PRICHARD, Ala. (WKRG) – The Prichard Water Works and Sewer Board entered negotiation with two third-party companies to make upgrades to the system and pay off its debt to Synovus Bank.
Operating as Prichard Water Partners, Kohlberg Kravis Roberts & Co. partnered with Inframark, LLC to invest in PWWSB, saving the water board from falling into a receivership.
Mac Underwood, the water board’s operation manager, said he estimates the water board would receive anywhere from $50 million to $100 million if the deal is approved by the board; however, with a lawsuit hanging over the water board’s head, the low end of that figure would be just enough to take care of the unpaid bonds they owe to Synovus Bank. That would leave little wiggle room to pay for infrastructure costs.
“So, the default issue with Synovus bank would be solved,” Underwood said. “They’re also indicating that they would invest a certain amount of money into Prichard Water Works, the City of Prichard and the City of Chickasaw.”
In 2019, the water board borrowed $55 million worth of bonds from Synovus Bank, which Underwood said $25 million of that was immediately used to pay off previous loans. He said the water board used $7 million from the bonds to pay for meter checks throughout the city. The remaining $23 million, Underwood said, is still in a deposit at Synovus Bank.
“The proposal is for them to actually lease, manage, and operate the system to up to 30 to 40 years,” Underwood said.
The water board is in the process of drawing their 2024 Fiscal Year budget, which Underwood said would account for their outstanding debt. Whether or not the agreement goes through, Underwood admitted, point blank that water rates for citizens and customers would hike even higher.
“And that will mean water rates will go up. We don’t know how much, but citizens and customer will have to pay a higher water rate,” Underwood said.
Some customers are already paying over $1,000 a month for their water.
“We are the ones that have to pay for whatever decisions that they have made or are trying to make,” Severia Morris, President of United Concerned Citizens of Prichard, said. “We do not want the Prichard Water Works and Sewer Board to be over the management of this company any longer. We’d rather see it in receivership.”
Under the agreement, all PWWSB employees would be required to go through additional training for ‘safety continuity, personal growth, and further skills development.’