ALPENA — The City of Alpena and Alpena Township have reached an agreement on a water and sewer authority draft agreement that could help end litigation over water rates.
In a letter to the media on Monday, City Manager Rachel Smolinski presented an update on what comes next in the effort to create a water authority.
“We are now to the point that requires a deeper understanding of the system as a whole and how it will affect the municipalities and users in the future,” Smolinski said in the letter. “Therefore, we have collaborated and issued a request for proposals to engage with a professional consulting firm with the intention of a mid-March selection deadline. The awarded firm will conduct a joint water and sewer rate study of the City and Township’s combined water and sewer utilities, and evaluate and review the proposed water and sewer authority draft agreement between the City and the Township.”
She said having a consultant address the issues at hand benefits everyone involved.
“We expect that the results of the study will help us make productive progress and answer the questions that you will have as we move forward,” Smolinski said.
In 2014, the city sued after the township refused to pay a rate increase. Township officials believed the township should be considered a wholesale customer, entitled to lower fees because of the volume of water it purchases from the city for township residents.
The two sides have been in litigation since.
The idea of a water authority isn’t a new one. The city put the option on the table in 2014, but the township shot the proposal down.
Most of those on the township board of trustees and department heads at the time have been replaced since then.
In 2017, the Alpena County Circuit Court ordered the two sides into mediation. That lasted only one day, however, as city officials didn’t see enough progress being made to continue.
A settlement appeared imminent early in 2018, however, when both governing boards voted to approve “principle terms” for an agreement. That vote wasn’t on a deal on rates, but on seeking a process for establishing rates that could end the dispute.
After continuing negotiations failed to yield a deal, the local court essentially ordered the two sides to adhere to the “principle terms” they’d reached earlier in the year.
Shortly afterward, however, the township appealed a portion of that ruling to the Michigan Court of Appeals, and the city filed a cross appeal. The appellate court also ordered mediation, which also yielded no agreement.
The appeals court ruled that the proposed agreement being considered earlier was non-binding, which the township appealed to the state Supreme Court, which declined to hear the case, and sent it back to circuit court in Alpena.
Combined, nearly $2 million has been spent on consultant and attorney fees by the two governments.