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City to move forward selling wastewater effluent

May 17, 2011

The city plans to move forward on selling effluent water from its wastewater treatment plant. Members of city council announced during their Monday evening meeting that Second Sun Oil and Gas, LLC recently expressed interest in purchasing water, with the plan to act as a broker and resell the water to EOG Resources, Inc.
City Manager Dave Greene explained that he, along with Public Works Director Mike Mullaney and Wastewater Treatment Plant Operator Lad Kornacki, recently met with members of the St. Marys Municipal Authority, and the proposal was made at that meeting.
"Basically what the municipal authority is asking is if you want them to undertake this project, they will do that. They didn't want to do that without your permission. They asked that I bring it to council's attention," Greene said.
City Councilman Dan Hepner noted that, according to the draft agreement presented to council members, there is no cost to the city or municipal authority to undertake the project.
When asked, city solicitor Mark Jacob indicated that while he had a chance to review the proposed agreement, he did not revamp any of it.
"If you look at that, it needs, obviously if nothing else, some grammatical changes. The reason I didn't revamp it was because I wasn't sure which way council was going to look at this. If they were going to have the municipal authority handle it, their solicitor should really do that. If you're going to say, 'well, we'll do it through you,' then obviously I would do it," Jacob said. "That's why that has not been rewritten. Obviously there are some things that need to be addressed in there."
After some discussion, Hepner suggested that the city handle the sale of the water, rather than the municipal authority.
"It's just given the flow of money through the municipal authority that any revenue generated by the municipal authority stays there," Hepner said.
Council members also indicated that the distribution of the funds generated from the sale would have to be worked out between the city and municipal authority.
Councilman Dick Dornisch said he remained skeptical of the deal, and cast the only vote in opposition to the city selling the water. Dornisch asked if anyone needed to be hired to oversee the process, to which council responded that they did not.

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