Saturday, February 4, 2023

Leland and H2GO propose consolidation of services, assets after long legal battle

H2GO and the town of Leland will each consider the proposal during meetings next week. (Port City Daily photo/Johanna Still)

LELAND — The Town of Leland announced it is considering an agreement with Brunswick Regional Water and Sewer, better known as H2GO, to consolidate the utilities of the two water providers “[i]n the spirit of cooperation and unity.” 

Since late 2017, the two have been involved in an often contentious, multi-million-dollar legal battle over H2GO’s assets in northern Brunswick County, which also involves the nearby town of Belville. Leland and Belville have fought over the rightful title to H2GO since the latter’s outgoing board members transferred all of its assets to Belville on Nov. 28, 2017.

RELATED: After nasty court battle, H2GO prepares to break ground at RO plant

Leland sued days after the transfer, and a superior court judge sided with the town in April 2019. Belville filed an appeal shortly after, and when the two towns attempted to reach a settlement in the summer and fall of 2019, the talks veered off course with the chairman at the time declaring the proposed agreement “dead.”

Ultimately, Belville returned H2GO’s assets and the utility provider has continued governing itself. 

“Northern Brunswick County is one of the fastest-growing areas in North Carolina and is expected to experience continued residential and commercial development,” according to a joint statement by Leland and H2GO issued on Tuesday. “As the area grows, it is necessary that the region’s entities work together to effectively and efficiently plan for and address current and future water and wastewater needs.”

Under the proposed agreement, Leland and H2GO would consolidate their water and wastewater systems and their utility funds to “gain efficiencies in operations, enhance sustainability, reduce redundancies and overlaps, and improve customer service.”

The town said H2GO was well-positioned and well-equipped to operate the consolidated water and wastewater systems.

A public hearing on the proposed joint ownership and operation of the water distribution and wastewater collection systems will be held at the Mar. 18 Leland Town Council meeting at 6 p.m. at the Leland Town Hall.

H2Go will consider the agreement at its next regular meeting at 6 p.m. on Tuesday, Mar. 16.

Belville spokesman Mike McGill promised a release from Mayor Mike Allen, but an hour later he said the town had decided to hold off on comment until the statement was released before the proposed agreement was made publicly available on Wednesday. 

Aside from his role as the town’s spokesman, McGill serves as president for WaterPIO, a communications consulting firm for water and wastewater utility providers across North Carolina.

The proposed agreement specified areas of the region where  H2GO and Leland would “be able to expand their services jointly, and other areas where H2Go could expand separately,” according to the release.

“By doing so, both entities would be able to grow in a coordinated and unified manner, eliminating uncertainty regarding the provision of utility service. In addition, a consolidated customer base could take advantage of economies of scale as they relate to rates and pricing,” according to the joint statement.

The drafted proposal states that H2GO “shall be solely responsible” for the operation and provision of services. 

“[H2GO] has the right to develop and implement policies or conditions for the Provision of Service(s). Leland will have no day-to-day obligation or authority, however, will cooperate with [H2GO’s] efforts, in the Operations of the Joint Assets,” according to the drafted proposal.

It also outlines Leland’s plan to support H2GO’s efforts to secure financing should the joint ownership of any joint asset “affect [H2GO’s] ability to finance projects.”

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