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MailTribune.com
  • PremierWest won't wait for Shady Cove to buy waterworks

    Bank will sell foreclosed private water system as soon as possible
  • SHADY COVE — After waiting months for the city to buy Shady Cove Waterworks, PremierWest representatives told residents at a town hall meeting Wednesday the bank can't wait any longer and will sell the private water system as soon as possible.
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  • SHADY COVE — After waiting months for the city to buy Shady Cove Waterworks, PremierWest representatives told residents at a town hall meeting Wednesday the bank can't wait any longer and will sell the private water system as soon as possible.
    "We're not in the water business," PremierWest President James Ford told a crowd of about 110 people. "We never wanted to be in the water business. Our shareholders have lost not thousands, not hundreds of thousands, but seven figures in this transaction."
    PremierWest financed construction of the Waterworks system, but when its developer went into foreclosure more than two years ago, the bank took over the water company's daily operation.
    "We're in the business of lending money, taking deposits and serving our community," said Ford, "not running a water system. "… The most important thing you should take away from tonight's meeting is we have resolved that we will not be running this water system forever. We will sell it."
    Shady Cove relies on nearly 1,000 wells and is the largest city in Oregon without a municipal water system.
    In January, the City Council received an update to their water master plan that included two options — build a complete system from scratch or build a system that incorporates the Waterworks facilities, most of which are located outside the city limits. Since then the council and a citizens advisory committee have been investigating both options, but have not yet made a final decision.
    "The City Council is doing its due diligence," said Danise Brakeman, Shady Cove city administrator, "trying to answer some of the questions that they felt were unanswered by the water study. "… We have a citizens task force and they have put in a lot of hours looking into those questions, but they can only go so far because they don't have the technical expertise that an engineer will have."
    Brakeman said the city has hired an engineer who is looking into the unresolved issues and she expects answers within a few weeks.
    "The council is committed to getting those questions answered," she said. "They want the community to have water."
    In February, Mark Illsley, of CPM Real Estate Services, representing PremierWest, said the bank would sell Waterworks to the city for $2.6 million, but would also make the same offer "to any and all buyers."
    Beginning in April, the property was advertised in The Wall Street Journal and other nationwide listings.
    Two months ago, Illsley said the bank dropped the price to $2 million and was willing to finance the loan. At the time, city officials said they believed the offer was for $1.6 million.
    "If the decision is that the city of Shady Cove is not interested in this water system," Ford said, "that's fine with us. We will engage folks to sell it to someone who will be interested in it."
    Writer Bill Miller lives in Shady Cove. Reach him at newsmiller@live.com.
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