THE MISSISSIPPI LEGISLATURE

The Joint Committee on

Performance Evaluation and Expenditure Review


Report # 546

A Review of the Harrison County Utility Authority

Executive Summary

Introduction

Problem Statement

Following the devastation of Hurricane Katrina in 2005, Governor Barbour created a commission to study and offer recommendations for the Mississippi Gulf Coast’s recovery. One of those recommendations was to create an entity to manage sewer, water, storm water, and other utility services across the six Gulf Coast counties (Hancock, Harrison, Jackson, Pearl River, Stone, and George). Congress appropriated approximately $5 billion to Mississippi for aiding the recovery effort and the Governor directed that a portion of these funds be used for utility infrastructure in the Gulf Coast counties.

The Gulf Coast Region Utility Act, passed during the 2006 Regular Session of the Legislature, created a regional utility authority and the six countywide utility authorities, including the Harrison County Utility Authority (HCUA). The act gave to each utility authority the legal authority to oversee water and wastewater services in the respective counties.

Soon thereafter, the Mississippi Gulf Region Water and Wastewater Plan (MGRWWP) was authorized by a contract between the Mississippi Department of Environmental Quality and the Mississippi Engineering Group. The purpose of the plan was to identify immediate water and wastewater infrastructure needs, project water and wastewater infrastructure needs over the next twenty-five years, and promote economic development in the six Gulf Coast counties.

Recently legislators raised concerns regarding the Harrison County Utility Authority’s operations and expenditures relative to Community Development Block Grant funds received from the U. S. Department of Housing and Urban Development through the Mississippi Development Authority--specifically, the percentage of those funds spent on consulting services such as engineering and legal fees.

Scope and Purpose

In conducting this review, the PEER Committee sought to address the following:

The Harrison County Utility Authority and the Mississippi Gulf Region Water and Wastewater Plan

The Harrison County Utility Authority funds its operations and debt service by assessing each member city and the county an amount in relation to the usage of water and sewer by citizens within each member’s boundaries. The HCUA contracts with an engineering firm, legal counsel, and an administrator for the management and administration of Community Development Block Grant projects.

The Mississippi Gulf Region Water and Wastewater Plan proposed utility infrastructure projects to be paid for with Community Development Block Grant funds. While other studies projected slow to moderate growth (between 2% to 27%) in Harrison County from 2000 to 2020, the MGRWWP projected explosive growth (64%) for the same period. Since the MGRWWP population projections were a factor in justifying the construction of water tanks and wastewater facilities, Harrison County now has utility infrastructure sufficient to serve a population level that most likely will not materialize in the near future.

The Harrison County Utility Authority’s Expenditures for Community Development Block Grant Projects Since 2006

The HCUA is overseeing twenty-five major Community Development Block Grant projects valued at approximately $235 million. The projects consist of nine water systems with seventy-five miles of water mains, thirteen elevated water tanks and fourteen water wells, sixteen sewer projects with sixty-five miles of transmission lines, twenty-nine wastewater pump stations, and five wastewater treatment facilities.

From May 31, 2007, through October 31, 2010, the HCUA has expended approximately $122 million on Community Development Block Grant projects. Of this amount, $81 million, or sixty-six percent, was expended on construction, with the remaining $41 million expended on land, engineering services, and administrative services associated with the Community Development Block Grant projects.

While reviewing HCUA’s expenditure records, PEER noted the following issues:

Recommendations

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