City to seek money to study selling water

The council’s action follows on the heels of last week’s recognition at the American Water Works Association’s 2013 Annual Conference and Exposition in Denver. International Falls’ water tied for second place in the best-tasting drinking water contest held during the conference.

Judges there told Bruce Wilson, International Falls chief operator at the city’s water plant, that the water from the Icebox of the Nation is good enough to sell or use for a product.

Councilor Gail Rognerud and other council members said the timing following the award is right to look for a grant to fund a feasibility study on the potential to market and sell water.

And, she said, the timing is right to create jobs in the process. “In the current situation (with the local paper mill to eliminate 265 jobs by October), we should be exploring everything we can to create jobs,” she said.

The council directed Shawn Mason, city economic and community development director, to search for a grant that would fund the study.

Falls Mayor Bob Anderson wondered whether the study should be conducted by the city or private enterprise that may benefit from selling water.

Rognerud said the city owns the plant and the water and ought to get the process started by finding a grant to fund a study. Then, she said, private businesses could step into the process.

Councilor Paul Eklund agreed, saying searching for a grant is a good place to start. “We’ve been winning awards for several years,” he said. “We need to see if we can use that to sell water.”

International Falls earned a spot at the national competition in September when it took the top prize in the “Best in Glass” water taste-test championship at the Minnesota AWWA state conference in Duluth.

Mason also agreed that the timing is right, just as several federal and state elected officials have pledged to do all they can to assist the community in recovering from the anticipated job loss at the paper mill.

Mason said she would ask granting entities — government and non-profit — that have economic development as their mission to fund the study.

“It’s all about feasibility and cash flow,” she said of selling water.

The council asked Mason to include other economic development and business organizations in the search for a grant.

In other business, the council agreed on a 2-1 vote to enter an agreement with Compensation Consultants Ltd, Cloquet, to serve as a subcontractor to handle health reimbursement arrangement accounts for the 34 eligible participants.

Anderson voted against the proposal. Councilors Cynthia Jaksa and Pete Kalar were absent from Monday’s meeting.

Eklund said employees from three groups, totaling 34 people, are eligible for HRAs. The fees, estimated at $4.40 per person, would be paid by participants.

The HRAs were established for the council in September 2006. At that time, health insurance coverage was discontinued for all council members and instead a $500 per-month HRA effective January 2007 was established.

In recent years, HRAs were offered to union groups and a post-employment group.

The money is placed into a fund, with interest on the fund balance paid to the city. Claims for approved medical expenses are made following Internal Revenue Service guidelines.

Eklund, chairman of the city’s Human Resources Committee, said the city would serve as administrator and the subcontractor would keep records for the accounts and ensure that the city is in compliance with health care reforms taking effect in 2014.

Anderson said he would not participate and wondered if that would impact the service fee amount paid by other participants, but Eklund said the per participant fee would be adjusted as a result.

Anderson told the council he disagrees with the $6,000 HRA per year paid by the city into the HRA for each member of the council. Other cities and businesses don’t provide that much money for an HRA, he said.

He suggested the council reduce the HRA by the $6,000 per year for which he is eligible and place it in the permanent improvement account or fill some other need with the money.

“I think $6,000 is way out of line,” he said.

In other business, the council agreed to meet in special session at 4:30 p.m. June 24 to hear the second readings of ordinances that call for the purchases of an ambulance at $128,931 and a dump truck at $143,621.

Falls Police Chief Mike Musich urged city organizations to contact him at least two months before an event that requires closing of a city street. He said the city and state process used to close the street takes time.

Eklund noted that the vacant city administrator position is scheduled for discussion at a June 26 Human Resource Committee meeting. The administrator position was left vacant in March with the resignation of Rod Otterness, who left to take a city manager job at Union Gap, Wash. Pay for the position ranges from $61,00 to $85,000, according to the advertisement. Deputy Administrator Betty Angstrom is serving as interim administrator.