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SWA board miffed by perceived backing out of city's agreement

The city of Dickinson may be backing out of a verbal agreement to partner with the Southwest Water Authority on industrial water sales and some members of the SWA Board of Directors are not happy about it.

Several members expressed disdain during Monday's regular monthly meeting with the fact that the city apparently has changed its mind about plans to share in costs and revenues from a SWA depot east of Dickinson.

Though there was no written agreement in place, Dickinson City Administrator Shawn Kessel told the board during its March meeting that the city was interested in "pushing water traffic to the (SWA) depot on the east side of town" in an effort to minimize semi truck and trailer traffic in Dickinson.

SWA President Mary Massad reported to the board Monday that the city had decided not to partner on the eastside depot.

"They changed their mind," Massad told the board. "It's as simple as that."

Though Massad said it was "understandable" why the city would want to keep charging industrial customers at its Broadway depot, board members James Odermann, Steve Schneider, Duane Bueligen and Larry Stang raised concerns over what they considered to be the city backing out of an agreement.

"It seems to me like they're double crossing us," Bueligen said. "According to how this all started out, we're seeing something different. I think what it comes down to is money."

For the month of March, the SWA sold slightly more than 7.3 million gallons of water from its depot off 36th Street Southwest near Roughrider RVs, about 400,000 gallons short of its projected sales. SWA's biggest customer at its eastside depot for last month was PowerFuels, which specializes in part in transporting water sourcing and hauling for the oil industry.

SWA charges $18.25 per thousand gallons at the depot, slightly less than what Dickinson is charging at its Broadway depot following a recent price hike.

Kessel said Monday evening that it didn't make sense for the city to partner with SWA, adding that it was more focused on plans for a new depot west of Dickinson to eventually divert semi traffic to the outskirts of the city.

"We were going down the path, for quite some time actually, of sharing and having joint ownership (of the eastside depot)," Kessel said. "When we started that process, it was about two years and we've experienced a lot of change in those two years. Based on today's economics and today's situation, it didn't make as much sense."

Referring to the vacated plans for a partnership as a "verbal agreement" only, Kessel said the city has made good on one aspect of the pact, which was to charge more at the Broadway depot in hopes that some customers would re-route to the SWA location for a better deal.

"We are charging more than they are," Kessel said. "We've fulfilled that portion of our agreement. I wouldn't say anything is absolute but, as of today, we're not planning to share (a depot)."

Massad stressed to the board the importance of working with all parties "for the greater good of everyone" and moving forward, calling the city of Dickinson a "good partner." Massad's words, however, did not resonate with everyone.

"My concern is that we've been talking about this with the city for over a year and for them to do an about-face is concerning," Schneider said. "I understand that we need to work together, but it's a two-way street. I feel like my trust with the city is gone."

While Massad and Schneider -- the board's Stark County representative --agreed that the authority's first priority is its resident customers, Odermann expressed concern over the fact that Dickinson and SWA will continue to be "in competition" for water sales.

"I understand that Dickinson has to look at its future and what's best for the city, but we have to do the same for us," Odermann said. "I'm concerned that they'll change their mind again and I think those are questions that need to be asked of those folks. I don't have the confidence that some others have because (the city) changed its mind. We were assured just 30 days ago that this partnership would happen."

Bryan Horwath
A Wisconsin native, Horwath has been covering news in the Oil Patch of North Dakota since 2012. Horwath currently serves as the senior agriculture and political reporter for The Dickinson Press and, despite the team's tendency to always let him down, remains a diehard Minnesota Vikings fan.
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