Wednesday, March 21, 2007

Written on 3/21/07

A Wild Guess and a Bet

A positive outcome of the Board of Commissioners 3-2 vote on March 6 to join Walton County in the Hard Labor Creek reservoir project is that Chairman Melvin Davis was forced to vote.

Davis does not like voting, which he only does in the case of a tie. When Commissioners Chuck Horton and Margaret Hale voted in two different motions against joining with Walton County in the $350 million project, Davis voted with Don Norris and Jim Luke to create the majority.

So Davis, Luke and Norris now will have to defend this decision going in to the 2008 elections.

Davis had been pushing hard for the BOC to select one of two massive reservoir projects, and the only reason for any decision at this time was the desire on the part of those behind the Walton County project to get Oconee County on board.

Davis said the County needed to act because it was running out of water, but that claim is based on estimates of growth in water demand that are tied to what are almost certainly overestimates of population growth.

The County estimated that Oconee’s population will grow by 30.6% from 2005 to 2010 and again by that same percentage from 2010 to 2015. This is a high-end estimate that ignores the more modest growth rate of 13.4% that the Census Bureau has used to project the County’s 2005 population based on the actual count in the 2000 Census.

If the 30.6% growth rate is used, the County would have 67,065 residents in 2015. If the more modest–and realistic–growth rate of 13.4% is used, the County would have 38,275 residents in 2015. The County was estimated to have a population of 29,748 in 2005.

The County estimated water demand by multiplying the current usage figures by the 30.6% growth rate figure. Estimates of the County’s ability to pay for the new reservoir are based on selling that much water. This means the County either needs to find customers for the water or to find some other source of revenue–such as taxes–to pay for the reservoir project.

A second positive outcome of the BOC meeting on March 6 was a unanimous vote to deny a rezone request for a gas station and convenience store on US441 in southern Oconee County. One reason this project made no sense was that the County doesn’t run water lines into the southern part of the County.

As significant as the rezone denial was, it almost certainly will be rendered meaningless in the long run because of the vote on Hard Labor Creek. The County almost certainly is going to have to run water lines down US441 to encourage development and pay for the Hard Labor Creek decision.

In the weeks before the Hard Labor Creek vote, Davis and Luke argued that the County needed to build a big reservoir even if the population growth rates were inflated because of expected commercial and industrial demand. No effort was ever made to estimate that demand, however, though it certainly is possible to do that.

On February 25, 2007, I sent an e-mail message to Davis asking him for information that could be used to make such a projection. Specifically, I asked for the following:

1. Audited figures for the number of water customers of the Oconee County Water Department since its creation, broken down by category of residential, industrial and commercial user.

2. Audited figures for actual water usage by customers of the Oconee County Water Department since its creation, broken down by category of residential, industrial and commercial user.

3. Water rates for residential, industrial and commercial customers of the Oconee County Water Department for each year since creation of the department.

4. Sources of water sold by the Oconee County Utility Department since its creation, broken down by year.

5. A map of the service area for water of the Oconee County Utility Department and the proposed service areas as far into the future as such projections exist. If possible, please provide this map as an overlay of the 10 census blocks in the County.

On February 27, Davis sent me the following note:

"Your request is very detailed and frankly, I do not think we can provide that detail without significant research. We are required to keep records for a certain period of time by EPD. Audits are financial audits including revenues and expenditures, etc."

The grammar is his, as is what I take to be an acknowledgment that the County has never made projections based on anything other than population projections.

I’ve never heard more from Davis on the topic.

Among the data that were not used by the County are those on the web site of the Oconee County Planning Department. The Planning Department shows population trends and projections for each of the 10 Census blocks. The Census Bureau projects growth from 2005 to 2010 of 10.0% for the County, rather than 13.43% growth rate from 2000 to 2005. In other words, even before the current slowdown in the housing market, the Census Bureau was projecting a slowdown in County population growth.

Davis did find the time on March 5 to send a two-page, rambling response to a one paragraph note from County resident Luke Naeher written on February 26. In that message, Davis said:

"I believe our water need estimate is accurate. The RDC (Regional Development Center with the Department of Community Affairs) assists the Oconee region (12 counties) with regional planning. One of their responsibilities is to prepare population projections for planning purposes. For Oconee County long range planning purposes, we have consistently used the high population projections. (We prefer to err on the side of excess rather than on the side of shortfall). Remember, the population projections that are used to plan for future water needs do not include commercial, retail, industrial, institutional, office or school use."

As I read this, Davis is saying "we made a wild guess."

Unfortunately, Davis, Norris and Luke also made a "bet" based on that "guess." And they used taxpayer money to make the bet.

This is a decision that Davis, Norris and Luke deserve to be asked to defend come election time.

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