Tellico Area Services System Superintendent Mark Clinton came before the Tellico Reservoir Development Agency board Wednesday to ask that they forgive two sewer and water line contracts.

He said when the contracts were first entered into they were probably good for both TRDA and TASS.

“But, as of today that is no longer the case,” Clinton said.

The contracts are for the sewer line on East Tellico Parkway and the water and wastewater lines running to Tellico Harbor.

Clinton said for the past five years the East Tellico Parkway line has been a negative impact.

The line is 13 miles long and has 10 of TASS’s 15 pump stations on it. Clinton said before the contract is fulfilled all 10 pumping stations probably will need to be replaced.

TASS receives about $367 a month off the line, but it costs $884 per month in basic operating costs. 

As part of the contract, TASS collects the $1,500 connection fee for any new customers tapping into the line. Since the beginning of the contract, TASS has paid TRDA $315,000 in connection fees. Clinton estimated it would be 2028 before the remaining $1,263,122 would be paid off.

Also, as a condition of the contract, TASS was required to acquire the Niles Ferry Wastewater Treatment Plant from Monroe County. Now TASS is faced with expanding the plant at an estimated cost of $9.4 million.

Clinton said if the TASS board had known five years ago that the contract would create a $10 million liability the board likely would not have signed it. And he believes the TRDA board would not have asked them to.

The Seven Cs Contract

The “Seven Cs” contract for the Tellico Harbor line has been in place since 1986. TASS has paid TRDA $160,329 on the line and still owes $174, 947

The agreement requires TASS to pay TRDA 40 percent of all water and wastewater revenues and 10 percent of indirect water and wastewater revenue from the subdivision.

The current average monthly revenue from the Seven C’s is $3,565, with less than 40 percent of that going to TRDA. The current operating cost for the water and wastewater line is $492 per month. It is estimated it will be the year 2031 before the contract is fulfilled. 

Also, the pump station in the subdivision needs to be replaced and will cost approximately $130,000.

About TASS

TASS currently has 47 miles of sewer line and 239 miles of main water line. The sewer plant is nearing 100 percent capacity. TASS has five water storage tanks and will need to add a sixth tank in Lenoir City to serve Rarity Pointe. 

TASS has 3,426 residential customers, 248 commercial customers, 29 industrial customers and four wholesale customers.

Clinton said he is asking for TRDA to forgive the contracts so TASS customers do not have to carry the burden of local growth.

Utility consultant Roger Coffelt attended the meeting with Clinton and recommended implementing a fee for developers so they are paying equity into the system.

“The rate payers have been paying for years,” he said. 

The TRDA board appointed a committee of the three county mayors and Executive Director Ron Hammontree to discuss the issue and bring a recommendation back to the board.

mia.rhodarmer@advocateand democrat.com | 337-7101.