaiser, manager of Stutsman Rural Water District, said part of the issue involved cities selecting prime territory as their own while leaving less desirable areas to rural water districts.

“Cherry picking,” she said. “The city of Jamestown annexed two miles of road to serve Cavendish, which was in Rural Water territory. We would make $3,000 per day if that remained in our territory.”

Kaiser said HB 1440 would give the city the right to annex a greater territory and provide water.

“If they annex 6 miles farther they gain the Spiritwood Industrial Park, which is 2 miles from our water plant,” she said. “The city allows Rural Water to serve several areas in Jamestown that are too costly for them but they are willing to spend $1 million to get water to Titan because it has the potential for more development.”

Kaiser said the bill as written could allow Jamestown to possibly claim the 300 customers it has within 2 miles of Jamestown. The bill would require the city to pay Rural Water about $900,000 as the share of the debt Rural Water has with the federal government.

“Over the 40-year term of the loans those customers would pay $9.3 million at the current water rates,” Kaiser said. “Those customers closest to Jamestown are the most economical to serve. By losing the most economical the costs would be raised to those further out.”

Theresa Sundsbak, North Prairie Rural Water manager, equated the ability of a city to annex and take over the water service to a growing area to Montana being able to annex Williams County from North Dakota.

“This bill is very poor law,” she said. “It pits rural waters against cities. The cities need to respect our boundaries as we respect theirs.”

The committee took no immediate action on the bill.

Sun reporter Keith Norman can be reached at 701-952-8452 or by email at knorman@jamestownsun.com

Tags: local news, news, water