Henderson Mayor Clem Seifert announced to the City Council at Monday night’s meeting that a new water storage contract has been presented by the Army Corps of Engineers.
Seifert told the council that the new contract reflects the different cost structure that had been requested by the city. The fee for water storage as reflected by the new contract is $2.75 million, down from the last offer from the Corps of $3.6 million. The contract, once signed, will give Henderson the right to draw 20 million gallons of water from Kerr Lake per day.
Seifert informed the council that the contract still contained items that needed to be “cleaned up”. Although the nature of these items was not made clear during the meeting, the mayor was precise in explaining that they did not affect the cost of water storage nor the finance rate the city will pay on water storage, a little over 4 percent.
Seifert presented three options to the council: do nothing, sign the contract that has been presented to the city, or use the extension offered by Assistant Secretary of the Army John Paul Woodly verbally in a meeting last month. That extension would be good until March 30, 2006. Seifert indicated that the city’s partners in the regional water system, Oxford and Warren, had no issue with signing the contract as written.
City Attorney John Zollicoffer told the council that Warren County had expressed a problem with the Corps offered rate of interest. He informed council members that the city can prepay the cost of water storage without a penalty if a better interest rate can be found.
Council member Bernard Alston commented that the terms of the currently offered contract are “as good as it is going to get”. He stated that there may have been a time when the city could have negotiated something better, but not at this time.
Council member Elissa Yount stated that the offered water storage price is the best that had been quoted by the Corps. She indicated that those involved with negotiations were “pleased with that”. Yount stated that attention could now turn to other matters and indicated that there exists a consensus that the contract be signed.
“We felt if we could get in front of the right people we could get favorable action,” Seifert told the council. He gave Representative G.K. Butterfield credit for getting the Corps to the negotiating table. He then asked the council for authorization to sign the contract.
“This is a big deal,” Seifert said. He expressed to the council a desire that a signing ceremony be scheduled. He said that the Corps may be willing to come to Henderson. He told council members that he would call the Corps and see what they want to do.
A motion to sign the contract and review it later was passed unanimously.