After months of negotiations, Camp Verde has abandoned its planned purchase of the Camp Verde Water System from the Bullard family, due to irreconcilable differences on pricing.
“It appears that the town can not afford the CVWS assets,” Camp Verde Water System President Stanley Bullard wrote in a letter to the town last week. “The last information we have does not meet our requirements.
“Thank you for your interest in acquiring the CVWS, but currently I believe that it is in the best interest of CVWS to terminate consideration of the LOI [Letter of Intent to purchase CVWS].”
Camp Verde Town Manager Russ Martin presented the results of the negotiations to the Camp Verde Town Council at a meeting on Aug. 15. According to Martin, the town was interested in a price point of $6.5 million, which would allow the purchase to be paid off from revenues from the water company without raising rates. However, the Bullard family sought at least $8 million.
“We had a close number. We thought we had a number and were working,” Martin said at the meeting. “We’re just far enough apart that it appears that we’re not going to get there.”
In the letter sent to the town, Bullard suggested that if the council was still interested in seeking to acquire CVWS, it could do so via eminent domain, but noted that would require appraisals of the company’s worth by both the town and the water company and an extensive legal battle to settle on an agreed-upon cost.
Martin came out against this idea at the meeting, warning of the potential for costs in the tens of thousands of dollars. He said he wants to avoid costs like that from the process, concerned that a high cost for acquiring the water company would end up coming out of the pockets of Camp Verde residents.
“That’s always a concern, because guess who pays it — it’s the guys who pay the water bills,” Martin said. “When we talk about it, we almost talk like it’s two separate people, but if I pay taxes out of one pocket and pay water fees out of another, the service to those thousand customers are the same people.”
With the end of plans to purchase the water company, the town is left without a proper franchise agreement with CVWS, as the previous one expired about five years ago. This has left the town in uncertain status with regard to CVWS’ right-ofway on town property — whether it is permitted to shut down roads or make improvements without seeking permits first — though the water company has essentially been behaving as if the agreement is still in place.
The town and CVWS have been at disagreement over language in the expired franchise agreement from before the town’s incorporation, which required the town to pay for the costs of rerouting pipes when issues arise, an exception not granted to other utilities in Camp Verde.
At the Aug. 15 meeting, the council sought to expedite a new franchise agreement in order to get it on the November ballot, and to seek a ruling from the Arizona Attorney General’s Office on whether the prior rights of the previous contract apply currently after the contract has expired. However, the deadline for submissions for the November election has already passed, so the town will have to find a future date to put a future franchise agreement up for a vote.
In Other Business
In addition to the water company issue, the town approved a contract with Enterprise Fleet Management for the lease of 13 vehicles for use by various town departments, including police and parks, for an annual cost of $102,944.76. By leasing from Enterprise, town officials said they hope to be able to have an updated fleet provided over the years.
“I think it’s a wise long-term move,” Martin said. “Right away it’s not going to save a lot of money, but over the years, with maintenance, etc., it’s going to be a good cost savings and allow us to get newer vehicles sooner than we currently are getting them.”
Also at the Aug. 15 meeting, the council gave permission to the town manager and attorney to purchase the triangular lot on Main Street that previously had the Circle K gas station. The town has considered plans to alter the roads around the lot to ease traffic, and to use the lot as public land as a possible miniature park.
As of press time, the town has not completed the purchase.
Jon Hecht can be reached at 634-8551, or email jhecht@larsonnewspapers.com
