BY ROGER SMITH
MOUNTAIN CITIZEN
INEZ — The Martin County Water District lost 48.92% of the water it produced in March, an improvement from roughly 70% a year ago but still leaving nearly half the system’s water unaccounted for due to leaks and line breaks.
Alliance Water Resources presented the figures during the Aug. 28 Martin County Water Board meeting, which opened with leadership changes.
Board member Colby Kirk led the meeting in the absence of chairman Tim Thoma, who resigned, and Nina McCoy, who the Martin County Fiscal Court replaced with Norma McCormick.
“I know everyone in the audience is aware there’s been some changes on the board,” Kirk said. “So I would like to formally reflect some gratitude in the minutes for the service of Nina McCoy, who was my only appointment on the water board when I was county judge/executive. I appreciate her service to the community. She’s been a lifelong advocate for water, and I know she’s going to stay involved from the Concerned Citizens perspective. We look forward to continuing that work with you all.”
Kirk also thanked Thoma for his service and welcomed McCormick to the board.
“We’re looking forward to working with you,” he said. “We still have a vacancy that will be appointed. So we won’t have a full board until next month.”
Water loss still driven by leaks
Alliance Water Resources local manager Colby May reported the district lost 16.8 million gallons of water in March out of 34.4 million gallons produced.
Of the total water entering the system, 16.47 million gallons were sold to customers and 1.09 million gallons were used for system operations such as flushing, plant use and fire protection. The remainder was classified as lost water.
Line leaks accounted for 14.33 million gallons, and line breaks accounted for another 2.49 million gallons. No losses were reported from theft, tank overflows or excavation damage.
Residential customers accounted for 9.95 million gallons of billed water. Commercial usage totaled 2.84 million gallons, and wholesale customers accounted for 3.68 million gallons. No industrial usage was reported.
May also reviewed capital project schedules and budgets. Details of the projects are in the district’s board meeting packet beginning on page 58:
mcub.myruralwater.com/documents/1508/BP_MCW_DIV07_28APR26_Final.pdf.
Cash position strained despite steady collections
Erica Bogenpohl, senior operations manager for Alliance Water Resources, presented a treasury report showing the system ended March with limited cash and a negative available balance after accounting for bills.
The district closed the month with $10,550.13 in its operations account.
“That is really, really low,” Bogenpohl said. “However, we were able to make it work, got all the bills paid. That’s about as low as I’d like to see it get.”
At the same time, the district had $329,566.02 in bills submitted for April payment. After accounting for $235,861.61 in April receipts, the available balance stood at negative $83,154.28.
The district generated $241,196.74 in billing charges for March, including $163,482.49 in residential revenue and $30,819.38 in commercial revenue. Other revenue came from surcharges, taxes and fees.
The system billed 12,792,270 gallons to 3,270 customers and collected $243,655.98 in accounts receivable, slightly exceeding the monthly billing amount.
Total accounts receivable remained high at $353,555.06, down slightly from $356,014.30 at the start of the month.
Cash activity reflects the tight position. The district began March with $38,285.77 and recorded $422,101.26 in deposits from collections, transfers and other revenue. Disbursements totaled $311,851.91 in checks, along with additional outflows for sanitation transfers, auto-drafted utilities, lease payments and taxes, leaving just over $10,000 at month’s end.
Revenues lag, expenses controlled
Bogenpohl reported a positive operating margin through the first nine months of the fiscal year, though revenue remains below budget.
From July 1 through March, the district generated $840,009 in operating revenue and $726,640 in operating expenses, producing an operating surplus of $113,369. That falls short of the budgeted $165,438 margin.
For March alone, operating revenue totaled $257,750 and expenses $219,593, resulting in a monthly surplus of $38,157.
Year-to-date revenue trails projections by $54,774, with residential water sales accounting for the largest gap at approximately $31,700 below budget. Commercial revenue was about $3,350 under projections.
Other revenue categories, including public authority sales, surcharges and fees, tracked closer to budget.
Operating expenses totaled $726,640, about $2,700 below budget. The management and operations contract remains the largest expense at $544,725 year to date, representing roughly 75% of operating costs.
The district reported net income of $124,535, largely driven by $183,379 in capital contributions, along with smaller gains from interest and other adjustments, which offset depreciation and interest expenses.
“Not a good month as far as revenue goes,” Bogenpohl said. “But when we look at April, currently … we are over budget. So we’re hoping this next month we are going to recover.”
Payables remain elevated
Outstanding balances to Alliance Water Resources and the Martin County Sanitation District have fluctuated over the past year but remain elevated.
The district owed between roughly $330,000 and $450,000 to Alliance over the past 13 months, with peaks near $450,000 in spring 2025 and early 2026. The balance dipped to about $265,000 in October before rising again.
By March 2026, the district carried an estimated $375,000 obligation to Alliance and roughly $65,000 owed to sanitation.
Sanitation balances have increased steadily from about $20,000–$30,000 earlier in the period.
The data reflects timing gaps between when expenses are incurred and when payments are made. The Alliance contract remains the district’s largest recurring cost.
Bills reflect ongoing cost pressures
The district listed $374,342.54 in bills for payment at the end of April, driven largely by recurring operating costs, debt obligations and infrastructure work.
Recurring expenses totaled $260,932.32, including $181,575 in operations and maintenance invoices to Alliance and $7,072.63 for insurance.
Utility costs included $27,730.49 to American Electric Power and $2,329.69 to Big Sandy RECC.
Other recurring charges included $6,639.99 in school taxes.
Nonrecurring charges totaled $90,910.22, led by $48,000 to Bell Engineering for system improvements. Additional project-related expenses include multiple payments tied to the district’s meter project, with invoices to Jabo totaling several thousand dollars, as well as $3,774.99 to Consolidated Pipe. The district also listed $5,220.80 and $3,504.60 to Buchanan Pump Service for FEMA-related pump work.
Professional and legal expenses included $3,019.50 to Stites & Harbison and $8,375 for audit services.
The district also listed $22,500 in debt service funding for bond and loan obligations, including the KIA sinking fund and a generator project.
Leadership transitions continue
Bogenpohl said local manager Colby May is serving as interim regional operations manager following the departure of Todd Adams five months ago. She said Alliance is interviewing candidates to fill the local manager position.
“By the next board meeting we’ll have a permanent arrangement ready to announce,” Bogenpohl said.
Board member John Paul Hensley will serve as interim board chairman.