Employees address inaccuracies in city’s condemnation case

On October 15, 2014, four employees of Mountain Water Company went before the Missoula City Council Committee of the Whole to voice their perspectives on a city ordinance that would give the mayor unlimited spending authority to pursue condemnation of Mountain Water Company’s assets.

The employees came with the hope of shedding light on factual misrepresentations made at earlier Committee of the Whole meetings by the city’s attorneys, who had been allowed to speak to the council for more than an hour during two meetings. The employees — Chief Engineer Logan McInnis, Chief Legal Counsel Ross Miller, Financial Services Manager Sara Streeter and Business Administration Manager Michelle Halley — prepared comments to conform to the city council’s three-minute limit on public comment; however, due to repeated efforts to end the comments by the mayor and council members, not all were allowed to read their complete statements. (You can watch a video of the committee meeting at this link; the comments begin at 24:47, with the first interruption coming 30 seconds later.)

Below are the complete statements of the four Mountain Water employees.

Comments from Logan McInnis
My name is Logan McInnis. I was born and raised here in Missoula, and I am proud to call Missoula my home, where my wife and I have chosen to raise our family. I am a licensed professional engineer and the Chief Engineer at Mountain Water with the responsibility of overseeing the engineering and operations of the system.

I feel it is important to dispel the misrepresentations by your attorneys of how we operate and maintain this system.

I found it astonishing that our new insulation methodology of protecting our pipes in our pump houses was described as an attempt to “pretty up” our so-called “ancient” piping. It is being done to prevent condensation from forming on the pipes during the hot summer months, because condensation causes corrosion. This rush to judgment by your attorneys was made the day before you actually spent $10,000 to completely remove and then replace the insulation in a pump house. What your experts no doubt saw under the insulation was pipe and fittings that need to be protected from corrosion. The fact that your lawyers stated our new fencing made it difficult to inspect our facilities proves the value of this fencing in protecting your water supply from tampering.

We follow strict guidelines and standards per our state and federal regulators, and we apply industry best practices to ensure our system is safe and reliable in serving this community with potable, healthy-to-drink water service and fire protection. To insinuate that we are doing anything less is not only insulting to me as a professional engineer and to our 19 certified water system operators, but it’s also unnecessarily alarming to this community.

The city has yet to provide any kind of plan as to how it would operate the system any differently regarding any of the issues that have been raised, nor how the city would pay for any of its changed directions.

On behalf of all the fine employees who help me every day to operate and maintain this community’s water system, I ask that you vote against continuing to fund the unnecessary taking of the system.

Comments from Ross Miller
My name is Ross Miller. I am the Chief Legal Officer of Mountain Water Company. Missoula has been my home for close to 30 years. As a couple, my wife and I have never lived anywhere else, and this is where we chose to raise our daughter. I am an attorney and licensed professional engineer in Montana. I have spent my entire career working in water resources. At Mountain Water, I oversee water rights, water quality, water resource planning, contracts, general legal matters, and safety and risk.

I feel it’s extremely important for this community to understand that this taking of assets will not change the fact that by Montana’s Constitution, the state of Montana and its citizens own all water within our state. Our water is not owned by private individuals or entities. Mountain’s water rights are merely the rights to put the water to the beneficial use for Missoula citizens, not the right to actually own the physical water. If public ownership of the water itself is part of the reasoning for carrying on with this litigation, you need to understand that the water is already publicly owned — by our state — and it may not be worth our public’s tax dollars to fight over its ownership.

I must also set the record straight on “significant hazard” dams such as the ones we own and maintain in the Rattlesnake Wilderness. All dams located within U.S. Forest Service lands under permit must be classified for hazard potential by the Forest Service. There are only three hazard classifications: low, significant and high. Classification is not in any way based on a dam’s condition. It is based on the environmental damage that could theoretically occur due to sudden failure of a dam. Mountain’s “significant hazard” dams were so classified due to potential environmental damage limited to the Rattlesnake’s upper-most tributaries in the event of sudden failure. No such damage would occur in Rattlesnake Creek itself, as the dams are simply too small. The Forest Service then uses these classifications to determine design standards, not to sound an alarm. We work hard every year to meet or exceed these standards, and have been commended by the Forest Service for going above and beyond what is typical for operation and maintenance of such dams. To use the term “significant hazard” to portray any of our dams as an undue risk to the environment or to the community would be wrongfully misleading. Mountain’s “significant hazard” dams will continue to be so classified regardless of who owns them.

Despite requests by Mountain’s employee group, the city has provided no information on how it would do anything differently relating to water quality, water rights, safety of the system, workplace safety for employees, or dam operation and maintenance.

I ask that you vote against continuing to pursue, at great cost to Missoula taxpayers, this unnecessary taking.

Comments from Sara Streeter:
My name is Sara Streeter. I am a certified management accountant, a certified fraud examiner and the Manager of Financial Services for Mountain Water Company. My husband and I moved to Missoula 20 years ago, and I have been proud to live in and serve this community. However, I have found it disheartening over the last year as the condemnation process has moved forward to see how unwelcoming this city’s government has become. Most recently, I was shocked by the lack of respect city officials showed Liberty Utilities when they visited Missoula for the first time a few weeks ago.

The city’s treatment of me in this process has been no better. I take great pride in the ethical and legal way we work with the Public Service Commission and the Montana Consumer Counsel. Our relationship is not cozy. It is collegial — no different from your relationship with those agencies. The city’s attack on our dealings with the PSC is absolutely false, and is clearly being done to undermine the trust the community should have in the regulators and the process of utility regulation. I never lose sight of the fact that the PSC is our regulator, and every decision I contemplate regarding the financial activities of Mountain Water is with an eye to its rate impact and regulatory appropriateness.

Not only would the community lose the oversight of the PSC should the city succeed in its condemnation efforts, but it would also lose the benefit of the advocacy role performed by the Montana Consumer Counsel. The Montana constitution recognizes the need for utility customers to have an advocate, so in Article 13, Section Two it provides the Montana Consumer Counsel to fill that role before the PSC. The MCC has no standing to intervene on behalf of the customers of a municipally owned utility. If the city comes to own the water system and a customer has an issue, where will they find an advocate or a neutral third party to arbitrate the dispute?

Mountain Water is the fifth-largest property tax payer in Missoula County. For 2013, our tax bill totaled almost $1.2 million. Of that $1.2 million, about $300,000 goes to the city, $200,000 to the county, $200,000 to various special and tax improvement districts, and the remaining $500,000 to the schools. If the city acquires the system, those critical services will still need those revenues, but the city does not pay property taxes. So city and county residents and businesses will inevitably see their tax bills or water bills rise, or else suffer significant cuts to public education and to city and county services.

The city has provided no detailed financial information as to how it will afford this taking, how it would operate the system, or what that would mean in rates for the customers of the system. The only thing for certain is the transaction will be 100 percent debt-financed at a time when this community has many other significant needs to address.

As a taxpaying member of this city, I cannot understand why this community should burden itself with unneeded debt. I ask that you vote against this unnecessary taking.

Comments from Michelle Halley
My name is Michelle Halley. I was raised in Missoula, and have been fortunate to raise my family here as well. I am certified with the Society of Human Resource Management and have worked at Mountain Water Company for 24 years. As the Business Administration Manager I oversee customer service, human resources and office administration.

Our company is proud of its ongoing, long-standing culture of customer service. From the excellent service we provide in our office to how we serve in the field, our employees are extremely engaged in making us the wonderful company we are.

This condemnation has been very difficult for the employee group as a whole. They are worried about the future of their jobs. And they are not convinced that the city’s plan would allow us to continue to provide great service to this community. Now, it’s become even more difficult as the city has gone back on its original employment offer in the court filing and has started to misrepresent the professional work we do. The city’s tactics have gone from challenging the employees’ financial stability, to their pride, and now to their reputations.

The announcement that Liberty Utilities intends to purchase Western Water Holdings and become the new owner of Mountain Water has been great news for us and for the community. Liberty’s culture of local customer care, community investment and employee safety maintains the type of workplace we take pride in. Liberty has offered continued employment for all, and is dedicated to providing great service to our customers.

The city has not provided detailed information to the employee group on what employment and serving this community would look like under city ownership. The actions to date have the employees very worried as it appears that condemning Mountain Water and attacking our integrity comes easier to the city than preparing a detailed employment and operating plan.

I ask that you vote against continuing to fund this unnecessary taking that will only continue to cause unnecessary stress and cost to our dedicated employee group as well as to this community. We have a much better option, as does the community.