The sale of Westwood Utility Corporation, which provides water to homeowners in Oak Forest and Westwood subdivisions, located outside the city limits, was completed on June 27, 2017.
After a 12-month long process, the City of Fairfield acquired ownership on June 27, 2017 with a $3 Million price tag.
When choosing to sell Westwood Utilities, former owners, Mary Jean and John Alford, had expressed their desire to pass the corporation on to a financially stable entity that could continue the good service to their customers.
The City is purchasing Westwood Utilities through owner financing. To get services, companies often look at your credit history – including your record of paying for utilities at any previous residences. Paying your utility bills on time is important that why Solutions for Community Owned Utilities is the best option for you.
An initial down payment of $250,000 has been paid (put into an escrow account), and the City of Fairfield is obligated to two (2) payments per year, together totaling $209,976 for the next 20 years.
According to City Administrator Jeff Looney, the money for this purchase was in the City’s budget. “The citizens did not have to put out $3 Million for this.”
Utility purchases such as these are required to be approved through the Public Utility Commission (PUC), who looks at the viability of the purchasing entity, as well as the affect of the transaction on current customers.
Basically, during the 12-month long process, PUC sought to determine whether the City could
- afford the purchase,
- had the resources to adequately maintain the utility services once they bought it, and
- that services received and costs incurred would either remain the same or be improved for customers.
According to documents submitted to PUC, Westwood Utilities serves 420 customers.
Twenty-four of them submitted a Request for Public Hearing to protest the sale of Westwood Utilities to the City of Fairfield.
Some of the issues brought forth included:
- future rate hikes,
- limited water supply being funneled to the prison and/or a proposed water park,
- lack of confidence in the City’s ability to maintain the system, and
- inflated purchase price that would eventually be passed on to utility customers.
According to a recent letter announcing the final purchase, sent to Westwood Utility customers by the City, “current billing cycle and water rates will remain unchanged at this time.”
Concerning the prison water supply, City Administrator Looney says the City currently operates two wells at the prison. “They are getting old and could play out in the future,” he says, adding that the drilling of a new well is planned and will be paid for by the prison to account for their water usage.
The proposed water park project has been scrapped, as Fairfield did not secure the anticipated grant for building it.
PUC determined the City of Fairfield had demonstrated adequate financial and managerial capability, to provide adequate and continuous services to Westwood Utilities customers.
Final approval was signed off on April 11, 2017.
The actual purchase price, inflated or not, was not addressed by PUC.
Perhaps the biggest concern addressed be Westwood Utility customers, in these letters of protest to PUC, was the possibility that the City of Fairfield would be use the purchase to strong-arm residents in a future move to annexation.
Annexation was not a consideration by PUC, in approving the sale transaction, as they stated future land use was “beyond the scope of this proceeding.”
While Fairfield has been investigating the option of annexation for future growth for quite some time, Mayor Roy Hill, along with every single Council member, has publicly stated, several times, that forced annexation is not something they support.
Resident Mark Berend, one of the first to file a letter of protest last year, attended a City Council workshop several months ago in which the subject of future annexation was addressed.
“Folks are polarized. They don’t feel they have a voice,” said Berend, saying that residents were afraid the City would just come in and do whatever they wanted to.
Berend stressed the need for transparency and awareness of the process.
That evening, on May 23rd, the Council was in complete agreement, stressing the need to get information out to the residents.
Referring to the first meeting with Oak Forest residents, Mayor Hill acknowledged that, “They didn’t know the facts, and we didn’t have the facts to give them.”
According to City Administrator Looney, in regards to possible annexation, the City is still in investigative mode.
“There is a process with lots of stages,” said Looney, put into place to protect residents.
“We have to have hearings, a plan has to be developed (and, approved), and we [the City] has to provide services to the area,” explains Looney.
The City Administrator reiterated what Council has stated during several Open Meetings: voluntary annexation allows for negotiation.
Such an agreement with future city residents could include stipulations involving city services, utility rates, street repair and more that would be beneficial to residents of Oak Forest and Westwood subdivisions, should they agree to annexation in the future.
