Attend The Fort Peck Rural County Water District Board Meeting On Jan. 30

Dear Editor,

The Fort Peck Rural County Water District Board deceived its customers in their recent Notice of a Public Hearing, regarding modification of the payment method for the System Development Fee, stating that: "The proposed modification will not impact current customers." This statement is completely false.

The Board's postcard misleads current customers into believing that there is no reason to concern themselves with attending the public hearing scheduled for Thursday, Jan. 30, at 6 p.m.

However, modification of the payment method for the System Development Fee will most certainly result in the District AND its current customers forfeiting the investment interest earned on $196,511 (a loss of about $10,000 per year) for its Replacement & Development (R & D) accounts. $196,511 is the upfront payment amount that Mr. Josh Kittleson is required to pay when Kittleson Ridge Subdivision is accepted into the District.

This Board is choosing to serve Kittleson's financial interests over the District's by not requiring his upfront payment and by allowing him to spread his payments out over fifteen years at a 3 percent interest rate (the current prime rate is 7.5 percent). The Water District is a public utility, NOT a charity for Kittleson. Mismanaging the District's/customers' funds is reckless and unethical.

A more accurate stated purpose for the hearing would be: Modification of the payment method for the System Development Fee for Josh Kittleson's benefit, prior to Kittleson Ridge Subdivision's acceptance into the District.

To help with your understanding, this is how the current System Development Fee payment method works: A person wanting access to public water on one single benefitted parcel of land (never before served by the District) is required to pay a System Development Fee of $4,500. That entire amount can be paid all at once or in a partial upfront payment of $2,933 and semi-annual installments of $170 for five years.

The System Development Fee was based on the cost of installing and maintaining the original water system infrastructure that was put in place 25 years ago, plus about $700,000 for improvements in 2015. The fees/funds are put in the SRF R & D account, which may only be used for the repair, replacement, maintenance and development needs of the District. The importance of having robust R & D accounts is to make sure the burden of maintaining the water system's infrastructure does not fall back on the District's customers unless and until that money runs out. Without Kittleson's $196,511 upfront payment, the fund will run out sooner than it should.

The District has only had two or three individual parcel requests (not in subdivisions) for public water access per year, which demonstrates that the modification is being crafted for Kittleson's benefit. (The proposed modification does not affect new customers purchasing a property that already has access to District water.)

The Board's whole rationale for proposing this move is because no other developer has had to make an upfront payment. Therefore, they say it unfair to Kittleson. But, if the Board had done its homework, they would know that the current payment method was intentionally created in order to be fair. The built-in expiration date requires that no later than 2031 the Board must increase the $4,500 per parcel rate to (1) keep up with inflation; and (2) reflect the increased value of the District's assets, which appreciate over time.

Kittleson has been on the District's Board since 2017, so he knew full well what his upfront System Development Fee would be when he chose to develop a 67-lot subdivision:

67 lots x $4,500 = $301,500

Of that total, Kittleson must make an upfront payment of $196,511. He can then make semi-annual payments on any unsold lots for five years. If Kittleson sells his 67 lots for $100,000+ each, he really only needs to sell two lots to cover the cost of his upfront payment.

The only reason that Kittleson was even able to develop a Subdivision with access to public water is because of the improvements, made ten years ago, making it possible. The District installed a 6-inch water line across Kittleson's farm costing $117,064. The 2014 loan invested in 4 new VFD pumps/controls and generator for $200,000 and upgraded the office building/pump station for $190,000. Kittleson Ridge Subdivision's 67 lots will have instant access to the entire infrastructure that the District has been maintaining – including $10,000 for air vacs on Kittleson's waterline. Given these investments that directly benefit Kittleson's subdivision, it is more than fair that he make the required $196,511 upfront payment.

It is the District Board members' job to manage the R & D accounts in a way that BEST serves the interest of the District, NOT Josh Kittleson. The future replacement and maintenance needs of the District are never on a Board meeting agenda and are not being considered now. For example, the Board has made no attempt to replace its 20-year-old meters (there are over 300 of them) that the District's Regulation 10.2 required them to do two years ago!

Kittleson has stacked the odds in his favor in what should be a five-member Board. There are multiple conflicts of interest on the Board and Kittleson has conveniently made no attempt to fill a Board vacancy since July 31, 2024 so as to not upset that dynamic. Vice President, Parpart's son works for Kittleson, and Treasurer Yeoman grazes cattle on Kittleson land.

Going forward, the District will be responsible for maintaining the water lines that Kittleson himself installed and for providing the stagnant water blow-offs on dead-end lines. The District won't even get any paying customers on those lots until homes are actually built.

This Board should be forced to prove to its customers how modifying the payment method for Kittleson is in the best interests of the District and why this is not a conflict of interest.

Please attend the hearing and make your voice heard.

Sincerely,

Mary Kaercher &

Debra Steffani

Fort Peck, Mont.