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Chatham County would benefit from Western Wake Partners discharge line across east Chatham

By Tom Glendinning
Posted Thursday, December 9, 2010

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Pittsboro, NC - Western Wake Partners is a local government partnership created to solve two problems. It is made up of Apex, Cary, Fuquay-Varina, Holly Springs, Morrisville, and Wake County. Since Jordan Lake became the source of drinking water for the governments, the issue of interbasin transfer has not been addressed. Growth of population and discharge amounts from each city has grown and the WWP partners are located southeast of Raleigh near Chatham County.

Western Wake Partners has done its homework and there is no purpose to second guess them. The flow, temperature, biological oxygen demand and a myriad of other factors are carefully calculated by qualified engineers. The Cape Fear provides adequate aeration for proper dilution of the wastewater. WWP absorbs all the costs. We could benefit immensely by participation. So, the issue condenses to property rights of 12 landowners or the potential for Chatham's future at little cost to us.

I err on the side of infrastructure and recognizing the impending movement of population. If development is coming anyway, make room for it. That "dam" will burst at one time or another. We have huge bills to pay and services to deliver. This immediate problem begs the question of what to do with no new development without raising taxes. Take a moment to look 20 or 40 years into the future. Chatham may have 100,000 to 150,000 people. Septic tanks cannot accommodate them. 16 million gallons per day (mgd) drinking water supply can be allotted from Jordan. The missing link is sewer. 5 mgd of sewage discharge could provide for 70,000 people or 20-30,000 people and some decent industry. 70,000 people at 3.5 per home equals 20,000 new homes. 20,000 homes @ $ 200,000 each (modestly) is $4,000,000,000 tax base, or 41% of our present tax base before the crash. I would wager that the real increase would exceed $ 6 billion, or 60% of our tax base (before the crash of 2008.)

The attractive part of the concept is that, for some cooperation and a small partnership, we would benefit immensely at the tail end of the project by having access to a sewer discharge line. The Haw is at state limits for regulated discharge for Chatham, with all towns above and below able to discharge. The partnership project is infrastructure at its best, the final piece for development, in the richest market (Raleigh/Cary). All engineering has been done. All options laid on the table. Someone else has done the work. All Chatham has to do is sign on, finance 7.7% of the Phase One costs, and let realtors and a new EDC marketer loose to sell Chatham.

One argument against piping the effluent from the Wastewater Recycling Plant into the Cape Fear River at Buckhorn is that it could be put into Harris Lake. Harris Lake drains into the Cape Fear River at Buckhorn, falling from approx. 230 feet elevation at the Harris dam to 140 feet at the Buckhorn dam. So, if the flow into and from Harris is sufficient, it might have accommodated the WWP flow from its plant. I suspect that it is not, or WWP could have saved tens of millions in piping costs and not had to consider another alternative during its planning phase.

The issue is difficult considering priorities of development, tax base, and growth pressures versus private property rights. The challenge is either to make room for the former items, or defend the rights of a few citizens.

In 1980, as I remember, Jordan Lake was finished. The commissioners were offered first pick of water supply allocations. They refused, thinking it would not benefit old Chatham, the rural, red headed stepchild of the Triangle. Now, we must bargain hard for a small allocation or spend lots to obtain water, to which things the present board has refused to commit. We lost the catbird's seat then and could do it again by refusing to participate in this project.

The WWP (Apex, Cary, Fuquay-Varina, Holly Springs, Morrisville, and Wake County) has millions to spend on this as a necessity. We can not afford such a project on our own. They may eventually go to the legislature or court and get their way regardless of what we do. In that case, we would be adversarial rather than friendly.

To place this argument into tax perspective:

Phase One is scheduled immediately upon financing and final approvals for a cost of $ 200 million with capacity for 35 mgd. The pipeline can go in within one year. All five options for discharge involve Chatham County, either to Buckhorn or to Jordan Lake. All involve Chatham landowners and rights-of-way. The Cape Fear has the least environmental effect.

In a Phase I plan worth $ 200 million, 7.7% is $ 15.4 mil. financed over 30 years @ 4.25%(approx. interest, ask Brian Bock for actual) is $ 520,000 per year.

Phase II, the plan worth $ 770 to 900 million long term costs with capacity of 65 mgd by 2030, our part would be very small. For 5 mgd of financed instruments over 30 years, 7.7% is $2.16 mil per year.

Tax revenue would increase at build out by $ 26 million conservatively at a rate of $ .65/$100. Plus, Chatham could receive revenue from the HOA's sewer plants as part of the utilities bill. Cost of participation is less than 10% of revenue increase in tax base at build out. Initial cost of $ 520,000/year is .64% of present budget. A pill to swallow when cuts have to be made, but one that will yield results, unlike a library that smells bad and looks good with an LEED plaque on the wall. If you want to test the waters, ask a realtor what the sewer line option would mean.

See below for tax base increase at capacity for 5 mgd wastewater treatment with 20,000 homes. By 2030, that projection may not be too radical for current market conditions. At least the potential for that number would exist even if only half of them were built.

The real estate market is dead at the moment with anywhere from one year to five years of inventory. When it revives, any location offering sewer treatment will have priority over those offering septic fields. If the facilities were available, commerce and industry would consider us over any poorly served locations. Nota bene: Chatham does not have to build a WWTP (sewer plant.) Developers do that, and pay for the sewer line as well as the tap fee. The county does not have to get into that business or absorb another infrastructure expense.

Mssrs. Goodnight and Preston own 7000 acres east of Pittsboro and intend to build a new city there. That development will be built. These developers have capital and excellent planning. Chatham's move to provide sewer would be backed by that development alone. No plans will hit the county table for that project because it is planned to be in Pittsboro. But Pittsboro can not afford expansion of its plant, nor can it put more effluent into the Haw. A 5 mgd allotment from the WWP would allow this land to become productive tax base rather than languishing in limbo or being relegated to 10 acre homesites.

All of this goes to say that I am for the WWP concept and the involvement of Chatham which will cost little and offer much. With regards to property rights, one of the original bundle of rights (English law and US property law) is to sell the property or lease it. I will not venture into the arguments for or against eminent domain. Bud Holder, a local realtor, accepted the US Army Corps offer for a family farm in Jordan Lake. They raised some of the best tobacco in the state there. The family moved and bought elsewhere. After thirty years, he admitted that it was the best thing he ever did, though compensation appeared small at the time.

With good representation, the landowners could get a high price for their land or for the lease for the rights-of-way. As part of the partnership, Chatham could be an unofficial bargainer in the valuations and offers for ROW's on the twelve parcels. In the total package, if WWP gets its way with Chatham as a late coming partner, the line item for land lease/purchase could increase by a million or more and no partner should bat an eye in an initial $ 200 million project or a final $ 900 million project. The appraisal of property at the point of negotiating sale of right-of-way or fee simple, in normal circumstances, would yield results one way or the other. Why not negotiate from a strong, cooperative position rather than a weaker, confrontational one?

The door is still open if we act appropriately and soon. After it shuts, we could live with regrets for along time.

 
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