Wilmington has new ally in battle over water bills: Ohio AG sues Army Corps over ‘unbelievable’ charges to city

By Tom Barr - tbarr@wnewsj.com

WILMINGTON — The water bill war is headed to court, and the City of Wilmington has a strong ally on its side — the Ohio attorney general.

The ongoing battle against the U.S. Army Corps of Engineers over what city officials call unfair and exorbitant invoices from the Corps related to Wilmington’s primary drinking water supply at Caesar Creek Lake has taken a new turn.

Ohio Attorney General Dave Yost sued the U.S. Army Corps of Engineers Friday in federal court to recoup improper charges billed to the state for the upkeep of Caesar Creek Lake.

The lawsuit, filed in the U.S. Court of Federal Claims, contends that the Corps of Engineers has jacked up costs without providing complete itemized receipts to support the price increases. Receipts that have been provided list questionable charges, according to a news release from the AG’s office on Friday.

“The Army Corps of Engineers has kept tight-lipped when pressed about these excessive and unreasonable charges,” Yost said. “Some of the receipts we have seen are unbelievable – like charges for attending a boat show. We want our money back.”

Under an agreement reached in 1970, the Ohio Department of Natural Resources (ODNR) pays the Corps of Engineers for maintaining and operating the reservoir, a water source for the City of Wilmington. ODNR bills the city for reimbursement.

According to the contract, the maintenance and operational charges are supposed to be limited to those involving flood control and water supply. However, some available receipts list charges for unrelated purposes, such as travel to a Cincinnati boat show, solar panel repairs, a washer and dryer and a set of American flags.

The state’s lawsuit seeks damages to compensate for the overcharges and a judgement specifying what constitutes maintenance and operation costs under the contract. Attorneys from Yost’s Environmental Enforcement Section are representing ODNR in the case.

City has been battling Corps

Several months ago city officials felt contract renegotiations were on the horizon toward more equitable billing when city, state and federal officials as well as legal counsel met in Cincinnati

“All we’re looking for is a fair contract, and after this meeting, it’s starting to look like we’re headed in that direction,” Wilmington Mayor John Stanforth said last May, adding that the impression he got from the meeting is that Major General Mark Toy, Division Commander of the Army Corps of Engineers, wanted to see something done.

The meeting was chaired by Toy and U.S. Rep. Steve Stivers (R-15th District). In addition to staff members from their offices, Ohio Department of Natural Resources Director Mary Mertz and several members of her staff participated.

Wilmington purchases water from Caesar Creek Lake through an agreement with ODNR, which in turn contracts for the water through the Army Corps of Engineers.

The city has been contesting significant portions of the operations and maintenance bills, which have included upkeep and operations of the Visitors Center and other items that appear to have nothing to do with the storage of water.

City Safety/Service Director Brian Shidaker told the News Journal last year a big part of the discussion was the definition — or lack thereof — for operation and maintenance. According to Shidaker, the Corps acknowledged this aspect.

“The Major General asked his staff to sit down with ODNR and reach a shared understanding of the definition of operations and maintenance and how those terms apply to current and future charges,” Shidaker said then. “This is vital to the city because it not only provides budget predictability and stability, but also fairness.”

Last summer the city recently received its annual bill, totaling $206,712.35, for July 2017-June 2018 — much less that the previous year’s bill of $481,569.32.

“We are pleased the bill is less than last year’s,” Stanforth said in April 2019, “but after a thorough review, it includes many items the city insists are outside our contractual obligation” which included items ranging from Visitor Center expenses to participation in the Cincinnati Boat Show to sunscreen.

Bird seed to urinals

The city is contesting these annual “water bills” which include hundreds of line items, including, for example, the below from the July 2015-June 2016 bill:

• $144 for “toilet paper holder double”

• $400 for “double post locking toilet paper holders”

• $300 for “bird seed”

• $660 for “brochure stands”

• $60 for “sheet protectors for slides”

• $1,500 for “travel orders”

• $1,200 to “paint Visitor Center breakroom kitchen and hallway steps”

• $1,500 for “repairs Visitor Center urinal wall”

• $150 for “calendars and forms”

• $152 for “replacement mascot transport”

• $2,900 for “toner and office supplies”

• $2,200 to “deep clean tile floors”

• $1,200 for “med serv physicals CCL”

• $14,000 for “project office building staining”

• $1,500 for “uniform purchases”

• $1,800 for “security camera installation at the Visitor Center”

• $10,000 for “zero turn mower”

• $2,100 for “pm start-up of furnace at Proj Office”

• $2,400 for “springtime start-up on HVAC/AC units”

• $47 for “touch-up paint for Visitor Center hallway”

• $800 for “carpet cleaning”

• $2,100 for “office furniture”

• $2,500 for “removal of dead ash trees”

• $15,000 for “sealing concrete sidewalks Visitors Center/area office complex”

• $22,000 to “replace siding on pole barn”

• $799 for “table carts large”

• $495 for “desk adaptor”

• $900 to “remove oak tree at Visitor Center”

And for “in-house labor”:

• $1.07 million, for well over 100 job title line items, most of which are billed at a rate of between $50 and $100 — per hour.

• Titles range from geologist ($99/hour), biologist $118/hour), civil engineer ($113/hour), archaeologist ($105/hour) and procurement analyst ($94/hour) to realty specialist ($101/hour), regional economist ($99/hour), management analyst ($52/hour), maintenance worker ($46/hour), laborer ($34.37/hour) and student trainee ($32.13/hour).

“The city feels strongly that over the years the Army Corps has expanded the kinds of activities that it expects the city to help pay for,” said Shidaker. “The city never agreed to pay for these kinds of things and has an obligation to push back on the behalf of our citizens.”

Wilmington obtains the bulk of its drinking water from Caesar Creek Lake. The remaining water comes from city-owned reservoirs at Burtonville.

Through a series of contracts with the Army Corps and the Ohio Department of Natural Resources (ODNR), Wilmington receives the bulk of its untreated drinking water from Caesar Creek Lake. The contract stipulates that Wilmington pay 12.7 percent of the Army Corps’ operations and maintenance cost related to the supply of water and the dam.

“We are willing to pay a fair bill that only covers items related to the water supply and the dam,” said Stanforth. “But it’s maddening when you look through this bill and see what they are charging us for.”

The city’s analysis of its most recent bill indicates about 26 percent of it can be related to water supply activities, while about 53 percent relates to things that the city is not obligated to support. Items related to the remaining 21 percent of the bill do not provide enough information to determine whether the charges are proper.

After consulting with outside legal counsel, the city had agreed 47 percent of the bill, or $97,154.80. The payment is being made as “a show of good faith,” Shidaker said in a letter accompanying the check. “The city reserves the right to contest any and all paid and unpaid charges.”

Shidaker said last year, “I would prefer that the Army Corps, ODNR, and the city work together and resolve the issues through avenues that would be less taxing on everyone involved, but we will pursue this matter as far and as long as we have to for the benefit of the city and our residents.”



By Tom Barr