Utility fears cost of pumping violations

Drought-plagued Tampa Bay Water, concerned about its credit rating, seeks relief. By JEAN HELLER

© St. Petersburg Times, published February 24, 2001

CLEARWATER -- It is inevitable now. Tampa Bay Water will violate the permit that limits how much water it can pump from the ground.

It isn't even a question when the violation will occur: between next Tuesday and March 10.

There is a question, however, about the short-term and long-term implications for residents of Pinellas, Hillsborough and Pasco counties and the cities of St. Petersburg, Tampa and New Port Richey, the governments that get their water from TBW.

Fines could run up to $10,000 per day per occurrence. If the bill should run into the millions of dollars, TBW members might have to raise water rates to pay it.

TBW has an excellent credit rating, which means lower interest rates when financing new water projects. Officials said Friday that they fear a breach of the pumping permit could jeopardize the credit rating, making projects more expensive, another factor that could affect water rates.

Last December, Tampa Bay Water asked the region's water regulator for relief from the permit violations before the violations actually occurred. Now it appears the request will be denied.

The board of the Southwest Florida Water Management District, which meets Monday, will not vote on relief for TBW.

"It would be the March meeting at the earliest," said Swiftmud spokesman Michael Molligan.

The violation will occur because of the drought, now more than 2 years old.

When the permit was issued, it was envisioned that Tampa would never need more than 5-million gallons of water a day from TBW because it obtained its supplies from the Hillsborough River.

But the river is running at record lows, and TBW has been delivering as much as 40-million gallons daily to Tampa.

TBW asked Swiftmud to consider several options to avoid the permit violations. They included discounting the amount of water it pumped daily by the amount delivered to Tampa beyond the 5-million gallons a day.

Another was to temporarily raise the permit limit. As written, it tops out at 158-million gallons per day, averaged over a rolling 36-month period. TBW suggested raising the cap temporarily to 164- million gallons a day.

There is public sentiment not to do this because pumping is supposed to be going down, and once the cap is raised, some fear it won't be lowered again.

Swiftmud officials also would prefer that the member governments of TBW take local actions to promote conservation and cut consumption. Such actions have political ramifications, and it is always easier if the other guy gets blamed.

TBW officials are exasperated by the situation, arguing that permit violations are not willful. And state law requires that regardless of external pressures, TBW must deliver the water necessary to protect public health and welfare.

"I started going up there and reporting on this situation six months ago," said TBW's general manager, Jerry Maxwell. "I told them of the danger that we would violate the permit. In December, we asked for action. Then I see the agenda for the meeting Monday, and the TBW portion has been reduced to a discussion item only.

"The financial markets are watching everything we do right now. Right now, we can say we are on time with everything and on budget and have never violated a contract. But busting the permit will be a violation of a contract" and could affect TBW's credit rating, Maxwell said. "This is not a good place to go or a good time to go there."

Molligan said Swiftmud doesn't plan to take action on TBW's request because it needed additional information to evaluate the issue.

"We didn't get it until early this week, which wasn't enough time to evaluate it and come up with a presentation and recommendation for our board," he said.

But Michelle Robinson, spokeswoman for TBW, said the delay is Swiftmud's doing.

"We made the formal request for relief on Dec. 21, and they didn't ask for additional information until Feb. 12," Robinson said. "That's eight weeks."

http://www.sptimes.com/News/022401/news_pf/TampaBay/Utility_fears_cost_of.shtml

-- Martin Thompson (mthom1927@aol.com), February 24, 2001