Last week’s Beachcomber featured an opinion piece by Ward Carson, a Burton resident, about the Burton Water Cooperative’s (BWC’s) proposed plan for financing the purchase of, and major upgrades to, the Burton water system.

BWC’s plan is based on the results of a comprehensive financial model that considers many input variables.

Ward has developed a variation of that financial model and proposes that we can finance the project with a higher member contribution (compared to BWC’s current proposal) and no debt. His model depends on spacing the system upgrades over a longer span of time and apparently other differences from the BWC model.

The finance committee of the BWC, made up of Burton resident volunteers (including Ward), has been working for many months on the BWC financial model, which incorporates the most recent analyses of projected income and expenses, especially those required for the front-loaded capital improvement plan that the Burton community has requested.

To more quickly upgrade the system and improve the system’s capacity for fire suppression, all members of the BWC finance committee but Ward favor a mix of affordable initial member contributions and the use of a low-interest fixed-rate USDA loan. Using our model, we estimate that reliance on rates to pay for the upgrades, as Ward has suggested, would delay the upgrades for 15 to 20 years and increase the member contribution substantially.

When developing the BWC financial model and plan, the Finance Committee followed five core principles:

• The assumptions for projecting revenues and expenses are solid and well-supported
• The ‘capital stack’ (member contributions, debt, grants, etc.) can be obtained and is stable over time
• The plan has a predictable and reasonable impact on water rates
• The cost for someone to join the co-op and obtain water service is not an unreasonable financial burden and can be paid over several years, if necessary
• There is cash available to cover reasonably projected capital needs over time (i.e., first 20 years) and balance leading into the next 20 years.

The committees’ work has been done openly and with broad community input. BWC has held several online presentations to present our work-in-progress, has a website and forums on it, received community feedback, and made adjustments. Community support and the contributions of our neighbors have helped us get where we are now.

Currently, all the BWC committees, the entire board of directors, and the vast majority of the community believe the use of a USDA loan upholds the core principles and achieves the end goal of financing a community-owned and operated water system. We will continue to make every effort to work collaboratively with all members of the Burton Community to consider new information and strengthen the project. In addition, the community will have the opportunity to vote on the final financing proposal before we finalize the purchase.

Burton residents are encouraged to share their perspectives with us at info@burtonwater.org and by joining the next fireside chat in May. Check the website burtonwater.org for more details.

William Shadbolt and Lisa Fitzhugh are, respectively, the president and vice-president of the Burton Water Cooperative’s board of directors. They have co-written this commentary with the board’s other officers, Norm Seethoff, Dawn Kerber, James Culberson and Brian Lee.