Heights Council: Keep Water Negotiations Going With Norton Shores, Not Fruitport

Andrew Trzaska | June 11, 2012

In a surprise vote on Monday, the Muskegon Heights City Council instructed its city manager to discontinue water service negotiations with the Fruitport Township but continue discussions with the City of Norton Shores.

Over the last few months, key players from Fruitport, Norton Shores and Muskegon Heights have been negotiating over a continued water contract.

Turmoil surround the contract truly started in April 2011, when the Fruitport Township sent an official notice to the City of Muskegon Heights indicating they would be terminating their contract for water with the city in four years, the minimum acceptable time frame in their current contract.

It is generally agreed that by the current contract, if one player in the agreement opts to leave, the whole agreement is dissolved. This left Norton Shores looking to either renegotiate with Muskegon Heights or find a new supplier.  Fruitport’s notice has set them, Norton Shores and Muskegon Heights on unique paths toward finding new suppliers or customers, with April 2015 as the zero hour.

Fruitport and Norton Shores opted to enter discussions with the county’s other major water producer, the City of Muskegon. Those negotiations have since fallen apart.  Norton Shores and Fruitport are now exploring the creation of a regional water authority, but Norton Shores has continued negotiations with Muskegon Heights.  Fruitport has been present in those negotiations as well.

Muskegon Heights City Manager Natasha Henderson and Mayor Darrell Paige have spearheaded negotiations. Muskegon Heights’ finalized proposal was sent to Norton Shores and Fruitport in April.

Henderson painted Fruitport’s continued presence in negotiations despite their termination notice as a courtesy to all parties:

“We’re very open. We like to work with our customers. We acknowledge they’re customers and want to be fair,” said Henderson.

City Council members took a harder stance after receiving a counter-proposal from Norton Shores and Fruitport on Monday.

This counterproposal, dated June 8, 2012, was received by Muskegon Heights today.  Muskegon Heights did not request a response date on their proposal, though Norton Shores and Fruitport requested a response by June 22, a decision window of two weeks from the date on the letter.

While a counter-proposal would, by its nature, have differences from the Heights proposal, the council grew to see Fruitport Township’s name on the June 8 counter-proposal as a sticking point.

Councilwoman Bonnie McGlothin initially suggested the topic.  She argued that starting with Fruitport’s termination notice in April of 2011, the township’s authority to negotiate a new deal alongside Norton Shores ceased to exist.  McGlothin suggested that Norton Shores was still relevant because they opted to continue negotiations without a pre-emptive decision to terminate its contract.

Councilman Keith Guy stated that Fruitport could not declare themselves out of the game and still try to negotiate.

Out of these Monday’s discussions, the council voted unanimously to direct the city manager to continue negotiations with the city of Norton Shores, but not Fruitport.

Two proposals deemed final by each side have large gaps in how they would operate.

• By Muskegon Heights’ plan, a rate multiplier of 25% on the amount of water consumed would be applied, which is how many multipliers work.  The Norton Shores proposal sets a 10% multiplier on the plant’s total operating expenses.
• The Norton Shores plan would call for a unanimous vote to appoint three consultants to study the reliability of the Muskegon Heights water plant.
• The Norton Shores plan would also place a cap on how large the water plant’s fund balance could become. If it grows too large, the city could be sued.
• The Norton Shores/Fruitport plan also sought to allow the pair of cities to pick whom they would negotiate with in the City of Muskegon Heights.

Regarding the provisions capping the growth of the water fund balance and administrative fees and oversight, councilwoman Patrice Johnson deemed the Norton Shores proposal not in the best interests of Muskegon Heights.

“You pretty much want to control something that doesn’t belong to you, and I consider that to be a slap in the face.”

No final action was taken on the Norton Shores/Fruitport counter-proposal by the council at Monday’s meeting.  It is likely that further decisions may be moved at next Monday’s committee of the whole meeting at City Hall.