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Tellico Village board moves $5.62 million into water and sewer reserve ahead of utility regulation
Summary
The TV POA board voted to move $5,622,335 into segregated water and sewer reserves to align past accounting with imminent regulation by the Tennessee utility regulator; directors debated timing, committee review and impact on other projects before approving the transfer.
The Tellico Village Property Owners Association board voted to transfer $5,622,335 from general reserves and prior utility‑installation receipts into the water and sewer reserve as part of preparations to come under state utility regulation. The motion, introduced by a board member, passed after extended debate about methodology and oversight.
Board members said the move is intended to put the utility accounts in the form a regulator will expect. "We want to look boringly correct the first time the regulator looks at you," a board member said, urging the board to consolidate net surpluses into the water and sewer accounts so the utility district appears conservatively managed. Opponents asked for more numeric detail and recommended the finance advisory committee review the supporting spreadsheet before a transfer.
Finance director Judy Bedford and staff circulated an analysis showing that moving previously recorded surpluses would reclassify about $192,793 of water‑only items and $5,429,542 of utility‑tank‑installation (UTI) net surpluses; together they produced the $5,622,335 figure the motion appended. Critics said they were uncomfortable approving a multimillion‑dollar transfer without a finance‑committee recommendation and sought clarity about any impacts on planned capital projects and reserve-study metrics.
Supporters said the transfer corrects how funds were recorded in prior years and is necessary to comply with the forthcoming utility district rules. "Once we come under regulation, you cannot move anything into the water sewer reserve account that isn't already there," a board member said, arguing the board was acting to "right a past wrong" and to avoid regulatory complications. The board appended the spreadsheet to the motion and approved the transfer by voice vote.
The board discussed (and did not adopt at this meeting) changes to how the new utility district accounts will be labeled and how soon the POA will implement enterprise accounting and separate water and sewer ledgers. Management said staff would finalize operational details and that additional review documents had been circulated to directors. The motion carried; directors and advisory committee chairs said they will continue to pursue review and transparency in accounting going forward.
The transfer is part of broader activity at the meeting: directors also approved a separate motion to refund an $80 water/sewer infrastructure asset fee (see separate story) and directed staff to implement refund procedures.
