Mayor John Engen Disputes $3.5 Million Figure in Costs to Acquire Mountain Water Company [YouTube]
Missoula Mayor John Engen is taking issue with a report released Friday by the Missoulian newspaper, which was then picked up statewide by the Associated Press, regarding the legal and other costs incurred so far in acquiring the Mountain Water Company.
The report states that legal fees 'have hit $3.5 million dollars, and will likely head higher'.
Engen told KGVO News on Monday that the total cost as of today were far less.
"As of today we have spent $1.3 million," Engen said as he consulted the current costs on a spreadsheet in his office. "That's not just attorney's fees, that's engineering, expert witnesses, folks telling us this is the right thing to do for a variety or reasons, and that's our investment so far."
Engen said that figure is more than he anticipated when he began the effort to acquire the utility for the city.
"It's higher than what we thought, but we've also had a number of unanticipated participants in this lawsuit," he said. "The (Mountain Water) employees joined the lawsuit, Liberty (Utilities) joined the lawsuit, and we've had some interesting motions on the part of Carlyle that forced an increased cost in lawyering."
Engen said a motion to postpone the court case past the March 15th trial date was thrown out by Judge Karen Townsend in December. He put forth some of the arguments the city will make during the upcoming trial.
"We will demonstrate that it is more necessary for the city to own this water monopoly than for any other entity," he said. "After the court arguments, we would enter into the valuation stage, in which a three-member panel approved by the court would place a value on the utility."
Engen addressed the fear that city ownership of the water utility might lead to forced annexation.
"It could be used as a tool to force annexation," he said. "But frankly, it doesn't pay to annex a single household by using the water utility, any more than it pays to annex a single household by hooking up to city sewer."
Engen attempted to put to rest the fear that under city ownership, the utility and its rates would no longer be regulated by the Montana Public Service Commission.
"Every other water utility in every other major city in the state is also not regulated by the Public Service Commission," he said. "Almost to a city, those rates are lower than what we're currently paying under Mountain Water. In addition, those systems are likely to be in better condition Regulation by the Public Service Commission does not guarantee lower rates, nor does it guarantee system maintenance."
Mountain Water Company President and General Manager John Kappes said the City of Missoula has neither a strong operational plan, nor a viable financial plan for the water company.
“So far, we haven’t seen that the city has a strong financial plan, and it’s not the necessary direction for this community to go,” he said. “We feel the city has been served very well from the 1800′s until the present by private ownership of the water company.”
The condemnation lawsuit is expected to be heard in Missoula County District Court in mid-March.