Meter investment not paying off

Who will pay for the $1.2 million the city borrowed to purchase more efficient electronic water meters? After more then a year, the meters aren’t gushing profits by capturing lost revenue. Back in May 2006, members of the Water and Sewer Committee were asked to consider replacing their old water meters during a presentation given by Volunteer Utility Sales, Inc. At that time, officials were told the new meters would generate enough revenue to pay for themselves in accuracy and productivity. Because of the electronic meters accuracy, city residents would be paying for all the water they use. As presented to them, the city was losing revenue with the old system because it did not register all the water used. Given the electronic capabilities of the meters, the city would save productivity. A simple walk-by or drive-by with a hand-held device is all it takes to register readings. Because of this, one employee could drive around the city and read all the meters in a few days. Once the meters are read, software figures the bills automatically. If there is tampering, leaks and back-flow problems, the meter reader is given an alert by the system. At that time, the increased revenue was projected at over $300,000 annually. With a cost of $1.2 million payable over the next four to five years, the system would be paying for itself. Although the meters received the support of the committee, the plan had a more difficult time when it came before the Board of Mayor and Aldermen a month later. At that time, Alderman Patti Nunley voted against the meters. ‘I’ve had my reservations from the start that the meters would capture enough revenue to pay for themselves,’ she said. Given that she does not sit on the Water and Sewer Committee, that was her first chance to vote on the purchase. With the majority voting against her, the measure passed and the meters were purchased and installed by the McMinnville Water Department over the next several months. A $42,391 increase in revenue was reported in June 2007 when revenue was compared to June 2006. However, that increase was isolated. According to Water and Wastewater director Carl Davis, there has been a 3 percent increase since the installation of the meters which won’t generate the revenue needed to pay the $274,000 annual payment. Because the decision to purchase the electronic meters was made after Volunteer Utility Sales presented the system as having meters that would pay for themselves in extra revenue, the city has begun negotiations with the company to refund some of the $1.2 million paid for system.