An overlooked four-sentence contract clause, not reviewed until after a vote by the Ballston town council to sign on as the largest customer of the future Saratoga County Water System, binds Ballston’s 1,858 water users to the town of Glenville water system as customers until as late as 2022.
A one-page amendment made in 2002 to a long-standing contract between the neighboring towns removed the release clause of 36 months’ advance notice by either party. Ballston Town Attorney Carlton Potts said the change was made to give the towns the flexibility to disengage in less than 36 months. However, no terms were put back in the contract stipulating how either town could end the business deal.
We knew we were under contract, but I had forgotten most of the parts of the amendment, Potts said in discussions with Supervisor Ray Callanan; board member Harold Townley; Wes Carr, a project manager on the county water system; and Spotlight staff on Monday, Oct. 29, at Ballston Town Hall. `In retrospect, I don’t know an attorney that wouldn’t change the wording on those terms, including Thomas Jefferson, but we are where we are today.`
Ballston officials said Monday night they are confident, however, they will be able to negotiate a release date with Glenville that will prevent overlapping contracts from two water suppliers. They also pointed out that the county water contract has no start date.
Potts has called to set up an initial meeting with Glenville to discuss the contract.
`The first step is communication between the town lawyers,` said Callanan.
While Glenville Mayor Frank Quinn agreed that the lawyers will work on the contract, he isn’t looking at a release date.
`We are definitely looking to hold Ballston to the contract exactly the way it is written,` Quinn said Monday night, Oct. 29. `We invested considerable money in upgrading our system and part and parcel of why we made those millions of dollars of upgrades was based on that contract and those terms. We’ve turned it over to our attorneys at this time and we’ll see where it goes.`
The contract with Glenville
The town of Glenville water district has been supplying Ballston with water since Sept. 21, 1971. According to records obtained by the Freedom of Information Law (FOIL), a subsequent contract was signed on Jan. 30, 1996, extending the purchase until Dec. 31, 2019, under which Ballston agreed to buy a minimum of 36.5 million gallons of water per year.
On Jan. 16, 2002, Callanan and Ballston town board members signed an amendment to the 1996 contract agreeing to delete the clause allowing either the water supplier, Glenville, or the customer, Ballston, to terminate the deal with 36 months’ notice. The amendment also extended the life of the contract to Dec. 31, 2022.
Potts said the contract was extended from 2019 to 2022 to match the loan terms for funding for upgrades to the system made by Glenville.
`This was done so that our agreement ran the length of the loan,` said Potts.
Town of Glenville Administrator Anthony Germano said Monday, Oct. 29, the town has spent as much as $3 to $6 million in upgrades to its water system to meet the growing needs of Ballston water users.
`What we did was make an investment for a good delivery system to the town,` said Germano. `Glenville is set up as a distributor of water, and we do it well.`
Germano also said the contract amendment would likely have been signed by Glenville officials to insure those costs were recouped.
`Do you think our board would have said, we’ll leave in the clause and give you a chance to walk out?` said Germano. `I think they’d say, ‘you’re locked in.’ It’s not unusual to have longer term contracts with other municipalities; you look to make these ties.`
Ballston users now pay Glenville $2.35 per 1,000 gallons for an average of 160,000 to 180,000 gallons per day, plus an annual equivalency charge to offset a portion of the debt service for transmission lines, water supply and treatment. Callanan said those charges are $108,000 for 2007 and will rise to $176,000 for 2008.
Board buys into water system amid protest
On March 6, 2007, Callanan and board members Townley, James Briaddy, Robert Boice and Mary Beth Hynes voted to allow Callanan to sign a contract with the county water system as its largest customer to date.
According to the contract, Ballston will purchase a minimum of 375,000 gallons per day for a period of 10 years at a start-up rate of $2.05 per 1,000 gallons from the date of initial delivery of water to the town through Dec. 31 of the following year.
About 70 people crowded town hall to ask the board to table the vote until the public had more information about why Ballston customers would benefit from switching water suppliers. Questions focused on the quality and cost of the county water, and whether the system was being built primarily in anticipation of the arrival of the AMD chip-fab plant to Luther Forest in Malta. The residents also asked why the nearly 2,000 water customers couldn’t be polled to determine their opinion, and why information wasn’t published in the town newsletter.
Before the board’s vote, Glenville’s Commissioner of Public Works Richard LeClair asked the Ballston board to sit down and look at the current contract, the costs and Glenville’s ability to deliver good water in any volume required by Ballston.
Official minutes from the Ballston town board meeting on March 6, 2007, show that LeClair `stated that the town of Glenville now has the capability of selling more water than the town of Ballston can store. The town of Glenville would be willing to meet with the town of Ballston and would be willing to help.`
On Monday, Oct. 29, LeClair said his attendance at the board meeting was the first and only time the Ballston town board allowed him to speak, and that he believed his presence was unwelcome.
`My kids played Little League with Townley’s, and when I went to the board meeting, he asked me why I was there and said I shouldn’t bother speaking, because it was a done deal,` said LeClair.
Potts said Monday that he began making calls to Glenville attorneys about two weeks ago to talk about setting up a `reasonable amount of time` for the contract to be severed. Callanan said contract discussions were not pursued with Glenville at an earlier juncture because the assumption was made that Glenville knew about Ballston’s intention to support the county system.
`It was no secret; every newspaper made it clear we were considering signing onto the system,` said Callanan.
Callanan and his board members said they based their votes on economics, given the fact that the county water rate would result in savings of $143,296 in the first year alone. They also stated the quality of the county water would exceed the Glenville-supplied water.
Callanan also said that every effort had been expended to seek out a town water source that would make Ballston independent of another system.
`We searched this entire town for an aquifer; it’s just not there,` said Callanan.
Townley said, as a lifelong town of Ballston resident, he had experienced problems with mineral deposits in the water clogging his showerhead and making him consider buying a water softener. However, no written or oral complaints are on file from Ballston water customers about Glenville water quality. Some residents spoke in favor of the quality of Glenville water during public comments at spring Ballston board meetings.
Neighboring towns have no discussions
As to why the towns failed to meet to review the contract, Townley said on Monday that the towns share a border but not a common mission.
`We’re towns that are connected, but we’re not on friendly terms,` said Townley. `If I went out and ran into (town of Glenville supervisor) Frank Quinn, it would be the first time I’d ever met him.`
Townley later pointed out that he was not trying to say anything negative about Glenville’s leaders.
Quinn did not return two phone calls on Monday, Oct. 29 for comment about the water contract amendment.
LeClair said while he had no power to negotiate individually with the Ballston board, members of the Glenville town council were willing to negotiate before the county contract was signed.
`No one ever contacted me about the chance Ballston might switch water suppliers, and I went to the (March 6) meeting to reason with them,` said LeClair. `They asked me on the spot to lock in a rate of $2.05, but I couldn’t make that promise then and there. If they had approached us, we would have worked with them and could definitely have negotiated the rate down to $2.05 to match the county rate. They never contacted us.`
LeClair said he was struck by what he believes was the unwillingness of the town of Ballston board members to talk.
`I found it insulting,` said LeClair. `If they called us up, we would have met them with open arms. Any time a neighbor is unsatisfied with our services, that hurts. There were no complaints about our water. I have friends in Ballston; it’s a shame we couldn’t work together as towns. There’s no Berlin Wall here.`
County system likely running in spring 2009
Ballston’s contract with the county system does not stipulate a definitive start date.
Carr, who was project manager through the design and permit phase of the Saratoga County Water System, said Monday he anticipated Ballston would begin obtaining water in 2009.
`There was no specific date attached, it was contingent on completion of the system,` said Carr. `Ground-breaking is in spring of 2007, and construction is expected to take 20 months.`
Carr said, to date, Ballston is set to be the largest county water customer, followed by the town of Wilton.
When questioned about whether the water authority had advised Ballston about terminating its current contracts with Glenville, Carr said there had been no discussion, and it was a `town issue` to deal with their previous supplier.
`I would assume they researched ending their agreement with Glenville to the best of their abilities,` said Carr. `If there was a stipulation they be tied in for five or 10 years, that would make it difficult. I don’t know the details of their contract. I would think those issues would have been resolved, and that they would have asked those basic questions.`
Potts seeks meeting with Glenville attorney
Potts said he began making phone calls to Glenville town attorney Eric Dickson about two weeks ago to discuss the contract, but declined to comment on whether he had received a reply. Potts said a meeting has not been set up to date, but he will continue to seek one.
`What happens when a contract doesn’t stipulate conditions for termination, it is implied by the law that a reasonable amount of time be agreed upon,` said Potts.
Potts declined to speculate what the courts could deem reasonable, and that he could not point to similar cases where a time period was established.
Potts said Glenville has not, to date, been officially notified that Ballston will stop buying water on or around spring of 2009. If the Glenville contract remains active for a minimum of 36 months, Ballston will be paying for water from two providers commencing in spring 2009.
If litigation becomes necessary for the towns to agree to a release date for buying water, all Ballston taxpayers would foot that bill.
`Legal expenses would come out of the general fund,` said Potts.“