Should we spend $2M on water meters?

At their August meeting, our board of commissioners discussed a proposal to purchase and install 1,352 “smart” water meters and other hardware, such as radio transmitters, needed to make them function. The topic was listed on the meeting agenda as “AMI Metering”.

Prior to the regular third Tuesday meeting, a special meeting was called to present the subject to the board members. I was unable to attend that particular meeting, but the commissioner in charge of the camera didn’t feel that spending two million dollars of our money was important enough to you and me to bother streaming or recording that special meeting. That makes it harder for all of us to have any say in what gets discussed in those meetings.

A company called USG Water Solutions wants to sell us 1,352 “AMI” water meters. AMI stands for advanced metering infrastructure. You can read more about that technology by clicking here.

All of this cool new technology can be ours for the low, low price of 2.2 million dollars ($1,694,022.50 principle, borrowed at 4.952%, repaid over ten installments of $224,412. 28, equals $2,244,122.80). By now I’m sure the interest rate has probably changed, but you get the picture; $2.2 million dollars, all or nothing.

A representative from USG Water spoke to the commissioners on August 15th, and I hope you’ll watch that segment of the meeting by clicking this link. It’s a little hard to follow at times because every time any commissioner shuffles some papers, opens a water bottle, or unwraps a piece of candy the noise makes it very difficult to understand speakers.

Anyway, for a ten-year commitment to repay more than 2.2 million dollars, we’re going to be just rolling in money from the recaptured water revenue that USG assures us will follow. Here’s a link to the relevant documents, provided to the commissioners before the meeting.

The selling point according to statements made by Mr. Helton and/or Mr. Cauthern, the USG representative, is that roughly 33% of the treated water leaving our treatment plant disappears between there and the customer’s water meter. The town loses out on all that revenue, not to mention the wasted chemicals used to treat it, and I agree, that’s an unacceptable loss, but I’m not convinced it justifies replacing all 1,352 meters on our distribution system at once.

We’ve been dumping treated water from the end of the line down NC-22, south of Faith Christian School, for decades. This is done because there’s not enough usage on that end of the system to keep the water in the pipeline from going stale, a problem that should have been addressed years ago by building a return loop, but that’s an issue for another time. The fact remains: we’re wasting about one million gallons of treated water out of the end of that pipe each year. I wonder if anyone has ever placed a meter on the end of that pipeline and actually measured how much clean, treated water we’re losing down there every year?

At one point during the August 15th discussion, Mr. Helton stated that most of the lost revenue from unbillable “ghost leaks” (my term, not his) is associated with one-inch diameter commercial services. Those account for less than ten percent of the 1,352 meters on the system, approximately 120 according to Mr. Helton’s statement to the board.

Got that? They’re saying we should spend a couple of million dollars replacing everything all at once, to fix a problem that primarily affects less than ten percent of the system. Do I have that right? Watch the video.

After more than a decade of running my own business, I’ve learned to be a little bit skeptical of figures and claims made by sales representatives, and often those were expensive lessons I’d rather not repeat. Being on the hook for expensive equipment that doesn’t deliver is no fun, but if I make a bad decision for my business, only my family and I bear that cost. If this AMI system fails to live up to expectations or starts failing before the loan is paid off, you and I and every other water customer in Ramseur will all be paying for it long after those responsible have left office or moved away.

This is why I had hoped the commissioners would do the right thing and allow me to participate in these and other important decisions between now and December; decisions which may impact our ability to move forward on other critical issues.

Had I been allowed to participate in that discussion I would have asked the USG representative to work up an alternate proposal to replace only the one-inch meters, since according to Mr. Helton, they are the biggest part of the problem. Call it a pilot program if that helps.

If the technology proves to work as advertised and really does save us as much money as is promised, then we might consider buying more meters later. Given the numbers I heard in that meeting, it seems to me that the captured revenue from such a pilot program could easily be reinvested in replacing more meters in a few years. Right now, given the shape we’re in, I can’t see signing off on a ten-year, seven-figure debt without more concrete proof.

What really blew my mind during the meeting was the fact that no one had run this idea past the LGC (Local Government Commission). As I understand it, the LGC has to be consulted before this deal can be sealed because our town has been so far behind on mandatory budget audits. We have to get permission from the LGC to borrow this much money. No one in the office or on the board contacted the LGC before this was presented.

At least two commissioners apparently had every intention of holding a vote and closing the deal that night. That’s bad governance and makes us all look stupid. Watch the video. Commissioner Parrish was ready to spend two million dollars of your money on technology that may or may not live up to expectations. Pushing through big spending deals and making unnecessary changes to how our government works is not the way a town in the shape we’re in should operate.

Water treatment chemical prices continue to skyrocket. Remember that pipe I mentioned south of town? Hundreds of gallons of treated water flow out of that pipe, wasting water, chemicals, and money all day, every day. The AMI system may indeed be able to save us money over the long term but, replacing all of our meters at this time just seems like just more reckless spending to me.

Thankfully the AMI discussion was tabled last month, but if past experience is any indication it will be brought back up again at the September 19 meeting, where it will probably come to a vote, and this board rarely fails to pass anything that comes to a vote.

I’d like to see a few other options on the table before anyone commits us to spending money we might not even have. I’d like to see a few more of you, my neighbors, in that room on meeting nights. I’m guilty too. It’s no fun sitting in that room, biting your tongue, but it’s up to all of us to let those commissioners know that we are paying attention.

You can sign up to make a comment to the board on the night of the meeting. Please, show up and let them know what you think.