As government goes, it was an eventful three days. In a special meeting June 30 (which was actually a continuation of City Council’s work session two days earlier), Council members marked the passing of the Water Agreement with final words of thanks to city staff (and one another), reassurances to the citizenry — and lamentations aimed at state legislators.
After a year’s notice, six months of wrangling, and much bad blood exchanged, the 24-year-old Water Agreement between Asheville and Buncombe County is finished. But despite last-minute attempts at a deal, the split was not a clean one. Eleventh-hour legislation handed down by the General Assembly on June 29 not only limits Asheville’s ability to control water rates (which the city knew might happen), but also poked a $1.1 million hole in a budget that, under state law, had to be approved by midnight of the very day the Water Agreement was terminated.
Besides barring Asheville from charging customers outside the city limits more for water and forbidding the use of water service as an annexation tool, the twin bills (known as Sullivan II and III) also handed city leaders an unwelcome surprise, prohibiting the diversion of water revenues to fund other budget items.
Council had discussed a five-year phaseout of the long-standing practice, but state legislators made the change effective immediately. This created a $1.1 million shortfall in the city’s 2005-06 budget — approved a mere 24 hours before during the June 28 formal session.
A last-ditch effort: Tuesday
At the June 28 session, some Council members were still hoping to avoid both legislative interference and a looming court battle.
Earlier that day, City Council and the Buncombe County Board of Commissioners had taken a last unsuccessful stab at hammering out their differences (see “See You in Court” elsewhere in this issue).
And later, in the Council chamber, Council member Brownie Newman tried to extend a hand of diplomacy toward both the commissioners and concerned county water customers. Newman proposed a resolution stating that water rates outside the city limits would not exceed those charged inside the city for at least one year. The intent, he said, was to encourage future negotiations with county leaders and make a show of good faith to county residents who feel they’re getting burned by the unraveling of the Water Agreement. The resolution also promised that Asheville would never make annexation a prerequisite for water service.
But the resolution was not without teeth. Reflecting the pending legislation in Raleigh, Newman’s measure included a provision canceling the proposed yearlong moratorium on higher county water rates if state legislators passed the Sullivan acts.
Council also threatened to sue the General Assembly if it went forward with the legislation.
But with frustrations running high after the earlier sit-down with the county, City Council was divided over the usefulness of Newman’s resolution. With no accords reached during the full year since the city announced its intention to withdraw from the Water Agreement, Council member Joe Dunn wondered why Asheville should make further efforts to resolve the dispute. “To go any longer is counterproductive,” said Dunn.
Vice Mayor Carl Mumpower agreed, saying: “The commission is not negotiating in good faith. They made it very clear that there is no breathing room.”
But Newman maintained that the resolution could be a way to neutralize the threat of a court battle, which he said would surely happen if the Sullivan Acts passed.
“These are two pieces of legislation that are very hostile to [Asheville],” said Newman. “We owe it to our community to take every last effort in our power to keep this issue out of court.”
Council member Holly Jones supported the proposal, saying it would combat rumors in the community concerning Asheville’s future annexation plans. And though Council members have sometimes disagreed about the best way to proceed, Jones insisted that City Council was united in its commitment to negotiating an end to the Water Agreement.
“At every turn, we were shot down,” asserted Jones. “While we may not have a unified [position], we were all ready to work.”
And with that, Jones appealed to city residents directly, warning them of the consequences of a court battle and encouraging them to contact their representatives in Raleigh to protest the water legislation. “Instead of your [state] taxes going to schools, going to universities, they will go to legal fees to fight your city,” she predicted. “In 48 hours, it’s pretty much in your court.”
In the end, Newman’s proposal passed on a 4-3 vote, with Mumpower, Dunn and Council member Jan Davis opposed.
Later that day…
But with the budget deadline looming, City Council had more than water on the brain on June 28.
Last-minute budget scrambling is nothing new — every year, staff and Council go down to the wire to balance projected expenditures and revenues. And there had already been some rough spots on the road to this year’s $103 million budget. As the water negotiations failed to bear fruit in recent months, the looming dissolution of the Water Agreement — which would cancel various annual reimbursements from the county — had raised the specter of a $2.5 million shortfall. The sale of property to the Asheville Regional Airport Authority earlier this year produced a one-time $1.5 million gain that helped make ends meet, but various Council members were still trying to find funds for initiatives that hadn’t made the cut in the draft budget — and to rescue some that had been axed in a work session the previous week.
Newman, for example, revived his plan to provide every Asheville police officer with a cruiser full time, but the discussion hit a snag when Newman suggested that the money come from a cap on raises for city staff. Other funding suggestions abounded, from tapping the Housing Trust Fund to diverting money earmarked for repairing the Civic Center roof.
And then Asheville’s new city manager, Gary Jackson, weighed in, saying, “At this point, it is very difficult to unravel the consensus you arrived at last week.” In his first appearance at a formal session since being hired, Jackson suggested that staff return in 90 days with funding options for the police cars.
Bellamy, meanwhile, wanted to revisit the contentious issue of cutting city co-sponsorship of events, which had been used to help make up a $2.5 million shortfall in an earlier version of the budget. Dunn maintained that while city residents are free to donate to the charitable organizations that often sponsor such events, such city support amounts to forcing taxpayers to underwrite these charities via city property taxes. But Bellamy reminded him that for some of these groups, the event is a major source of funding.
Parks and Recreation Director Irby Brinson said that about half of the event funding slashed during prior budget wrangling could be restored by scrutinizing other budget items more closely, but that Council members would still need to pare down the list of events they want the city to participate in.
Faced with an impending deadline, however, City Council unanimously approved the budget on Tuesday, with the understanding that staff would come back in 60 to 90 days with suggested amendments that could pay for currently unfunded programs.
But at that point, Council members didn’t know about the $1.1 million curve ball en route from Raleigh.
Surprise, surprise: Wednesday
On June 29, Mayor Charles Worley and City Attorney Bob Oast journeyed to Raleigh to appeal to the General Assembly. Armed with the newly approved Council resolution, they appeared before the Senate Committee on Local Government — only to discover that the wording of the draft legislation had been altered to expressly forbid Asheville from diverting water revenues to fund other budgetary needs.
Because of the immediate financial impact on the city, Worley asked the committee to hold off on releasing the bill for a Senate vote, he told Council members the following day. “There was no need to rush on this bill,” Worley said on June 30. “We weren’t going to change the status quo while in unfinished negotiations with the county.” Nonetheless, he said, the bill was released from committee and was passed within a matter of hours.
“It was on a fast track,” Oast agreed. “There is no question about that.”
Council has threatened to sue the General Assembly if Sullivan Acts II and III passed, but at press time, no further information was available.
All Dried Up: Thursday
On June 30, there was little left to do but survey the damage.
Council and staff were quick to assure both city and county water customers that it would be business as usual on Friday. “We have a well-thought-out transition plan to make sure no services are interrupted,” said Jackson.
Interim Water Resources Director David Hanks echoed Jackson’s statements. And Irby Brinson said, “The general public should not notice anything different.” (With the end of the Water Agreement, responsibility for maintaining several recreational facilities the county had been handling — including McCormick Field and the Municipal Golf Course — reverts to the city.)
As for the budget, Jackson said staff is already developing recommendations on how to make up the $1.1 million shortfall, and he expects to report back to Council in two or three months with options for amending the budget. The worst-case scenario, he said, is that the city would dip into its $29 million fund balance — a kind of savings account maintained for emergencies — which is healthy enough to survive a $1.1 million withdrawal.
“It’s not at a crisis point, but dollars are very tight,” said Jackson.
But as comforting as these reassurances were, Council members also had some choice words for state legislators who supported the Sullivan acts.
“Those delegates have forgotten that a good number of the people they represent live inside the city,” Davis proclaimed to an audience consisting primarily of press and city staff.
“I hope the citizens of Asheville will make sure their voices are heard,” Bellamy chimed in.
Council members also expressed relief that a long, arduous and ultimately unfruitful negotiation process was over.
“I feel good that at least we know where we are now — and what we have to do to go forward,” said Davis.
Welcome to Asheville
Despite the dark, watery clouds hanging over the budget session, Council members also managed to conduct some other business. In a series of separate votes, Council formally completed the annexation of six areas south of Asheville: the Ridgefield Business Park, Ascot Point Village, Two Town Square, Town Square East and portions of Long Shoals and Airport roads. Each area was annexed separately so that if one is challenged in court, the rest won’t be affected.
All the votes were 6-1, with Vice Mayor Carl Mumpower opposed. Mumpower cited ideological differences, calling annexation “practical but less than principled.”
Of note was Council member Joe Dunn‘s support for the annexations — his first such vote during his three years on City Council. In the past, Dunn has refused to support annexation, insisting that the city needs to focus on what he sees as badly needed improvements within the existing city boundaries — specifically in law enforcement, drug enforcement and pressuring the General Assembly to allow Asheville to institute a room tax to raise revenue.
“I think this Council has finally seen the light on this,” said Dunn, noting that this year’s budget includes money for new police officers and increased drug interdiction, and that there has been communication with Raleigh about a room tax.
There are vacancies on the Citizens/Police Advisory Committee (for a West Asheville resident) and the Public Art Board. The application deadline for both positions is July 14. Call 259-5601 for more info.