Published Sunday, February 07, 2010

Talks fall flat, water hearing to resume

By Sarah Fay Campbell

The Newnan Times-Herald

Two days of mediation between the city of Griffin, Coweta County, and the Coweta County Water and Sewerage Authority didn't do much to change anyone's mind over a water supply issue, and the parties will be going back to court.

The next hearing is Feb. 22 in Fayette County.

In late December, Coweta representatives attended a bond validation hearing for the city of Griffin and presented Griffin's attorney with a check for $7 million.

The money was intended to purchase a one-seventh share of the Griffin Water System.

Coweta is currently locked into a 50-year water supply contract with the city of Griffin.

Under the contract, Coweta is required to take an increasing amount of water each year until 2025, when the amount will peak at 7.5 million gallons per day. The amount then will slowly decrease through 2049.

The contract, signed in 1999, says Coweta can become an equity partner, but the contract doesn't say what becoming an equity partner actually means.

The water and sewerage authority, which is now a separate entity from the Coweta County Board of Commissioners, hopes that becoming an equity partner will give the authority the right to buy water from Griffin at a cheaper rate. Right now, under the terms of the contract, the price of water is calculated based on the cost of production, debt service, and a 20 percent markup. Attorneys for Coweta and the authority also argue that becoming an equity partner would free Coweta from buying a required amount of water.

Attorneys for the city of Griffin disagree. They say Coweta becoming an equity partner would only give it a share in the profits.

On Dec. 30, Judge Christopher Edwards ordered the parties to go through mediation.

Mediation was held last Monday and Tuesday. At Wednesday's meeting of the water authority, it was originally announced the bond hearing would resume on Feb. 10.

But on Friday, the date was changed. "This is changing as we speak," said Ellis Cadenhead, authority general manager, Friday afternoon. The hearings will be held in Fayette County because that is where Judge Edwards will be on those days.

The bond validation hearing was being held on Griffin's plan to issue approximately $14 million in bonds. The majority of that money was to be used for sewer system upgrades to serve a new industrial prospect, but some of the money was intended to be used to upgrade the pipeline that carries the water from Griffin to Coweta.

The $7 million is currently in an interest-bearing account.