It appears Oxford Village could be going into the bulk-water business, but first it needs to establish a policy and set a price.

Officials are going to meet on Tuesday, June 27 to discuss and review the issue.

Tim Dabish, president of Intrastate Distributors, Inc., a Detroit-based beverage company established in 1980, has expressed interest in potentially purchasing water from the village system, according to a written report submitted to council by Rose Bejma.

“His best guess at this time would be to get 100,000 gallons, possibly twice a week,” she wrote. “This would be an ongoing bulk water sale.”

Bejma chairs a committee formed by council in August 2016 to explore the possibility of supplying village water to companies interested in bottling and selling it. It’s one of three committees tasked with finding new revenue streams to shore up the municipality’s water fund and stave off having to increase water rates.

The last time the village raised water rates was October 2014.

According to the company’s website, Intrastate Distributors deals in a variety of beverages including soda, tea, lemonade, water, juice, energy drinks, milk and coffee. The company owns and bottles Towne Club brand soda, well-known in the Detroit area since the mid-1960s.

Bejma approached council last week about establishing a bulk water sales policy, “so that when (Dabish is) ready, we’re ready.”

When asked to comment about Intrastate Distributors’ potential plans for Oxford water, Dabish wrote, in a May 17 email to this reporter, “We have not committed to the water source. The story would be premature.”

It’s not clear whether Intrastate Distributors is interested in buying village water that’s been treated by the municipality’s plant or untreated water straight from the wells.

“(Dabish) hadn’t made his mind up,” wrote Bejma in a text message to this reporter. “He took samples of both.”

Currently, the village charges its residential, commercial and industrial water customers $3.96 for every 1,000 gallons of water they use.

This is in addition to the flat rate based on meter size that all water customers pay each month, regardless of whether or not they actually consume any water. The monthly flat rate ranges from $16.45 for a three-quarter-inch meter to $452.44 for a 6-inch meter.

Village attorney Bob Davis told council the price charged for bulk water “has to be magnitudes different than what you charge the citizens whose tax dollars built and maintained the system over the years.”

“It has to be a rate that is well-studied,” said Davis, who noted the village could be looking at a significant increase in revenue if it received, for example, $1,000 per visit from the bulk purchaser.

In her report, Bejma wrote, “The committee discussed (charging bulk buyers) possibly 2 or 2.5 times the rate (currently paid by) village residents.” She provided council with a bulk water policy established in December 2016 by the Village of Farwell, which is located in northern Michigan’s Clare County.

“I will continue to look around and see if there’s any other communities that do have a bulk water policy,” Bejma told council.

Farwell charges $5 per 1,000 gallons, plus service fees, which are $15 per load during regular working hours (7 a.m. to 3 p.m.) and $30 per load after hours.

According to Farwell Village President Gina Hamilton, this policy is meant to recoup costs, not generate additional revenue for the municipality. “We had already been selling water in bulk,” she explained. “We adopted the policy mainly because our DPW crew (was) coming in (during) off-hours to turn the water on and fill the containers (for bulk-water customers). Basically, we did it so we could get our money back.”

Hamilton said Farwell has been selling bulk water for at least eight years. That’s how long she’s served on council.

Farwell doesn’t provide bulk water to anyone who bottles and resells it, according to Hamilton. It’s mainly purchased by businesses that use water in their work or as part of the services they provide, she said.

“We have probably just three or four regular (bulk water) customers,” Hamilton said.

Water customers hooked up to Farwell’s system currently pay a monthly base rate that ranges from $24.04 for a three-quarter-inch residential meter to $490.55 for a 4-inch commercial/industrial meter. These base charges include anywhere from 3,500 gallons to 56,000 gallons per month, depending on meter size.

“Above that, they pay $1.47 per 1,000 (gallons),” Hamilton said.

Oxford officials believe the village does have enough extra water to sell without negatively impacting its supply or customer base.

“All the experts would agree that our water supply in terms of quantity is not . . . anywhere near any form of exhaustion,” Davis said.

According to Bob Ashmead, a licensed operator with Highland Treatment, the Highland-based company the village contracts with to operate its water treatment plant on S. Glaspie St., the facility is supposed to be capable to producing up to 2.2 million gallons of treated water per day. But “that’s not really a practical number,” he noted.

To achieve 2.2 million gallons a day, Ashmead explained the high service pump, which sends water into the village’s 500,000-gallon elevated storage tank, would have to be running at “full speed 24 hours a day.”

If the village wasn’t removing iron from the groundwater and softening it, the plant could achieve this number, Ashmead said.

But the village is doing these things and they impact the plant’s output because the iron filters and softeners need to regenerate.

“The softeners regenerate every 212,000 gallons and the iron filters are set (to regenerate) every four days,” Ashmead said.

It takes the iron filters an hour-and-a-half to regenerate and during this time, the high service pump is completely shut down, according to Ashmead. It also takes the softeners an hour-and-a-half to regenerate and while this does not turn off the high service pump, it does reduce the plant’s flow by about a third, he said.

Given all this, Ashmead said 1.2 million gallons is probably a more realistic number for how much water the treatment plant could potentially produce on a daily basis.

But whether it’s 2.2 million gallons or 1.2 million gallons, the demand from village water customers isn’t approaching either number.

Between November 2016 and April 2017, Ashmead said the average flow per day from the treatment plant was 255,348 gallons. The maximum flow was 359,552 gallons and the minimum was 154,240 gallons.

Between May and October 2016, Ashmead said the average flow per day was 442,839 gallons. The maximum was 874,912 gallons and the minimum was 186,464 gallons.

The village water system currently has three operating wells from which it draws. Two of them can pump 1,000 gallons per minute (gpm), while one can pump 1,500 gpm, according to Dave Stinson, of the Lansing-based Northern Pump & Well.

“The total capacity you could pump, full out, is 3,500 gallons a minute if all three of them were operating,” Stinson said. “They can run all three anytime they want to.”

He noted, “any (municipality) has to have enough well capacity, so that if you take your largest well out of service on any peak day in the year, the other wells can produce enough water.”

In the village’s case, Stinson said, “If I have to take (the 1,500 gpm well) out of service to do some repairs on it . . . the two 1,000-gallon wells have to (provide) sufficient enough water to supply the needs of the village – and they (can).”