Water & Wastewater Authorities

April 2006

This Legislative Session Senator Beavers and I have been busy trying to pass meaningful reform for water & wastewater authorities. It is no secret that our local wastewater authority is no fan of our legislation. In fact, they’ve hired a prominent lobbyist to fight the bills which will make passage much more difficult; combined with the new political dimension of the attorney for the Wilson County Wastewater Authority challenging Senator Beavers in the election, it is perhaps impossible.

The problems between our local authority and the county government seem to boil down to two things; accountability and communication. We think we have written legislation to remedy both of these problems.

In conducting research for the bills, I thoroughly examined the Tennessee Code applicable to Utility Districts. There is very little difference in function between a utility district and a water & wastewater authority. Both are government entities that provide water and wastewater services to citizens in a given area.

However, the main difference in the law between the two entities comes down to accountability. Utility districts are under a state board that provides regulation for review of rates and financial audits. It also provides a mechanism for customers to seek resolution of complaints. An ethics law prevents personnel from financially benefiting from service agreements. Explicit purchasing procedures ensure ethical purchasing practices. Racial discrimination against customers and employees is expressly prohibited. Also, utility districts have extensive instructions on audits, accounting, books and records.

The law governing water & wastewater authorities does not provide for any of the functions listed above but each authority is left to their own initiative to enact some of these items. However, because no one is checking to make sure that each authority in the state does enact these items, it is possible that some may not.

Our two bills will have water & wastewater authorities come under the review of a state board; the Water & Wastewater Financing Board. It will allow for an annual review by the creating governmental entity where the elected officials, citizens and the media are present to ask questions and discuss the future needs of the area. A statement will prohibit authorities from discriminating against persons who work for the authority or receive services. It will devise a mechanism where “no bid” or “sole source” contracts are reviewed, and as in utility districts, an ethics clause will ensure that the employees of any authority are not otherwise profiting from the contracts or services of the authority.

I can see no reason to fight these measures. Each will help to create better accountability and greater communication between the water & wastewater authority and the elected officials of the county.

The ethics clauses are particularly important. The attorney for the wastewater authority told me himself that he is presently serving as the water & wastewater authority’s attorney, the attorney for the sole source contractor who installs their wastewater systems and very often the attorney for the developers who purchase the wastewater systems.

Based on my conversations with several local attorneys, most would avoid such competing interests. How can the water & wastewater authority, the customers, and the citizens of the county, be sure that their attorney is vigorously looking out for their best interests if he is representing all three ends of the deal?

Private entities can wave whatever conflicts they want to wave. However, a public entity should not have the right to wave ethical conflicts, and allow them to occur, because they are dealing with public money.

Such activity is already illegal, and for good reason, for most who work for government entities. One local government prohibits any employee from receiving money from, or being involved in, any company who has done business with the government in the past year. Each employee must annually sign a form attesting to such.

My only interest is to help our government ensure accountability and that the elected officials of the county are better able to oversight the entity that they created. I truly believe that the reforms in our legislation are in the best interest of everyone, including wastewater authorities.