CPA chosen for Union-Rome review
Published 11:03 am Tuesday, March 25, 2014
SOUTH POINT — South Point CPA Robert Payne will be the accountant to look into the financials of the Union-Rome Sewer District with the goal of lowering customers’ rates.
Two weeks ago Lawrence County Commissioners proposed hiring an independent accounting firm to see if the Union-Rome system could function economically if the $50 a month rate was reduced.
“We believe those rates are ridiculous,” Commission President Les Boggs said at the time. “We would take that study to the OWDA (Ohio Water Development Authority).”
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The OWDA lent the county approximately $25 million to build the new sewer plant in 2008. Original terms were at an interest rate of 3.25 percent over a 10-year period. At that time the county was still paying off the non-callable bonds issued to finance the former system at 9.78 percent interest rate. Those bonds did not mature until 2012.
According to Boggs when the county defaulted on the first payment on the new plant, the OWDA determined the new rates then and all subsequent increases. However, according to County Auditor Jason Stephens, who was on the commission at that time, when the county defaulted it re-negotiated the rates at 1 percent over 30 years. That renegotiation included the new rates.
Stephens and Boggs have debated whether the commission has the right to change the rates on its own authority. Boggs says the OWDA is in charge of the rates while Stephens says they are under the jurisdiction of the commission.
Boggs anticipates the independent study to be completed by mid-May.
“Most CPAs now are busy with income taxes,” he said. “We will let him interview the director of the Union-Rome and maybe what plans there are in the future.”
One update is scheduled for 2018 when membranes used in the filtering process are to be replaced for an estimated $1 million.
“He is well-known in the county and years ago he did the (Lawrence County General Hospital’s) receivership and did really well,” Boggs said.