Water users could be on the hook for hundreds of thousands of dollars in legal fees. The Greater Vernon water utility is budgeting $300,000 for legal costs relating to the arbitration process that could see the City of Vernon leave water distribution. “We have to know we are covered. The $300,000 is esitmated based on discussions with the lawyer,” said Mike Macnabb, BX-Silver Star director. However, Vernon director Wayne Lippert claims the expenditure is unnecessary. “The regional district has thrown out big costs for staff and legal costs before and they’ve been unfounded,” he said. “It’s partially a scare tactic.” The utility’s legal costs will be covered by water rates, meaning revenue generated in Vernon will be used to pay for a legal case against the city. “Vernon has 72 per cent of the residential customers so it will be picking up a large chunk of Area B and C’s legal costs,” said Macnabb referring to his area and BX-Swan Lake. That does not sit well with Lippert, who says Areas B and C — as partners in the function — should pay their own fees just as Vernon and Coldstream are doing. “They can expect a challenge on the assumption they are making,” he said. “Maybe they need a legal opinion to show who pays.”
It’s not known how much the North Okanagan Regional District, through the water utility, has paid in legal fees related to the case so far. But the city says its bill, to date, has been about $30,000. “We have not put any extra money towards arbitration,” said Lippert. The city pays the bills out of a fund set aside to cover all legal expenditures, not just for the water process. The fund’s budget is $225,623 for 2010. Expenses aside, Lippert says withdrawing from water distribution could save Vernon residents $3 million. The other partner in the utility, Coldstream, had about $44,000 in arbitration-related fees in 2009 and $90,000 is proposed for the 2010 budget.
Lippert believes concerns about water distribution can be resolved and the utility maintained. “If they’re making a big noise about costs, all they have to do is sit down at the table and talk,” he said. Macnabb is also pushing for arbitration to be abandoned. But until that happens, he defends the potential legal costs. “We have to budget for the worst case scenario and hope for the best,” he said. Pressure from other NORD politicians is being placed on the Greater Vernon jurisdictions to settle its dispute outside of the courts. “How can we feel good about how we represent ratepayers when we’re squandering money?” said Will Hansma, Spallumcheen director.
No comments:
Post a Comment