NASELLE - The Naselle Water Company, in an announcement sent to water customers and shareholders on May 16, made the following statement:

"As of today, we have reached our limit of allowable connections. We are currently working with the Department of Health and the Department of Ecology to increase the number of allowable connections and are awaiting their response. Until such time, no additional connections can be made, except those who have already purchased their share and are included in our numbers.

"Applications for connections may still be made and will be issued on a first come basis when we receive the approval for the additional connections. Our next water meeting is June 6 at 7 p.m. at the Naselle Water Company (NWC). The public is welcome."

This announcement to stop any further connections to the water supply has caused some concern among area landowners and developers, homeowners, prospective builders, and real estate people. Perhaps of even greater concern than the moratorium on new connections should be the aging condition of much of the water company's infrastructure and the impact that those aging pipes will have on all water company patrons and the availability and cost of that water.

Buddy Strange, a trustee on the Naselle Water Company Board for the last 10 years, provided information on the reasons behind the announcement which has halted new connections. Strange commented that he, as well as other board members and staff (with Regan Wirkkala doing the majority of the work), have been working on this issue steadily for over a year up to the point where they now are.

Strange said, "The Naselle Water Company has been working with the state for a better part of a year and $20,000 to obtain additional water connections. If the plan, currently at the state, is approved we will get an additional 70 connections. There is also the possibility that we may not get approval for any additional connections. The short answer (to the water supply problem) is "leaks." NWC produced 75,508,000 gallons of water in 2006, of this total 40,540,637 gallons went through the customer meters. The other 46 percent or 34,967,363 gallons were lost in leaks. The state allows NWC 73 million gallons per year under our water rights. As you can see we exceeded our rights by 2.5 million gallons. Our current water rights is a whole other story."

The reason for the water line leaks is mainly due to the aging infrastructure in the existing water supply system. Some of the water mains date back to 1931, over 70 years in age, and well beyond their predicted life span of 20 to 30 years. The "new" mains which were installed in the 1996-97 upgrade, have now been in use for about ten years.

Strange provided, "a little history" primarily of the system rebuild of 1996-97: "1986 Clean Water Act made NWC out of compliance. That coupled with the shortage of water during dry spells prompted the State Health Department to place restrictions on expansions and additions of customers. In addition the Health Department required mandatory compliance with the act. NWC borrowed $1.5 million at 4.5 percent interest for 40 years for work that was completed in 1996-1997. Main facility on Lane Creek Slow sand water filter treatment plant completed: (three 1,600-square-foot filters), Control room and pipe gallery, 462,500 gallon steel storage water tank (plus existing 95,000 gallon tank), two water intakes on Lane Creek and O'Connor Creek, one water intake, about 1-1/2 miles above the Naselle DOT building. This water will flow in a reverse direction to the Lane Creek facility. NWC installed or replaced: 15,115 feet of 6-inch water main, 23,488 feet of 8 inch water main, 6,184 feet of 10-inch water main. At that time Naselle Water Company placed meters on all accounts."

Strange explained further, "Once accounts were metered and the data collected, it became clear that NWC needed desperately to replace the remaining distribution lines. The problem was that our rates did not and still do not support any additional loan payments. In addition the state is is requiring NWC to reduce its water loss to 10 percent by 2016. No matter how we look at it our day of reckoning is coming. Although NWC is aggressively pursuing leak detection and repair we are fighting a losing battle.

"NWC has applied to the State Revolving Fund for two low interest loans (1 percent). The first loan is to replace approximately 14,000 feet of aged water line. This $602,158 loan application is for 20 years and would cost each customer approximately $5 a month. The second loan that NWC applied for is to refinance our 4.5 percent $1.5 million 40-year loan to a 1 percent 20-year loan. This loan, if approved, would save our customers over $800,000 of interest payments over the life of the loan with the monthly payment remaining substantially the same. NWC will have to wait until the fall of 2007 to find out if either of our loans have been approved. If approved the monies will be available in early 2008. NWC was formed in 1931 and has seen a lot of changes in 76 years and will face some interesting challenges in the months and years to come."

Strange continued, "The following is what I know to date about our water rights. Prior to 1996 Naselle Water Company had water rights of 1 CFS (cubic foot per second) or 724 AFY (acre feet per year). After the DOE (Department of Ecology) got through with us in 1997 our water rights were reduced to 224 AFY.

? On Dec. 21, 1995, Naselle Water Company applied for a permit to appropriate water for municipal supply to the community of Naselle from O'Connor Creek on application number S2-29335.

? Under the provisions section is stated "Prior to issuance of a final water right certificate under this filing (NO. S2-29335), Naselle Water Company Agrees to:

1. Submit an application for change on certificate NO. 4680 (Lane Creek), to update the place of use on that water right; and

2. Submit to the Department of Ecology a map of the NWC service area, as approved by the Department of Health in a water system comprehensive plan.

"On Oct. 10, 1996, Naselle Water Company filed an Application for Change of Water Right to change the place of use previously authorized under Surface Water Certificate 4680. The requested change would alter the area served by the Naselle Water Company from within sections 3, 4, 5, 8, 9 and 17 Township 10 North, Range 9 West, to "The Area Served by the Naselle Water Company."

? A "Report of Examination" was mailed to Naselle Water Company. In this report the DOE recommendation was to change the point of use to "The area served by the Naselle Water Company."

? Under the provisions section is where the DOE changed our water rights from 1CFS to 224 AFY

? A separate document said we had the right to appeal the "Report of Examination" for a period of 30 days.

? Naselle Water Company did not understand the changes to be anything other than what we were led to believe as a "point of use" change only.

? Since these changes were mailed to the Naselle Water Company, Wilson Engineering, who was Naselle Water Company's liaison, was also left out of this loop.

? Naselle Water Company never discovered the change of our water rights until 2006 when Wilson Engineering was hired to help Naselle Water Company submit a SWSMP (Small Water System Management Plan) to the state to increase the amount of connections available.

" Nowhere can I see where Naselle Water Company did anything but comply with the DOE's request to update the place of use. The DOE clearly did not divulge its intent to change NWC water rights in the provisions laid out by the DOE in requesting NWC to update the place of use," Strange concluded.

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