The Hulah Rural Water District is beleaguered, to put it mildly.
The tiny water district has just 160 customers, and it spends, on average, $14,894 a month and brings in just $11,651.
And that isn’t taking into account the $28,000 it has spent cleaning up water-line breaks it says were caused by the installation of fiber optic cable by a contractor for Osage Innovative Services, the broadband subsidiary of Osage LLC.
“We’re almost belly up,” said David Horton, a member of the district’s board of directors. “We’re just about that close.”
Thanks to the firehose of federal spending on rural infrastructure, especially broadband, Hulah’s predicament is far from unique. Susan Bohl, the director of Oklahoma’s One-Call System for locating underground utilities and reporting damage to them, said the state has seen a deluge of out-of-state excavating contractors and many water, gas and communications line breaks due to their work.
Sometimes, the damages occur because a contractor failed to call 811 to locate utilities, and sometimes, especially in rural areas, maps of existing lines are inaccurate. The evidence is primarily anecdotal, Bohl said: The laws requiring 811 utility locates and damage reports have few teeth in terms of enforcement, and largely rely on the honor system.
“The state has very little enforcement authority,” Bohl said. “If they’re not registered or permitted, cities and counties can fine them.”
One-Call’s database shows that the LLC contractor, Gulf Shore Tel-Com LLC, opened tickets for 77 utility locates between Dec. 1, 2022 and the end of May 2023 in the Bowring area, and 453 overall. The same company is contracted to lay fiber optic cable for WahZhaZhe Connect, the $54 million project the Osage Nation is handling in-house rather than awarding it to its independent business entity, OIS, which falls under Osage LLC.
The Nation and its LLC have been at odds, and recently the friction led to the Nation kicking the LLC off its network because the LLC wouldn’t let the Nation use LLC fiber in Bowring and Fairfax.
Lawsuit discussed
The Hulah water board voted at its June meeting to send a demand letter to Osage LLC and members said previous attempts to get Gulf Shore Tel-Com, a Texas company not registered to do business in Oklahoma, according to the Oklahoma Secretary of State, were unsuccessful. The board also discussed suing Osage LLC, but decided to wait.
“They’re not even authorized to do business in Oklahoma,” said Laura Teague, chair of the water district board and a cattle rancher.
Berbon Hamilton, Osage LLC’s project manager, said OIS has been notified about the leaks. In an email, he said Gulf Shore Tel-Com has documented that it was not at fault for the leaks. He added that the “management team” has requested documentation from the water district and has received none. He also said that Gulf Shore is an “approved vendor” for the U.S. Department of Agriculture’s Rural Utilities Service. USDA’s newly installed spokesman in Stillwater said he would be unable to verify that for several days and was unaware if the agency kept a database of approved vendors.
Emails to Gulf Shore and the ACRS, the engineering contractor overseeing the project, went unanswered.
Adamant most fault lies with Gulf Shore are the Hulah board and Jim Edens, its operator, who describes Gulf Shore’s excavations as sloppy at best. Gulf Shore has cut water lines 25-30 times, the largest being a 2,000-foot stretch of pipe that was ripped up at night, Edens said.
“They didn’t ask, they just started digging and hitting them,” Edens said.
Pat Barnett, a founding member of the water district board since 1965, said that OIS and its contractors came in to Bowring by surprise.
“This bunch. We had no warning,” she said. “They came up from the south, around Sunset Lake to Bowring, and built this great big tower.
“We had no idea what it was. Nobody talked to anybody until they hit our water line.”
The truth is murky
Water district and Gulf Shore employees have accused each other of lying on the Bowring community Facebook page, a site that alerts residents to cattle roaming, lost dogs, yard sales – and since early December, constant water breaks – including one that became apparent on Christmas.
On the one hand, Edens accuses Gulf Shore of digging willy-nilly, ignoring marked lines, failing to follow his instructions to wait, and working at night when they can’t see properly. He noted that when Totah Communications laid its fiber optic in the area, that company never hit a single line. Edens said that Gulf Shore also hit a large AT&T line near Pawhuska that caused a massive cell phone outage last year. (Water district chair Teague, who was Pawhuska’s city manager at the time, confirmed Gulf Shore hit that fiber line and a Pawhuska water line, but the company was cooperative and helped fix it.)
On the other hand, Gulf Shore excavator Zeb Ty Johnson countered on Facebook that Edens marked the lines only on one side of the road. “Again, sincerely hate it for the people of these towns but you, sir, need to mark your lines correctly …”
Contrary to some comments made at the water district meeting, the fiber optic project was granted a utility permit from Osage County: It is filed not under the name of Gulf Shore but under Osage Innovative Solutions and ACRS, OIS’s engineering contractor – and it took some digging to find it in the Osage County Clerk’s Office.
Water district’s future is shaky
Regardless of who’s at fault for the water-line breaks, the $28,000 in damages is an expense the water district cannot afford. At its meeting on June 8, Randy Clark of the Oklahoma Rural Water Association delivered a grim report about how the district might balance its budget and stanch the financial bleeding: First, raise the basic water rate from $35 a month to $60, increase the new meter installation price from $750 to $1,750, and increase the price for water after the first 1,000 gallons. The monthly cost for a household that uses 5,000 gallons of water would jump from $92 to $140, a 52 percent increase.
Clark’s analysis did not factor in the cost of repairs that Hulah RWD has borne because of the OIS fiber project: He was aiming to have the water district bank $1,000 a month in savings so it will be able to stockpile some parts and be prepared for the unexpected.
Even with a rate increase, the future of the Hulah Rural Water District is uncertain. The district has pondered becoming a part of the Copan Rural Water District from which it now buys water, but Copan has shown no interest. If Hulah does go belly up, the county or Copan would have to take over operations, the board said.
Board member John Chinn, like others, supported the rate increase unenthusiastically.
“It’s certainly not my pleasure to do this,” he said. “We’ve robbed Peter to pay Paul, and now Peter wants to be paid, too.”
