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Smithfield facing some big decisions

June 9, 2012
The Herald-Star

Smithfield officials have a tough choice to make concerning the future of their community's water system. It may be an emotional issue, but it should be looked at as a business decision.

Smithfield, like many small communities, is hurting financially.

The IRS at the beginning of the year seized about $75,000 in village cash because officials weren't deducting the correct amount of withholding taxes. The village also owes $5,000 to the state Public Employees Retirement System, $46,000 to state Workers' Compensation and about $6,400 to the state for unemployment benefit costs.

Add the more than $100,000 owed to Jefferson County for purchased water, and it is plain to see the village is slowly going under.

The state auditor's office wants to conduct a routine audit of village books, but found the records are in such disarray that an audit can't even begin. The village is under a mandate to get the books in order.

A hearing was held Monday in Jefferson County Common Pleas Court concerning the county trying to collect the more $100,000 owed by Smithfield in water purchased. The motion was filed as part of a 2004 case the county filed to collect $267,354 owed in water bills. The village has almost paid off that amount, but a new debt is increasing.

All the money Smithfield collects in water bills from customers is paid to a court-appointed receiver. There is little or no money to make repairs or improvements to the water system first built in the 1930s. About one-third of the water meters in the village don't work, and those households are billed for a minimum amount of water, regardless of how much is actually used. Add water loses due to leaks all water systems have and the village ends a month not collecting enough money to pay for the water purchased from the county.

The county has offered to take over Smithfield's water system. The county commissioners also have offered to forgive the $100,000 debt as part of the takeover.

Smithfield officials should seriously consider the offer. The village obviously can't collect enough money to get out from the debt to the county. Smithfield is charging residents extra money every month to try to catch up on the amount owed to the county.

Village residents will face higher bills if the county takes over the water system, but also can expect improvements to be made. The county also will have the ability to make water line extensions to other nearby areas that have been asking for county water for decades.

The county's water and sewer system already helps Smithfield fix water breaks because a leak there causes a strain on the county's pumps in Brilliant.

Local governments should be operated like a business. Businesses make decisions based on the bottom line. Emotions don't enter into those decisions.

Smithfield officials apparently are hesitant about turning over their water system to the county.

The bottom line is the water system should be turned over to the county. But county officials also need to weigh whether it is correct to forgive the $100,000 debt at the cost of all county water customers.

Tough decisions have to be made.

 
 

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