Central Arkansas Water is under fire from state lawmakers for so-called “lobbying” activities during the legislative session earlier this year.
Officials from the water utility took questions from members of the legislature’s Joint Performance Review committee Tuesday. At issue is the utility’s payment of $118,525 to organizations and nonprofits, including the Women’s Foundation of Arkansas and the Arkansas Black Hall of Fame.
Central Arkansas Water CEO Tad Bohannon says the payments were to help outreach efforts in communities with a historic distrust of water utilities.
“You can look at what’s happened in our country, with Flint, with Detroit, with Jackson, Miss., and… not everybody trusts that they’re going to drink it,” Bohannon said. “We reach out to organizations that reach us out into those communities to build that trust.”
Bohannon added partnerships with nonprofits help CAW boost their ongoing community outreach and workforce development efforts. Sen. Jonathan Dismang, R-Beebe, complained of a lack of oversight, and that the utility plans to raise rates while giving money to outside entities.
“I do appreciate the awareness that you’ve brought to several code sections that clearly need to be revised, because I do think it’s inappropriate that you have been allowed to spend $118,000 of ratepayers’ money to be able to contribute to the entities of your choosing based on your own personal beliefs of what creates value,” Dismang said.
Central Arkansas Water’s board in January approved a schedule of rate increases over the next decade, with customers expecting to pay nearly double their current rates by 2032.
Dismang and other lawmakers also called on the utility to include representatives from more central Arkansas communities on their board, noting that large communities like Maumelle and Sherwood are not represented.
Lawmakers also raised questions over an email sent by the utility’s Justice, Equity, Diversity and Inclusion, or JEDI, team speaking against Senate Bill 71, which would have done away with affirmative action programs in Arkansas.
“If you or someone you love is a woman, disabled, Black, veteran, Hispanic or Latinx this bill will impact you,” the email dated March 21, 2023 reads.
The bill’s sponsor, Sen. Dan Sullivan, R-Jonesboro, said more government entities should be investigated for advocating for a political cause.
“As I’ve looked into this and see the amount of money that we’re expending on these services rather than reducing the cost of your product, I think there’s going to be a larger conversation with utilities across the state and how we’re donating money to nonprofits,” Sullivan said.
Committee members voted to request an investigation into Central Arkansas Water by the Arkansas Ethics Commission into the utility’s “lobbying and donation activity” during the 2023 legislative session. The measure passed on a voice vote, with only one audible “no” vote.