Signal Mountain Puts Off Action On Water Issue, Budget, Filling Council Vacancy

Wednesday, July 11, 2018 - by Gail Perry

The three main items on the agenda for Signal Mountain’s July council meeting Monday night all failed to move forward with a vote, stopped by objections from Councilman Dan Landrum, including a decision on the sale of the town’s water system. A first vote to send the options of keeping it, selling it to Walden’s Ridge Utility or to Tennessee American Water was postponed to allow an ad hoc group of citizens to gather information relating to the viability of Signal Mountain retaining ownership and management of the utility and to make a presentation at the August council meeting.

Around 20 citizens spoke including those who are on the ad hoc committee. Most were in opposition to selling the water system. They asked for more time before voting, and to allow for the group of citizens to make a presentation to the council. Many in the group, including Councilman Landrum, accused the council of not doing due diligence concerning retention of the system and rushing a vote without giving enough information to the public.

Addressing the accusations, Town Attorney Phil Noblett said the proposed sale of the water company had not been sprung on residents of the town. There have been at least four public hearings on the system since May, 2018. There was also a presentation on April 4 by Bill Lusk who helped write the RFP and one given by Town Manager Boyd Veal he said. At the beginning of the conversations about the sale, said Mr. Noblett, the town had asked for a study and recommendation from the Municipal Technical Advisory Service (MTAS), which had been denied. Discussions about the future of the Signal Mountain water system began three and a half years ago. And the RFP went out in December 2017.

Monday night, Mr. Landrum informed the council that he had contacted MTAS and asked for a study, which the organization now agreed to do. He asked the council to hear the ad hoc group he has been working with, at the next council meeting as opposed to having a separate public hearing for the presentation, as was approved at the June 29 agenda work session.

Because it is another contentious subject and the community is divided, Councilperson Amy Speek suggested accepting the offer of a study from MTAS. The original timeline was created so Vice Mayor Dick Gee could participate in the decision before leaving the council in mid-August because of his extensive knowledge and history with the water system issues. Mr. Gee agreed to pass on information to his successor and the council voted to postpone a decision and have the MTAS study done.

The council is required to send information about the three options to the planning commission, which will make a recommendation. The final decision will then require two votes from the council.

The choice of filling the two-month vacancy that will be left on the council when Mr. Gee can no longer serve was another conflicted decision. A process for choosing the temporary replacement had not been put in place, insisted Mr. Landrum. “He’s talking about a recall election when there was a two-year vacancy,” said Mr. Noblett, clarifying Mr. Landrum’s request for a process. 

At the April meeting the council discussed options for the replacement. The procedure that was agreed upon was for the council to make nominations and a majority vote would decide the replacement for the remainder of the term. Don Close and Annie Hall accepted the nominations, but Ms. Hall later withdrew. Monday night, Mr. Landrum requested waiting until when the vacancy began before selecting a replacement. “You need to have a plan in place before the last minute,” advised Mr. Noblett. "I do not recommend waiting," he said. The vote to accept Don Close did not receive approval with Mr. Gee abstaining. The proposal from Councilman Robert Spalding to accept four applications with a vote at the next regular meeting passed.

A vote on accepting the 2018-2019 budget also failed to pass. The proposed budget included spending three percent above projected revenue. Budgeting is not an exact science, said Mayor Howley. It is based on history and best guesses. He said in analyzing budgets from the last six years, that revenue was under  estimated an average of about 7 percent and expenses were over estimates an average of 8.6 percent, creating an average difference of 15 percent. Expenditures and revenues work together, he said. The past councils were budgeting for every possibility, he added.

City Manager Boyd Veal said that staff spends 12 months identifying savings and looking for grants to make the numbers as good as they can be for the town, which explains some of the differences. The mayor said that this council has been systematically working the way down to the 35 percent fund balance that Signal Mountain is required to have. This is so the citizens will not be overtaxed, he said. In the unlikely event that there is a three percent deficit at the end of the year, that is well under the average excess from prior budgets, said the mayor. At the insistence of Mr. Landrum that the budget needs to start out being balanced, the council agreed to revisit the 2018 budget. A continuation budget was passed that will allow the town to continue to operate on the budget from 2017.

This decision will result in the town’s staff going back and starting over in creating the new budget. It will also require another public meeting and two votes before it can go into effect.

In other business, the purchase of a hook-lift truck was approved for an amount not to exceed $181,030 and an automated leaf machine for $83,740. Authorization was also given to apply for the Tennessee Municipal League Safety Partners Grant that will be used to purchase safety equipment for town employees.



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