Wilmington continues to seek answers on Caesar Creek-related invoices

Talking with ODNR, Corps in wake of water-related invoices

By John Hamilton - jhamilton@aimmediamidwest.com

WILMINGTON — A few answers to many important questions are slowly starting to surface around the billing of city water and other costs related to Caesar Creek Lake, the U.S. Army Corps of Engineers and the Ohio Department of Natural Resources.

Wilmington Safety/Service Director Brian Shidaker, Water Superintendent Rick Shaffer, and Safety/Service Administrative Assistant Andrea Tacoronte met with several Ohio Department of Natural Resources (ODNR) officials on Tuesday.

“I believe the meeting was a small step in the right direction,” Shidaker told the News Journal. “We still have a lot of questions that need answered before we can feel any sense of optimism.”

In a May 17 News Journal story, city officials expressed frustration regarding invoices they viewed as unfair by the Corps of Engineers for operating and maintenance costs related to the city’s primary water source — Caesar Creek Lake.

The bill totaled $481,589.32 — a larger amount than ever before, and with no explanation and no itemization of the costs.

Wilmington is contracted to pay for 12.87 percent of operations and maintenance related to the Caesar Creek dam and water storage.

The city finally received itemized costs in the invoice for hundreds of items including $144 for “toilet paper holder double”, $300 for “bird seed”, and $1,500 for “repairs Visitor Center urinal wall” — plus for the salaries of workers at Caesar Creek.

The invoices are actually from the ODNR, which serves as the middleman between the Corps of Engineers and the City of Wilmington.

Shidaker told the News Journal that this week’s meeting with ODNR in Columbus was productive, with a common goal of receiving more transparent information on the services provided by the U.S. Army Corps of Engineers at Caesar Creek.

“We expressed our concerns with the contract, specifically the invoice the city received from ODNR, which is simply a pass-through invoice from the Corps,” said Shidaker.

According to him, neither original invoice provided any detail to substantiate the operation and maintenance costs.

A formal public records request was then made to ODNR for a detailed, itemized list of the joint-cost expenditures at Caesar Creek Lake from Jan. 1, 2008 to Dec. 31, 2017.

ODNR had denied the request because they also didn’t have the information, according to Shidaker.

“Receiving information from a federal agency via a public records request can take months, so in an attempt to expedite the delivery of information, we noted during the meeting with ODNR that their contract with the Corps entitled them to inspect and examine operating and maintenance cost records, thus eliminating the need for the city’s public records requests,” said Shidaker.

He asked ODNR to assist the city in obtaining the information so they can be informed — because the city does not have sufficient funds budgeted to pay the entire costs.

“City council has the authority to approve additional funding, but has also expressed concern with such a large, unsubstantiated invoice,” he said. “ODNR was receptive and will endeavor to obtain the information sought.”

In a phone conference between News Journal staff and personnel of the Army Corps of Engineers Louisville District, they tried to bring some clarity to some points in the News Journal’s May 17 story.

Army Corps weighs in

Sharon Bond, deputy chief of the Project Management Division at the U.S. Army Corps of Engineers Louisville District, told the News Journal the first point they wanted to make clear was the relationship between the Corps of Engineers, ODNR and the city.

Bond confirmed the Corps of Engineers has a water storage agreement that was executed in 1970 with the Ohio Department of Natural Resources (ODNR) for 37 million gallons of water per day. ODNR also has contracts with other municipalities for storage.

“We entered into the agreement in 1970; subsequent to that, Ohio Department of Natural Resources (ODNR) entered into a separate sub-agreement with the City of Wilmington. The Corps is not a party to that separate sub-agreement,” said Bond.

“Based on the terms of our contract, the Department of Natural Resources was entitled to that 37 million gallons a day. There are costs that are associated with that water storage. There are operation and maintenance costs and there is another component to that cost.”

The city started to withdraw the water in 1989, and the terms of the contract extend for 50 years from the time when the water was withdrawn from the project. She said that there is no contract between the city and the Corps.

“There is a cost for large storage,” she said. “That cost is based on a methodology that is rooted in law in the 1958 Water Supply Act. The Corps all across the country relies on that same methodology for determining what the costs are for water storage across the country.”

Operation and maintenance costs are based on a percentage of the costs estimated by ODNR. The state has to pay 12.87 percent of annual operation and maintenance costs.

She went on to clarify some of the costs, saying it was important to them that they make sure taxpayer dollars are being spent appropriately. A part of that includes looking at how they make their purchases and how to keep the costs to a minimum.

“Caesar Creek Lake is a 10,000-acre lake. There are often times when we make purchases in bulk or purchases that are meant to last for a considerable amount of time,” she said. “So, if one looks at that and sees $300 for bird seed but there’s no context, then of course, that looks concerning.”

When asked about employee salaries/hourly wages detailed in the itemized invoice — which range from $30/hour to more than $100/hour — the Corps personnel said the figures were not hourly rates, but a combination of hourly rates plus overhead burden including utilities and other overhead.

In regards to being in contact with city officials, Rhiannon Ryan, Chief of the Operations, Technical Support Section, told the News Journal they hadn’t had contact with the City of Wilmington in regards to charges because they don’t have a contract with the city.

“We did get an inquiry from Sen. (Sherrod) Brown and Congressman (Steve) Stivers about this time last year asking for the details of these costs,” said Ryan. “It took us a little while to pull it together because, being a large governmental organization, we had a lot of accounting systems that didn’t necessarily talk to one another very well.”

Ryan was part of a team of people which pulled together the expenses for the first time last spring.

According to her, they had to create a new accounting query in their software so they would be able to pull the costs together in the way that they did. She believes this will make sure they don’t go back to the “dark days” before people knew what was on the invoice.

“It’s a novel method that hasn’t been done before,” she said. “As far as I know, nobody else is doing it. But as part of the fact that we’re finally able to come up with this new reporting system, we have committed to including this level of detail in every report,” she said.

Looking ahead

When addressing people’s concerns about why the city is still paying for using seven million gallons of water even though they’re only using two million, Bond suggests the city look at any possible long-term needs.

“We have entered into agreements with other communities for water storage and they contracted for a specific amount of water storage and later they actually need more,” said Bond. “So, it is a pretty rigorous process to go through” the approvals of municipalities that are needing more. “If a community is withdrawing two-million gallons, but their contract is for seven million, they may want to look at the long-term needs. Are you anticipating there may be some sort of industry in the future where that water withdrawal amount might go up?”

She said Wilmington might have some discussions with the state about the terms of their contract they have.

In regards to the underpayments costs of the last 10 years billed to the city, there had been an error in the assessments made, according to her.

“If we discover an error in the billing we have to correct that error. We have no means to write off that error. We have to make it right,” she said.

Wilmington Safety/Service Director Brian Shidaker told the News Journal that in the next day or so the city should receive more information and they will then determine the city’s next step.

Talking with ODNR, Corps in wake of water-related invoices

By John Hamilton


Reach John Hamilton at 937-382-2574.

Reach John Hamilton at 937-382-2574.