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Surgoinsville wants to iron out contract before turning over water plant grant

Jeff Bobo • Apr 12, 2007 at 11:09 AM

SURGOINSVILLE - Surgoinsville Mayor Johnny Greer said Thursday he's looking for more considerations for the residents of his town from the First Utility District before turning over a $750,000 Community Development Block Grant.

Last year, Surgoinsville was awarded a $750,000 CDBG for the purpose of helping fund FUD's proposed $10 million water treatment project. The grant was applied for under the administration of former Mayor Hanes Cooper.

Greer admitted Thursday that wouldn't have been his first choice for the use of grant funding received by the town.

But as long as the grant is now approved and can only be used for that purpose, Greer said he's ready to enter into negotiations with FUD to turn over the funds. The town has already received a draft of a contract from FUD for that purpose, but Greer said the benefits to the town outlined in the contract are vague at best.

The contract, which was presented to the Times-News for review Thursday, states that the independent Surgoinsville Utility District, which serves Surgoinsville residents, will be eligible to purchase water "at a discount rate" and "from time to time."

"It doesn't get into much detail, and it leaves a lot of wiggle room, and I want the contract to plainly say what our town's residents are going to receive and for how long," Greer said. "Considering that our town gave up a CDBG to benefit this water utility which doesn't even serve our town, it only seems fair our residents would receive some benefit from this. ... If we worked out some agreement that said Surgoinsville would receive so many gallons per year at cost for X amount of years, maybe at some point down the road this is going to save our residents from having to go through a water rate increase."

Greer noted that he has the power to "pencil out" the $750,000 CDBG - in other words, send it back to the state. But he said that shouldn't be necessary.

"I don't want to do that," Greer said. "Even though this grant doesn't help Surgoinsville directly, it could be a plus for Surgoinsville if they can increase the supply at Phipps Bend. A lot of our residents work at Phipps Bend, and I would hate for them to miss a good opportunity for a new plant to move in there because there wasn't enough water.

"I want to go on record as saying I'm for the grant, but I think we deserve something in return."

FUD Director Allen Jones told the Times-News Thursday the contract sent to Surgoinsville was only a draft and is open to negotiation. Jones said Surgoinsville's $750,000 contribution to the FUD water treatment plant project is crucial, and he has no problem with making considerations for the town.

"He (Greer) just needs to call me," Jones said. "Wholesale water wouldn't be an unreasonable request. They're supposed to be looking at the contract and deciding what changes they want, and we're waiting to hear back from them."

The FUD contract was on the agenda for Monday's Surgoinsville Board of Mayor and Aldermen meeting, but no action was taken.

Greer said he received a bit of good news about Surgoinsville's grant status recently from the state. There was concern that the $750,000 CDBG application to benefit FUD would tie up Surgoinsville's grant eligibility for two to three years while the water plant is under construction.

Greer said he has learned that Surgoinsville will be eligible to apply for a new CDBG next February.

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