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Contract holders attend contentious sewer board meeting in Pine River

Allegations of improprieties aired by board member.

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Echo Journal file photo.

Contract holders from Backus, Pequot Lakes and Barclay Township were among those in attendance at an Oct. 28 regular Pine River Area Sanitary District meeting. Those in attendance were, in part, brought together over questions surrounding a proposal to contract with PeopleService Inc. of Omaha, Nebraska, for wastewater and maintenance services.

The contract holders wanted to learn about the proposed contract and any possible impacts on their services.

Backus, Pequot Lakes and Lake Shore all contract with PRASD for various public works services. Barclay Township, Wilson Township and the cities of Chickamaw Beach and Pine River are all members of the joint powers agreement that created the sewer district and ultimately the treatment plant.

As a result, they all have a stake in decisions.

Also in attendance was the full PRASD board, the office manager and all four PRASD maintenance employees. A disagreement was foreshadowed during approval of the Sept. 22 PRASD meeting minutes when board member Mike Hansen asked to correct the minutes regarding hiring an attorney for contract management.

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Hansen said the decision in September was unanimous to hire an independent, non-biased attorney who did not represent Pine River or the district, possibly recommended by the League of Minnesota Cities, to advise the board on contract management. Included in the October board packet was a letter from Mark Johnson, PRASD attorney offering his services for the investigation.

PRASD board member Alan Johnson said he contacted Mark Johnson after the League of Minnesota Cities assured him there would be no conflict of interest in hiring the district's own attorney for the work.

Hansen opposed this decision, alleging it went in opposition to the unanimous board decision made in September. He said again that the board agreed to hire a non-biased attorney, to which PRASD board member Cindy Spartz said Mark Johnson worked in the best interest of the sewer district and would be non-biased.

Board chair Gary Siltman agreed the board was bound by the decision made at the Sept. 22 meeting and directed Hansen to contact the League of Minnesota Cities to get attorney recommendations. He is to pass those recommendations on to PRASD Business Manager Wanda Schrupp, who will send them to the other board members to avoid breaking the Open Meeting Law.

The board nearly violated that law by directing Hansen to directly share his findings with the rest of the board, until some in the audience clarified that this would be an Open Meeting Law violation. Board members during the meeting showed indications they might not be aware of how strict the Open Meeting Law is, and when it applies.

Upon receiving the information, board members will then review their options to choose an attorney for the investigation at the Nov. 17 regular meeting.

Proposed contract

Most contentious was discussion of the proposed contract with PeopleService, which resulted in raised voices and loud arguments including board members, the office manager, maintenance staff and one resident in attendance. This subject was what led to the attendance of representatives from the contract holders, brought together initially to discuss the Backus contract.

Backus City Clerk Ann Swanson had apparently noticed the PRASD workers in Backus were in a down mood and asked why, leading to them explaining the upcoming discussion of the PeopleService contract.

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The Backus City Council held an emergency meeting Sept. 22, mere hours before that day's PRASD meeting. Council member Karl Flier and Mayor Kurt Sawyer attended that night's PRASD meeting. At the time, the council had sent a letter to PRASD saying they were concerned that the contract could result in loss of experienced workers, an increase in their contract amount after the city has already passed a general revenue tax levy, and overall loss of quality of service.

Later, Sawyer and Flier, representing Backus, arranged a meeting with representatives from Pequot Lakes and Lake Shore. Sawyer, Flier, Swanson and Pequot Lakes City Administrator Rich Spiczka attended the Oct. 28 PRASD meeting. A Lake Shore representative was not in attendance. They did meet with Sawyer and Flier but chose to not attend and did not offer any comments when contacted.

During the Oct. 28 meeting, PRASD board member Hansen accused board members Siltman, Spartz and Johnson of violating the Open Meeting Law by discussing their plans for the PeopleService contract outside of the board's public meetings. The discussion between Hansen and Siltman that led to this discovery may have also constituted a violation.

The Pine River City Council as well as Hansen, public works director for the city, spoke to Siltman at the Tuesday, Oct. 26, Pine River planning meeting in detail about whether Siltman had been in contact with Johnson and Spartz. Thus, Hansen was discussing the contract with Siltman, who, in turn, discussed the contract with at least one other board member.

Government groups traditionally use committees to ensure they don't violate the Open Meeting Law as they can limit the number of members who attend and speak on a selected topic.

Spiczka informed the board that the Open Meeting Law applies to phone calls and emails as well as one board member talking to several other board members at different times.

Frustrated with the meeting and general attitude of the PRASD board, and with recommendation from the Pine River City Council, Siltman announced his resignation from the board.

The board included more details about the contract for PeopleService in the meeting documents and encouraged the contract holders to read those documents.

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Backus service contract

They also provided the new service contract with the city of Backus as well as a letter from PeopleService intending to provide more details on the proposed agreement with PRASD. The letter includes details on positions and benefits packages for the current PRASD maintenance crew members.

A board member insisted that the actual contract also include a requirement that PeopleService offer equivalent jobs to the current employees.

One maintenance member said the contract says they would be re-interviewed for their jobs, and that does not guarantee that they would be rehired.

The document reads, "We will give them the opportunity to apply for posted positions, to interview with management, and if there is a fit to then pass our pre-employment requirements."

The document lists three positions: lead III operator, operator I and maintenance tech. The document indicates there would be one lead operator and one maintenance tech, but does not spell out whether there would be more than one operator I position..

In addition, the workers said the package is not favorable to them. One said he stood to lose $40,000; another said he has paid into his company retirement fund for five years, but the new contract would cost him the employee contribution that was used to recruit him.

They said they would not remain with the sewer district if they contract with PeopleService.

Hansen said the district's contract holders might reconsider their contracts if the current workers leave, and that it could affect service rates for all customers. Johnson later disagreed in regard to the possible sewer rate increase, stating that the contract with Backus nearly breaks even. Records indicate this is correct.

Swanson asked whether the PRASD board had considered contacting its contract holders before seeking a contract with PeopleService. A board member said an employee had suggested it. Ultimately, the board did not choose to do so.

Swanson said the current contract, which is due to be renewed, requires PRASD to consult with contract holders before hiring a subcontractor. The new, proposed contract does not include that requirement.

Others’ thoughts

Contacted after the PRASD meeting, Spiczka said: "I was there in attendance on behalf of the city just for information gathering to kind of understand how PRASD serves the city of Pequot Lakes and how we can best serve our residents. My attendance was directly for that purpose."

The Backus City Council discussed its representatives' impression of the PRASD meeting during its Monday, Nov. 1, regular meeting and chose to have the city attorney review the new PRASD contract, which specifies a 21% increase. Flier also said he'd like to wait to see how changes develop with the board now short one member.

The city of Pine River may also submit a recommendation for its second board representative to replace Siltman, possibly further changing the dynamic.

Backus council member Rae Borst asked Nov. 1 what the purpose of seeking an outside contract was if it wouldn't include a cost savings. At the PRASD meeting, Johnson said most of the details behind the motivation to seek a subcontractor were protected under data privacy but may become available after an investigation by the attorney the board hires.

Johnson suggested he didn't have confidence in the PRASD board's ability to continue to manage its employees. He said the sewer district doesn't function with four bosses, prompting one maintenance crew member to shout that the board is not their employer, though the board is included in the organization's hierarchy.

The Backus council also briefly discussed looking into whether the city could be added to the joint powers alliance that created PRASD and therefore be allowed a representative on the board.



Editor's Note: A correction was made to this article on November 3, 2021. The article incorrectly stated the contract between PRASD and Backus did not require the sewer board to consult with contract holders over the possibility of subcontracting. That is only true of the proposed contract which the city has not yet signed. The current contract requires the PRASD board to consult with contract holders.

Travis Grimler is a staff writer for the Pineandlakes Echo Journal weekly newspaper in Pequot Lakes/Pine River. He may be reached at 218-855-5853 or travis.grimler@pineandlakes.com.

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Pine River Area Sanitary District

Travis Grimler began work at the Echo Journal Jan. 2 of 2013 while the publication was still split in two as the Pine River Journal and Lake Country Echo. He is a full time reporter/photographer/videographer for the paper and operates primarily out of the northern stretch of the coverage area (Hackensack to Jenkins).
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