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The Roats Water System has reached an agreement with the state to allow the Bend water company to move forward with buying the Juniper Utility Co. water system, which could mark the end of a costly era for the city of Bend.

The sale of the water system was dependent on the Oregon Public Utility Commission approving a rate increase for the Roats water company. According to state documents filed Thursday, the Roats Water System and the Oregon Public Utilities Commissionhave agreed on all but one issue.

Still, the sale should be finalized in the spring of 2017, said city spokeswoman Anne Aurand. In the near future, city staff will start working with the water company to figure out how it can start taking over the water system.

The city of Bend has been on the hook to maintain and run the Juniper Utility Co. water system for more than a decade, which has led to millions of dollars in legal fees and repairs. Roats Water System will pay $1.4 million for the system, while Avion Water Co. will pay $400,000 for a smaller part of the system, which serves developments including Tillicum Village, Nottingham Square, Timber Ridge and Mountain High.

Bend city Councilor Casey Roats, whose family owns the private water company buying the system, excused himself from the council vote to allow the sale of the system.

“We are hopeful that a full transition could take place before the end of the year,” said Roats. “That is still at this point, however, tentative.”

Roats said his company isn’t ready to release details on the rate increase because it’s still working with the PUC to make final adjustments.

“We are really close, we just can’t say what they are publicly because of the nondisclosure agreements and the fact that they are subject to just a little more negotiation if need be,” said Roats.

While the water company and the PUC have agreed to allow the Juniper water system sale, there’s still a disagreement about an accounting issue, which is unrelated to buying the water system, Roats said. If the company can’t resolve the problem with the PUC, it could go to a contested case hearing next year, said Roats.

While the Roats company initially sought a 32 percent revenue hike — its first rate increase in more than 10 years — Roats said the overall rate increase will be lower than if the sale wasn’t approved because it will spread the cost across a larger number of ratepayers.

— Reporter: 541-633-2160, mriker@bendbulletin.com