Some in Lake Osborne upset over $1 million water deal with Lake Worth
LAKE WORTH — In 2014, Lake Osborne Waterworks, a private utility provider, sued Lake Worth, saying it was being forced to pay too much for water.
Lake Osborne bought water from the city and sold it to 466 homes in Lake Osborne Estates, a single-family-home community west of Interstate 95 near Sixth Avenue South in unincorporated Palm Beach County.
The lawsuit argued that the city charged Lake Osborne Estates as if it were a multi-unit user, which is charged twice as much as a single-family user. For instance, 10,000 gallons a month would cost a multi-user $127, but would cost a single-family user $58.
Fast forward three years: Lake Worth is buying the water company for $1 million and planning $1.8 million in capital improvements over the next three years.
City commissioners approved the sale in August and it becomes final today.
“Our crews are right around the corner,” said Brian Shields, Lake Worth’s director of water utilities. “So if there’s a break in the system, we’ll be there immediately to make repairs.”
Plus, Shields said homeowners will be receiving new water meters and water mains. He said residents have had issues for months related to water main breaks and water quality, and have been begging the city to take over.
But there are residents in Lake Osborne Estates who want to block the deal, saying their monthly $50 rates are too high
and that the city is taking advantage of them.
“Lake Worth is seeing this and said, ‘Wow, people are willing to pay that high of (a) rate,’ ” said William Coakley, vice president of the Lake Osborne Estates Civic Association. “The city is going ‘Why should we reduce the rates? And if we grab the utility, the lawsuit goes away.’ What this gets to at a higher level is a state-created feudal system.”
Shields disagrees. “They’re not involved in the transaction,” he said. “It’s the city of Lake Worth and Lake Osborne Waterworks, so unless they’re making a counteroffer, I don’t see where they’re coming from.”
As for the high rates, which Coakley said are about 40 percent higher than what Delray Beach residents pay, Shields said every utility has a different rate, depending on its rate structure, the size of the utility and number of customers.
For each of the next five years, Lake Osborne Estates residents will be charged $2.75 per year to help pay for the capital improvements, Shields said.
Marilyn Davis, another Lake Osborne Estates resident, said that once the deal is official, the community will lose its ability to negotiate its water service with another company.
“Lake Worth Util- ities is not governed by the Public Service Commission,” Davis said. “We will lose our designation as an autono- mous water territory we have right now, meaning we’ll be forced to do whatever the city wants to do with our water. Lake Worth is just going to make money off us and we’re left hanging in the wind.”
Davis also is not pleased with how her civic association has responded.
“We were told that if our association filed an oppo- sition to at least delay the sale so we can gather all of our facts ... (the city) would have to honor that, but then our association says they’re not responsible for anything like that, and I said, ‘What?’” Davis said.
Carlos Serrano, president of the Lake Osborne Estates Civic Association, said there has been some heated discussion among some residents partially caused by misin- formation that has misled them to believe they could approve or disapprove the sale.
“We had no such mecha- nism,” Serrano said. “If we had, the issue would’ve been put to a vote.”
Serrano said he believes the sale will be good for the neighborhood.
“Lake Worth will be able to make investment in phys- ical infrastructure that the prior water service provider was unable or unwilling to make,” Serrano said.