SALINEVILLE - Councilmen Rick Beadle and Tom Hays were outspoken about their dislike of Buckeye Water District at this week's village council meeting.
The councilmen's main grievance is that the district is using the former village water treatment plant property to sell water in bulk without council's permission.
According to Buckeye Water District Manager Al DeAngelis, earlier this year the Columbiana County Port Authority brokered a deal between the water district and R.E. Gas Development LLC, a subsidiary of REX Energy. Following a series of negotiations, water district officials agreed to sell Rex Energy water for $6.60 per 1,000 gallons. DeAngelis noted that sixty cents of each $6.60 will go to the port authority, which he says made the deal possible. DeAngelis said Buckeye expects to supply Rex Energy with about 30 million gallons per year.
As part of an effort to transmit water to water impoundments in Carrol County, Ohio R.E. Gas Development has been buying up private easements and laying down water transmission pipes to carry water from existing Buckeye lines.
The former Salineville water treatment plant west of the village on state Route 39 lies along the path of these transmission lines. DeAngelis explained that R.E. Gas Development approached the village about signing $60,000 lease for the land so that the water pipes could pass through. However, Ohio Revised Code required the village go through a bidding process. So in order to avoid the bidding process, the village allowed Buckeye to act as an intermediary, leasing the land on behalf of the village. Buckeye is not a government entity and does not have to accept bids for projects like the village, according to DeAngelis.
At Monday's village council meeting, both Hays and Beadle took issue with what they viewed as Buckeye using the former water plant property on the grounds of a 2007 management agreement between the village and the district.
The management agreement was signed in 2007 by a previous village administration when Buckeye began managing the village's water system. Beadle argued that the terms of the management agreement did not give Buckeye the right to use the property to sell bulk water.
"They feel our managerial agreement allowed them to supply water to any other customer and it didn't matter what they do to any of our (village) property," said Beadle, noting that he felt the village council was not given a say in the matter.
Mayor Mary Smith disagreed with Beadle saying that at a meeting on Nov. 25, Buckeye representatives had presented council members with an addendum to the 2007 management agreement.
Smith said council was given the option of declining or accepting the addendum. Declining the addendum would mean that Buckeye would bypass the village owned property and continue laying water pipes elsewhere nearby. It would also mean that the village would miss out on $60,000 Buckeye plans on giving the village for use of its property.
Beadle also argued that the water plant had been decomissioned as part of the village water system and therefore did not fall into the category of utility-related property described in the management agreement.
"That reservoir and that land up there does not belong to the public utility any longer," said Beadle. "When that property was decomissioned it became the residents of Salineville's property and has nothing to do with the utility company."
A copy of the "Addendum to Management Agreement" document was provided to the media at Monday's meeting. It reads: "Buckeye is authorized to utilize said property pursuant to the Management Agreement and this Addendum for purposes of constructing such water line extensions as may be necessary to provide water service including bulk sales."
When contacted after Monday's meeting, DeAngelis confirmed that the management agreement allows for Buckeye to use the property. He stated that Salineville's village solicitor, Andy Beech, and Buckeye's attorney, Fred Emmerling, are in agreement that terms of management agreement allow for them to use the property.
When asked at Monday's meeting if the management agreement did in fact allow for Buckeye to use the property, Beech explained that the agreement gives Buckeye the right to use village "assets" as part of the operation of the village water system.
"We could have said, 'Go ahead and do this and don't worry about the village,' but the board felt if the village could stand to make a little money off this through the lease, why not make that possible for them," said DeAngelis after Monday's meeting.
Smith asked Hays why he had not raised his concerns to DeAngelis when he presented council with the addendum at a meeting between Buckeye and council members on Nov. 25.
"Why when Al (DeAngelis) left the other day and he asked you if you were good with this you said it was fine?" asked Smith.
"He asked me if I was good with the meeting and I said 'yes,'" responded Hays.
"No, he asked if you were good with this," responded Smith, waving the addendum. "His words were, 'Are you good to go with this addendum?' I stood right there."
After Monday's meeting, DeAngelis confirmed that he had asked Hays directly if he found the addendum agreeable and that Hays had said 'yes.'
"When I was leaving (Nov. 25 meeting) I wanted to make sure that everyone was comfortable with what we had discussed and I said to Tom (Hays), 'Tom, are we good with this agreement, are we good to go?', and he looked at me and said 'yes'," said DeAngelis noting that several people witnessed the event.
Council will have a special meeting with Buckeye representatives Monday at 6:15 p.m. to review the terms of the addendum.