Sunday, July 3, 2022

With an $8 million funding gap, there’s confusion over who’s footing Brunswick’s sewer expansion bill

At a plant that's already nearing capacity, financial expansion plans don't appear to be secured.

Initial plans to expand Brunswick County's Northeast Wastewater Treatment Plant include doubling the plant's ability to process wastewater, which was nearing 90 percent capacity in 2016. (Port City Daily/Courtesy Brunswick County)
Initial plans to expand Brunswick County’s Northeast Wastewater Treatment Plant include doubling the plant’s ability to process wastewater, which was nearing 90 percent capacity in 2016. (Port City Daily/Courtesy Brunswick County)

BRUNSWICK COUNTY — There’s an $8-million gap in funding for Brunswick County’s sewer expansion plan, a project that has been in the planning stages for three years.

At a Tuesday presentation that covered the county’s Northeast Wastewater Treatment Plant’s expansion last week, a consultant said the cost would be shared between Leland, Navassa, and Brunswick Regional Water and Sewer H2GO.

Related: Leland wants extra-territorial jurisdiction. Brunswick County isn’t interested

But on Wednesday, Navassa’s mayor said the town has no plans to finance the project.

That leaves $8 million in limbo for a project that may only temporarily patch capacity issues in the fastest-growing county in the state.

Already nearing capacity

For $39.1 million, Brunswick County will add a 2.5 million-gallons-a-day (mgd) expansion including new, larger transmission mains to its Northeast Wastewater Treatment Plant (NEWWTP).

Five groups currently send their wastewater flow to the plant: Unincorporated Brunswick County, the City of Northwest, the Town of Leland, the Town of Navassa, and H2GO. According to a 2017 capacity study, conducted by the engineering firm McKim & Creed, both Northwest and Brunswick County use less than their allocated flow.

The 2.475 mgd system hasn’t been upgraded since 2012. Four years later, it was nearing 90 percent capacity.

Navassa and H2GO already exceed their wastewater flow allocation at the NEWWTP, with Leland nearing its allocation. All three have been relied on to provide payments to the county to cover their share of the $39.1 million 2.5 mgd expansion. (Port City Daily/Courtesy Brunswick County, McKim & Creed August 2017 study)
Navassa and H2GO already exceed their wastewater flow allocation at the NEWWTP, with Leland nearing its allocation. All three have been relied on to provide payments to the county to cover their share of the $39.1 million 2.5 mgd expansion. (Port City Daily/Courtesy Brunswick County, McKim & Creed August 2017 study)

The county used less than a third of its allocated flow in 2016; Northwest used less than one fifth, and Leland used about two-thirds. That same year, Navassa billed two-and-a-half times over its allocated flow and H2GO billed 1.2 times over.

When accounting for a 6.8 percent growth rate, applied uniformly to all parties, both Brunswick and Northwest’s use would still not overburden their allocated capacities.

“Right now we have two entities that are over their allocation on a pretty consistent basis,” the county’s utilities director, John Nichols, told Leland’s town Council Thursday. “That’s the Town of Navassa and H2GO.”

McKim & Creed’s 2017 calculations show the expansion — scheduled for completion in 2021, and accounting for a 6.8 percent annual usage increase — would last through September 2028.

In other words, it appears the $39.1 million expansion would only last seven years before requiring another upgrade.

McKim & Creed’s 2017 capacity study estimates a 2.5 mgd expansion to the NEWWTP would provide service until 2028. (Port City Daily/Courtesy Brunswick County)

But on Tuesday, Tony Bowen, a McKim & Creed project manager, said the expansion would last much longer. Noting utility expansions should be planned about 20 years out, he said the upgrade would last through 2035 to 2037. “It looks like that will get you another 18-20 years,” Bowen said.

Expansions that would have tripled or quadrupled NEWWTP’s capacity were considered in 2017, but were later ruled out. On April 16, 2018, the county was ready to move forward with a 1.65 mgd upgrade. The same day, Leland requested to up its allocated use, marking the expansion total 2.5 mgd — doubling the plant’s capacity. This decision, according to Brunswick County’s manager Ann Hardy, had no impact on the plant’s other users.

Part of the decision to expand included counting on three other utilities to pay their part. The county agreed to pay McKim & Creed $1.9 million to engineer the expansion.

“Costs will be reimbursed by participants needing capacity,” the county’s 2018 contract summary with McKim & Creed states.

Cost-sharing plans

The $39.1 million upgrade is just one of Brunswick County’s costly capital projects. An estimated $216 million is needed to cover utility upgrades, although final costs are far from set in stone.

[Catch up on a more detailed breakdown of the $216 utility upgrade plans here]

A $120.8 million revenue bond is currently being sought out, but has not yet been secured. That revenue bond would include financing the NEWWTP 2.5 mgd expansion.

Cost-share estimates shared at Tuesday’s District 5 leadership meeting hosted by the North Brunswick Chamber of Commerce showed each utilities’ contribution, equaling $39.1 million. H2GO is responsible for $18.38 million, Leland for $12.67 million and Navassa would cover $8.05 million.

On Tuesday, neither McKim & Creed representatives nor county leaders indicated one of the utilites would not be participating in sharing the costs.

H2GO’s spokesman, Tyler Wittkofsky, appeared to be under the same impression. Though unsure of whether H2GO’s $18.38 million share would impact its sewer rates, he said the utility planned to pay the county back.

“Yes, we believe all partners will pay pro-rated shares of the annual bond payment based on each entity’s allocated capacity in the NEWWTP expansion and the costs associated with the same,” he wrote in an email Tuesday.

Navassa’s role

However, Eulis Willis, Navassa’s mayor, said Wednesday that the town has “no plans to finance” the project. He also noted the unlikelihood that the Local Government Commission (LGC) would approve Navassa’s 2,000 low-to-moderate-income residents for an $8 million bond.

Mayor Willis said Navassa has no plans to finance the $8.05 million Brunswick County is counting on the town to pay back for its share of sewer allocations at the NEWWTP. (Port City Daily/Johanna Ferebee)
Mayor Willis said Navassa has no plans to finance the $8.05 million Brunswick County is counting on the town to pay back for its share of sewer allocations at the NEWWTP. (Port City Daily/Johanna Ferebee)

Navassa lacks the infrastructure investments and assets many of its municipal neighbors have. The town is home to residents with a higher percentage of service industry employees and in general lower median income compared to its neighboring municipalities.

But NEWWTP plans wouldn’t require Navassa to take out a bond. An interlocal agreement between Leland and Brunswick County, signed spring 2018, shows Leland will make semi-annual payments to the county over a 20-year period.

When asked specifically about Leland’s interlocal agreement, and whether Navassa intended to make payments on its share of the county’s bond, Willis maintained the town did not.

“The town has not discussed financing this project other than [emphasis added by Willis] exploring the possibility of LGC approval,” Willis wrote in an email.

According to Hardy, the county’s manager, Brunswick County has hosted multiple meetings including expansion participants on a quarterly basis since summer 2017. She also noted McKim & Creed consultants and county staff members have met individually with each participant.

Two interlocal agreements unsigned

Interlocal agreements, drafted by the county, were provided to all participants in April 2018, Hardy said.

“The Town of Leland has returned an executed agreement to the County,” she wrote in an email.

Agreements signed by H2GO or Navassa were not mentioned. (When the agreements were sent out, H2GO was, and remains, in litigation with Leland and Belville. H2GO’s assets are under Belville’s control, pending the resolution of the year-long lawsuit.)

“The county is committed to providing the sewer services as agreed to in the sewer service agreements with the regional participants,” she said.

Hardy did not directly answer whether the county has plans to financially cover the $8 million currently designated to Navassa on its own. But she did emphasise the county’s commitment to seeing the project through:

“The county is making every effort to ensure that the communities have the sewer treatment capacity needed to serve citizens and meet the needs of our communities. As the owner and operator of the sewer system, the county will take all steps needed to meet all state permit requirements and provide excellent service to our system participants.”


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

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