TAWAS CITY – For 10 months, meter readings in Tawas City and East Tawas were in question, and the council members from each municipality discussed the issue at their respective meetings on Oct. 4.

When Tawas City officials met, it was explained that there are two master meters in the Huron Shore Regional Utility Authority (HSRUA) system which meter the water coming to Tawas City.

City Manager Annge Horning noted that one is located on Cedar Street/West Westover Street at the Tawas City/East Tawas city limits. The other is located on US-23, just north of O’Reilly Auto Parts, also at the city limits.

“It was discovered that the US-23 meter quit reading sometime in May 2020 and it didn’t get repaired until March 2021,” Horning stated.

As both she and Mayor Ken Cook pointed out, the accuracy of the meters is paramount to the operation of the authority so that they know how much water was used by each entity, as the municipalities’ contributions to the HSRUA budget are based on the usage which goes through the meters.

As reported, HSRUA provides treated water to East Tawas, Tawas City and the townships of Oscoda, AuSable and Baldwin. This issue, however, involves only East Tawas and Tawas City.

Horning explained that the regional manager for HSRUA reviewed 10 years of history of meter reads, usage, billing history and accountability for both Tawas City and East Tawas, to make recommendations on what the estimated reads should be for each city.

A spreadsheet was provided to officials, which summarizes the information with the recommended estimated usage. Both 10- and five-year averages and accountability, labeled as percentage difference were included, because both cities have made improvements in recent years to enhance accountability.

Cook said there are a lot of meters between the different units of government, and every now and then the meters do fail, be it as the result of age or other incidents.

Cook, who serves on the HSRUA Board as Tawas City’s representative, said that they were in the process of replacing meters. Some were done a few years ago, more were replaced last year and HSRUA was scheduled to continue the replacements this year.

He said that there were two problems brought to their attention which occurred near the same time, one of which involves the spreadsheets that all of the municipalities receive each month. 

As reported, it was last fall during the HSRUA budget process when it was discovered that there was an error in the formula on the spreadsheet. It was ultimately corrected and was retroactive back to when the error started occurring. 

“So that compounded the problem,” Cook said. “The other one that was not corrected, until the winter time this year, was the meter by O’Reilly’s had failed,” he continued.

“I’ll be honest, I didn’t notice that the numbers were changing,” he said, adding that others who receive these same numbers, including East Tawas, also didn’t notice.

Aside from that, he said he thinks the real failure was on the part of the contract administrator.

Cook said it’s caused a problem because they had to estimate the number of gallons which went through the meter.

He and Horning also noted that another difficulty with this, is that it took place during the COVID-19 pandemic. Tawas City has a number of large users on the system – such as Walmart, the Iosco County buildings, the Tawas Area Schools properties and Ascension St. Joseph Hospital – and the water needs for some of these entities changed during this period.

For example, Horning said the schools and several factories were shut down during the pandemic; people weren’t traveling so the hotels didn’t have the use that they typically do; and the hospital was only doing emergency services. So the use dropped off for a lot of these entities, for at least a couple of months.

This is why, with the spreadsheet of the estimated usage, she said they couldn’t go back just one year. They had to go back further since the first several months of COVID resulted in quite a bit less usage than what it has been historically. “So it happened at an unfortunate time, when there’s a lot of other factors that come into play here.”

Horning said that when Catherine Winn – the regional manager at F&V Operations, which operates HSRUA – prepared the estimates, she tried to be fair and look at not just the average usage, but also accountability.

For example, Horning said that in the winter there can be water main breaks, which has an impact, as do general leaks. “In October and May we flush hydrants, and that affects our accountability, too. We try to meter it as closely as we can, but when you’ve got that many gallons going out of a hydrant, it’s not always easy to get it accurate.”

Winn’s estimates are based on a 10-year average. Horning also prepared the five-year average for the council to see, because the improvements to the water system made by Tawas City and East Tawas in the last few years have helped with accountability.

When Mayor Pro Tem Brian McMurray asked about the dollar impact, Horning said it’s already been adjusted in the budget, so there’s not going to be a dollar amount.

But Cook said that if the numbers are wrong and the proration between the two municipalities is incorrect, then there could be a dollar difference.

When looking at the spreadsheet, he referenced the month of September 2020. The 10-year average shows 7,057,900 gallons listed for HSRUA usage. The F&V estimate for that month was 7,221,000. Customers were billed for 6,616,431, resulting in a 91.63 percent difference, so there was a loss of about 600,000 gallons.

He said that losses aren’t uncommon, reiterating that there are leaks, breaks, hydrant flushes and so on. So it’s rare to hit the numbers exactly.

As for the figures on the spreadsheet, Councilman Ed Nagy asked if the amounts billed to Tawas City are going to change at all.

“Those are actual.” Horning said.

“So in essence, the customers are not going to be charged anymore?” Nagy asked.

“Correct. They’ve already been billed and paid,” Horning answered.

She that all of the numbers are actual except for one month where they had to estimate, because with COVID restrictions, they didn’t have people go out and read meters that month. “But other than that, everything is accurate and when we did read again, it caught it up to an actual read. So, no, it will not impact our customers.”

Cook said there are two locations where water comes into Tawas City – on West Westover Street and US-23 – and that they know what the gallonage is coming in. There’s nothing wrong with the reads on Westover, and the one which did fail is typically not where most of the water flows through.

Horning added that it’s not as though only the businesses on US-23 pull from the one by O’Reilly’s. “Because there’s loops in our system, they could be pulling from the Westover meter, too. So it’s not like we can narrow down these reads and this is what that usage was. Our whole city could pull from either one of those pit meters.”

“So Catherine, our contract administrator, went through and did the best she could to try to apply some element of logic and sanity to the estimates,” Cook said. The question is, are those good estimates and can they be depended on? “Are we in a position we want to somehow dispute these numbers, or are we willing to accept these numbers and just move forward?”

He also noted that neither Tawas City nor their department of public works caused this problem.

Councilman Mike Russo said they could have somebody  else do it and it’s going to be slightly different, but he thinks it’s still going to be well within the range they were discussing that night. “And even then, it’s still guesswork.”

So, in his opinion, there are two things to take away from this and one involves whether they are still upgrading meter pits. “If we have more to do, we’ve got to make sure they get done.”

Second, in light of this problem, he asked if there is anything in place which is going to be some kind of identifier that notes when there is a problem – as opposed to letting it languish for 10 months.

According to Cook, the HSRUA Board decided to advance their meter replacements and, rather than doing the ones which were scheduled for the next two or three years, to change them this year.

As of the meeting, he said there were one or two which were waiting for parts, but that these will be finished. “In fact, as we speak, those might be done yet.”

In response to Russo’s second question, Cook said it is human error. “And obviously it starts at the top with the contract administrator and their staff.”

He said that all the municipalities also need to be looking at the numbers that they’re given every month, and be prepared to ask questions if something looks off.

The problem with that, he said, is that it requires having last month’s report and the current report. And when the board members sit down for their meetings, “we look at what we’re given for today, and we don’t look at what we were given last month.”

Cook added that this is why they hire professionals. “And the problem comes there.”

McMurray said he would think that, in general, having a meter that’s out for an extended period of time and without anyone being aware would fall on the administrator of the facility, and that there should be processes in place to catch these things earlier on.

“And we all know that meters break. That’s a given. It’s going to happen some time,” Councilman Chuck Klenow said.

He remarked that his concern is more about the fact that the administrator did not catch this as quickly as it could have been.

“I agree with you, as individuals, we get the report we’re going to look at the current month; we’re not going to go back and compare it to the previous month,” he also said, in reference to Cook’s comments.

As for the other issue, Klenow wondered how someone had the ability to change the formula on a spreadsheet and have that go unchecked. So, he said he thinks that the problem goes back to the administrators, and that the city is basically going to have to accept the proposed estimates of what it is. “But we’ve got to be able to prevent it from happening again. And those are simple, very simple fixes. You lock the spreadsheet and you put in a calculation to compare prior months, prior quarters, whatever you want to do.”

As for the problem at hand, Cook said that they know how much water came into Tawas City and East Tawas. But the question becomes, how much was used in one city versus the other.

Councilwoman Jackie Masich asked that if all the other meters were working, and they know how much came in and they know how much went to the other meters, how is it not just a simple subtraction problem to know what came through the one meter that wasn’t working.

Cook said there are the meter pits on Westover and US-23, and that water is coming from Baldwin Township into East Tawas. It then flows down through the pipes and crosses through one of the two  meters, into Tawas City. “One of those two meters was not reading. So they know how much water came into the Tawases.”

What is not known with the one meter, he said, is how much stayed in East Tawas, versus going into Tawas City.

Russo said that this is because they can have flow reversals and, as Horning advised, it’s looped. There can be multiple parallel paths where it can go back and then come back the other way, through the non-reading or the reading meter. “It’s an equation with too many variables, is what happens.”

Referencing the spreadsheet of estimates again, Cook cited the month of June as another example. The 2020 estimated HSRUA usage for East Tawas at that time was 6,249,000, and it was 8,195,000 for Tawas City. While it is known how many gallons came into the two cities, the proration between the 6,249,000 and the 8,195,000 is where the discussion comes in.

McMurray asked what the administrator’s perspective was, on why they didn’t catch the faulty meter sooner.

“I can’t answer that, Bryan. Have we had discussion? Yes,” said Cook. “Human error.”

Masich made a motion to accept the estimates of usage being proposed by the contract administrator, which was supported by Russo and passed 6-1. Although he didn’t specify why, Nagy cast the dissenting vote.

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