THE MISSISSIPPI LEGISLATURE

PEER authorized this review in response to citizen complaints about the Pat Harrison Waterway District’s management of Archusa Creek Water Park in Clarke County, one of nine water parks developed and managed by the district. Complainants allege that Archusa Creek Water Park is not getting its “fair share” of PHWD resources.

To answer the complainants’ concerns, PEER sought to determine the sources of funding to the Pat Harrison Waterway District and the method that the district uses to allocate funds to its programs.

PEER also addressed specific allegations by complainants.

The Pat Harrison Waterway District (PHWD) is a regional body created to conserve and develop water and related natural resources in the fifteen-county southeast Mississippi Pascagoula River Basin. PHWD operates three programs: recreation, flood control, and water management.

The Pat Harrison Waterway District Board of Directors is, by statute (MISS. CODE ANN. Section 51-15-1), composed of fifteen members, one appointed by the board of supervisors from each member county, and three gubernatorial appointments.

Most of PHWD’s revenues come from ad valorem taxes collected from the member counties (approximately $2 million in FY 2001) and park recreation fees (approximately $1.9 million in FY 2001). Other revenue sources include interest earnings on investments and sales of timber and gravel. Member counties also contribute to the district’s debt retirement.

PHWD personnel manage the district’s programs as a regional resource, rather than on a by-park basis. The district pools its revenues and allocates funds according to program priorities established by the board.

Due to recent legislation, PHWD will only be able to expend revenue from sources other than ad valorem taxes (e.g., recreation fees) on its parks and recreation facilities built after January 1, 1998. Thus PHWD is justified in requiring that investments in new capital facilities (such as cabins and water slides) be economically self-supporting.

Because PHWD manages the water parks as a regional resource and addresses emergencies, maintenance, and infrastructure on the basis of need, the district’s process for distributing funds to the parks is “fair.”

In FY 2001, maintenance work conducted at Archusa Creek Water Park (e.g., electrical upgrades, bathhouse renovations, equipment repair and replacement, winterization of buildings, road repair) was comparable to maintenance work conducted at the other PHWD water parks.

Over the last three years the Archusa park has received 100 percent of district emergency funds ($1.2 million) for repairs to the Lake Archusa dam. The funds for this single purpose represent 34 percent--one-third--of all intergovernmental revenue raised by PHWD over the last five years.

While PHWD has developed a fair method for allocating resources, it may not be allocating all resources available to the district for park development and operation. In recent years, the district has accumulated a sizeable cash balance.

PHWD’s cash reserve grew from approximately $570,000 in FY 1997 to approximately $2.3 million in FY 2001, an amount greater than the capitalized value of total park assets (approximately $1.2 million in FY 2001).

When conducting this review, PEER also addressed the following specific allegations by complainants:

1. PHWD has not repaired the leaking dam at Archusa.

2. Archusa Lake is filled with aquatic weeds.

3. Archusa Lake is filled with treetops.

4. Archusa Creek Water Park is poorly maintained.

5. Archusa Creek Water Park has inferior infrastructure (e.g., no water slide) relative to other parks operated by PHWD.

6. PHWD has misspent $197,000 by not using a state grant of $100,000 (according to the complainant, to deepen Archusa Lake) and not using $97,000 in proceeds from a timber sale at Archusa Creek Water Park (according to the complainant, to build a water slide for the park).

Some of the complaints are valid (e.g., leaking dam, aquatic weeds, roads in need of repair) and PHWD has been slow in resolving these problems. Other complaints proved to be invalid.

One likely reason for the relatively large number of complaints concerning the Archusa Creek Water Park is that the park is the only PHWD water park where private property owners live on the district-managed lake.

Nineteen months after PHWD repaired the emergency spillway and then discovered new leaks in the Archusa Lake dam, the new leaks have still not been repaired.

The Mississippi Department of Wildlife, Fisheries, and Parks has recommended stocking Archusa Lake with grass carp to control the aquatic weed najus minor, a recommendation a University of Southern Mississippi study made in the early 1990s. PHWD does not plan to follow through on this recommendation until completion of the lake’s dam repair is accomplished.

PHWD does not perceive the location of trees in the lake as a problem because they are confined to an area for fish habitat.

The district has a systematic program to assess the maintenance and repair needs of all nine parks annually, with input from board members and central office and local park staff. The amount and types of maintenance and repair work at Archusa Park are comparable to those being carried out at the other PHWD parks. While Archusa has outstanding maintenance needs (e.g., roads in need of repair), these same needs exist at the other parks.

In April 2001 the board made an official decision not to build a water slide at the Archusa Creek Water Park. The board made its decision after estimating construction costs and analyzing revenues and expenditures of the water slide at Maynor Creek Water Park, the park most comparable in location, size, and attendance to Archusa Creek.

The district did not misspend the amounts in question. The district spent the $100,000 on dam repair in accordance with language in the relevant appropriations bill and placed the $97,000 from timber sales in the district’s general fund.

1. The Pat Harrison Waterway District should take all action authorized under the laws of the state of Mississippi and the Mississippi Rules of Civil Procedure to litigate its claims against Engineering Plus, Inc., for completion of the repair work to the Archusa Lake Dam. It should be noted that PEER has no opinion as to the liability in this case.

2. PHWD should conduct a formal risk assessment to determine the appropriate size of its cash reserve. If the district determines that it can reduce the cash reserve, it should consider the feasibility of expending some of the excess funds on infrastructure needs of the parks (e.g., repairing potholes, placing grass carp in the lake for weed control, upgrading electrical systems, or repairing roads).