LELAND — After back-to-back special meetings Friday, the Town of Belville and Brunswick Regional Water and Sewer H2GO are seeking options to end northern Brunswick County’s yearslong, ugly utility dispute.
Neither board took action in open sessions at their respective meetings Friday, but on Monday H2GO announced a proposed a settlement agreement between itself, Belville, and Leland.
Related: With power shift, new H2GO board lifts staff gag order, litigation attorney resigns
H2GO proposes a settlement agreement that includes action only Belville could take — dropping its appeal of the lawsuit; while the letter indicates Belville is ‘supportive’ of the move, the settlement proposal was delivered as solely from H2GO, not as a joint H2GO-Belvielle offer.
Besides dropping the appeal, H2GO offers to pay Leland $800,000 in legal fees. As of September 2019, Leland’s legal fees totaled more than $879,701.30.
The offer expires Feb. 21. It includes the following stipulations, according to the letter:
- Belville will transfer back H2GO to H2GO
- H2GO will pay Leland $800,000 to cover attorneys fees (Belville and H2GO “dispute this request for costs” according to the letter
- Both Belville and Leland drop appeal and cross-appeal within 10 days of signing settlement agreement
- All parties move to remove the restriction in district court preliminary injunction that stops work on the planned RO plant
- Leland will withdraw its cross-appeal asserting H2GO violated Open Meetings Law (the court found H2GO did not violate this) and its request for attorney’s fees
- Leland won’t interrupt RO plant planning
- All three governing boards approve a settlement agreement
Leland, H2GO v. Belville
The contentious legal case, now sitting in the N.C. Court of Appeals, has cost taxpayers and ratepayers at least $2 million dollars in legal fees among the three government entities entangled in the suit since it was filed in late 2017.
At the Friday meeting, H2GO officials were unusually tight-lipped. Several, including its spokesperson, stated they had “no comment.” But in a Monday press release, H2GO announced it sent the Town of Leland and the Town of Belville a settlement proposal Friday. Asked why H2GO waited to announce the decision, Tyler Wittkofsky, H2GO’s spokesperson, said the utility wanted to give Leland officials time to review the proposal (read the proposal at the bottom of this article).
Dropping the lawsuit altogether would require either a settlement agreement approved by the courts or the Town of Leland to withdraw its original suit, filed in 2017. Under H2GO’s proposed agreement, Belville would transfer H2GO’s assets back to H2GO (as the district court ordered in April 2019) so long as all three parties agree to lift the current restriction imposed via a Jan. 2018 preliminary injunction that bars H2GO from moving forward with the RO plant.
“The Town is evaluating the proposal,” Leland’s spokesperson provided in a statement Monday.
How’d we get here?
On its face, the lawsuit is about a multitude of issues, including: political differences over whether or not H2GO’s planned, permitted, and partially-constructed $30 million reverse osmosis plant should be built; the power to negotiate new utility connections with developers in a region fraught with competition; the legality of a contentious and secretive November 2017 transfer.
Proponents of the transfer, which Superior Court Judge Charles Henry ruled illegal in April 2019, assert it was necessary to “save” the RO plant from being thwarted. Outgoing H2GO Commissioners voted to transfer all $60 million of H2GO’s assets (the entire utility) to the Town of Belville at their last regular meeting on Nov. 27, 2017. This transfer was orchestrated after election results were learned and before new board members were sworn in, which swung the board’s power in opposition to the RO plant.
Belville Commissioners quickly accepted H2GO’s assets less than 14 hours later in a meeting the town had held previously open in recess. The transfer never appeared on an agenda prior to action being taken; the public was completely cut out of the decision.
In his spring order, Judge Henry concluded public officials from both H2GO and Belville that worked on the transfer violated state ethics law. Belville is appealing the order; Leland has filed a cross-appeal.
Boiled down, lead sitting officials on both Belville and H2GO boards today acknowledge the methodology of the transfer raises questions, but ultimately see it as a move that “saved” the RO plant. In contrast, the basic legal argument opposing the transfer can be surmised by the proverb, ‘the end doesn’t justify the means.’
Related: Leland and Belville’s 30-year rivalry is the key to understanding the complex H2GO case
Officials who participated in the transfer assert they had a legitimate reason to fear the plant’s demise — both Leland and Brunswick County had challenged the region’s largest utility politically and legally on the plant in the months leading up to the November 2017 election.
The Town of Leland sued days after the surprise transfer. Once the new H2GO board members took office, Leland and H2GO aligned as co-plaintiffs in the suit against Belville. After the November 2019 election, H2GO’s political power has swung back in favor of the RO plant, 4-1. H2GO is back in alignment with Belville politically, but technically this political adjustment has not taken place legally.
In its announcement, H2GO points to the results of an Environmental Working Group (EWG) study released last week that ranks Brunswick County drinking water at the top of a national PFAS contamination sampling effort.
“With the recent findings presented by the Environmental Working Group, it is more crucial than ever to re-start construction of H2GO’s aquifer-sourced RO Plant. It is up to H2GO and the Towns of Leland and Belville to protect and preserve the health and welfare of our communities.
“It is the hope of H2GO that the Towns of Leland and Belville will join them to provide our community with what they deserve: water that is safe, clean, and free of industrial contaminants,” H2GO’s release concludes.
Read the Jan. 24 settlement proposal below:
Settlement Proposal by Johanna Ferebee Still on Scribd
Send tips and comments to Johanna Ferebee Still at johanna@localvoicemedia.com
