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Halleck disappointed EL nixes deal on water


October 7, 2012
Morning Journal News

LISBON - Count Columbiana County Commissioner Mike Halleck among those disappointed by East Liverpool's decision to back away from a deal that would have resolved the Buckeye Water District lawsuit.

Halleck was referring to last week's news that East Liverpool wants an extra $668,000 in addition to the $5.9 million the city had agreed to accept to settle its lawsuit against the BWD.

"I think the judge has been more than patient," he said. "I don't know why they are doing it. Maybe they want to run the interest up. That's the only possible reason."

Halleck was referring to the fact the longer the dispute goes unresolved East Liverpool can lay claim to $699 per day in accrued interest. The next hearing on the matter is scheduled for Dec. 10, which would add another $57,000 in interest on top of the $1.7 million in interest East Liverpool already claims it is owed.

"When you got that kind of interest out there, why would you want to settle?" Halleck said.

The interest is on the $4.8 million court judgment East Liverpool was awarded after winning a breach-of-contract lawsuit against the BWD when the BWD quit buying water from the city. The interest accrued as the BWD exhausted its appeals.

The BWD in May accepted East Liverpool's offer to settle the dispute for $5.9 million, but the city later began to back away from the deal, first claiming it wanted the U.S. Department of Agriculture to sign off on any proposed settlement agreement even though the USDA was not a party to the lawsuit. Then on Sept. 12, East Liverpool's attorney indicated the city wanted another $668,000.

Commissioners are concerned because they are co-defendants to the lawsuit, and, therefore, also on the hook should the BWD fail to pay the judgment. The judge determined the county was still legally part of the agreement to purchase water from East Liverpool despite having turned over the county water district to the BWD nearly 20 years ago.

To help resolve the dispute, commissioners agreed in May put up $1.5 million in county funds to help the BWD come up with the $5.9 million needed to pay East Liverpool, with the BWD required to repay the county. East Liverpool accepted the county's offer but in doing so retained its legal claim against the county.

Halleck is disappointed with some of the officials involved in reaching the tentative deal. "We had a deal, on more than one occasion," he said.

Halleck estimated when the bill for legal fees comes due that East Liverpool and the BWD combined will have spent more than $500,000 in attorney fees on the out-of-county law firms that are representing them, and the meter continues to run until the dispute is resolved.

In related news, the BWD filed a motion in county Common Pleas Court disputing East Liverpool's calculation of the interest owed, saying the city used incorrect interest rates during certain periods while the BWD was exhausting its appeals.



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