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Wednesday, May 22, 2024

Leland asks H2GO to curtail future growth, hand over hundreds of customers, and pay fees

Current co-plaintiffs in a lawsuit against Belville regarding retaining $60 million in water and sewer assets, Leland and H2GO could enter into a new agreement. The agreement, drafted by Leland, would require H2GO to not provide sewer service to an area it currently serves, where H2GO's $3.2 million system is about to be completed.

Leland prepared an agreement, which H2GO will soon vote on, that would prevent H2GO from providing sewer service to an area it currently serves. (Port City Daily photo/Johanna Ferebee)
Leland prepared an agreement, which H2GO will soon vote on, that would prevent H2GO from providing sewer service to an area it currently serves. (Port City Daily photo/Johanna Ferebee)

BRUNSWICK COUNTY — Leland wants H2GO to stop providing sewer service to an area it already serves, a part of the county where H2GO has spent $3.2 million to construct a new system.

The request is part of an agreement the town sent Brunswick Regional Water and Sewer H2GO in July and could be approved by H2GO on Monday.

RELATED: Leland seeks to ‘rebrand’ industrial park in unincorporated Brunswick County limits

Red lines

The document, entitled “Agreement Regarding South 17 Corridor Sewer,” includes the following line:

“H2GO agrees that it will not provide sewer service or extend any sewer lines within any areas lying to the north, west, and south of the red line shown on Exhibit C attached hereto and incorporated herein by reference.”

This is the only line in the agreement that explicitly outlines Leland’s request for H2GO to not provide service outside an area designated in a map labeled “Exhibit C” in the agreement. The document does not mention the fate of H2GO sewer customers currently served in the area’s prohibited by Leland’s new requested service limits.

Exhibit C, which shows where H2GO cannot provide sewer service to if the agreement is passed, can be viewed in full below:

Leland wants H2GO to stop providing sewer service to the area outside the red lines in the above map, where it currently serves approximately 400 customers. (Port City Daily graphic/Courtesy Brunswick Regional Water and Sewer H2GO)
Leland wants H2GO to stop providing sewer service to the area outside the red lines in the above map, where it currently serves approximately 400 customers. (Port City Daily graphic/Courtesy Brunswick Regional Water and Sewer H2GO)

Approximately 400 current H2GO sewer customers fall outside Leland’s new proscribed service area, according to H2GO spokesperson Tyler Wittkofsky.

The agreement does not outline whether those customers would no longer be served, or whether Leland would assume the obligation of service. When asked what would happen to those customers, Wittkofsky said it’s a question for Leland, since the town drafted the document.

Leland’s economic and community development director, Gary Vidmar, sent the agreement to H2GO’s executive director in late July. He did not immediately respond to Port City Daily’s inquiries for clarification on what the agreement would mean for current H2GO customers.

Belville, currently a defendant in a lawsuit against co-plaintiffs Leland and H2GO, strongly opposes the proposed agreement. Last November, H2GO’s outgoing board voted to transfer all its assets to Belville before its newly elected members took office.

According to a court order issued in January, Belville technically retains ownership of H2GO’s $60 million assets; this ownership is still being contested by all three parties in Brunswick County Superior Court.

“We have sent a letter to Leland and H2GO stating that this is a clear violation of the court order,” Belville’s spokesperson, Mike McGill, said in a statement. “If they choose to violate the court order, we will take legal action.”

Control of sewer service along Highway 17

In addition to containing H2GO’s sewer service, Leland wants to control HWY 17’s southern corridor.

Leland’s agreement states H2GO has encountered “certain difficulties” in providing sewer service to three subdivisions off HWY 17: Snee Farm, Stoney Creek, and Grayson Park.

Wittkofsky said though the area has had pressure issues, H2GO’s plan to fix them has been underway for three years. H2GO’s interceptor sewer system, a $3.2 million project, could be completed in 120 days.

The new system would solve the existing pressure issue, Wittkofsky said. It would also allow for growth — H2GO’s interceptor is sized to handle approximately 4,500 homes; 900 currently exist, 1,600 are permitted, and 2,000 more not-yet-permitted homes in the HWY 17 corridor could connect to the new system.

“The system was designed and constructed as the first step to extend sewer service to the south US-17 corridor, west of the [Military Ocean Terminal Sunny Point railroad],” Wittkofsky said.

When it’s completed, the system is expected to manage existing wastewater flows in Grayson Park, Stoney Creek, and Snee Farm. However, all three of these developments are located outside of Leland’s requested service limits for H2GO.

Meanwhile, in the same area, Leland is planning a sewer system of its own.

According to town council minutes, one month before the agreement was sent to H2GO, Leland paid an engineering firm $303,500 to design sewer services on the southwestern corridor of Highway 17. Plans currently include three new lift stations, set to begin construction as early as March 2019.

Sewer would be handled by Leland’s new lift station, the agreement states, but would be pumped through H2GO’s existing lines or new lines planned to be constructed.

The agreement would require H2GO to pay Leland a fee for accepting sewer flow in the three neighborhoods in question, with an added charge of 5 percent.

H2GO would be financially responsible for constructing – or relocating its current lines – to connect to Leland’s new lift station on Hewlett Burton Road.

Leland's sewer expansion plans include the exact same service area as H2GO's $3.2 million interceptor sewer system, currently under construction, with 120 days until completion. (Port City Daily graphic/Courtesy Town of Leland)
Leland’s sewer expansion plans include the exact same service area as H2GO’s $3.2 million interceptor sewer system, currently under construction, with 120 days until completion. (Port City Daily graphic/Courtesy Town of Leland)

H2GO to vote this week, Leland too?

Whether or not H2GO agrees to Leland’s terms, which would reduce its current and future number of ratepayers while still requiring the utility to invest money as well as pay Leland directly, is solely up to H2GO; as a sanitary district established by the General Assembly, H2GO does not formally answer to any local jurisdiction besides the state itself.

It does seem that H2GO Board Chairman Jeff Gerkin disagrees with the utility’s attempts to expand aggressively; in June, Gerken said he did not believe H2GO should “grow and grow and grow without bound.”

Entitled “Cooperation between H2GO and the Town of Leland” on H2GO’s meeting agenda, Leland’s proposed agreement, which would effectively curtail the utility’s growth, will be introduced by Gerken on Monday, Aug. 27.

Meanwhile, Leland announced a special meeting of Town Council for the day after, to be held on Tuesday, Aug. 28, at 1 p.m. Leland officials have not responded to questions whether the meeting was planned to approve the agreement – pending H2GO’s acceptance. Leland’s special meeting agenda has one item: “Town attorney proposal review.”

Leland’s drafted agreement has not yet been discussed publicly in recent Town Council meetings. If formally agreed upon by both parties, the agreement would remain in effect for a 20-year period, with an automatical renew for a second 20-year period unless otherwise terminated.

View the agreement in its entirety below:

Leland, H2GO Agreement by Johanna Ferebee on Scribd


Send tips and comments to Johanna Ferebee at johanna@localvoicemedia.com

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