Press release from North Carolina Dept. of State Treasurer:
The city of Charlotte (Mecklenburg County) operates the largest public water and wastewater utility in the Carolinas. With water accounts and sewer accounts expected to increase by 1.9% and 1.8%, respectively, in 2025, the city filed an application with the Local Government Commission (LGC) for more than $1.1 billion in financing to meet present and future needs.
That was among a number of items on the agenda that the LGC approved at its meeting on Tuesday, June 4.
Charlotte’s two-part request included $610 million in revenue bonds that will be issued to pay off previous debt incurred through a bond anticipation note (BAN) for water and sewer infrastructure improvements and additions. BAN financing is a short-term debt instrument issued in anticipation of a future bond issue. The LGC approved the BAN in 2022.
Commission members on Tuesday approved a separate request for $500 million in BAN financing for water and sewer infrastructure projects. Charlotte Water is the utility serving more than 1 million customers in the city and greater Mecklenburg County with about 116 million gallons of water and 85 million gallons of treated wastewater daily. The utility anticipates an annual increase of 5.75% in water/sewer rates from fiscal years 2025 through 2029.
The LGC is chaired by State Treasurer Dale R. Folwell, CPA, and staffed by the Department of State Treasurer. It has a statutory duty to consider applications for most debt issued by units of local government and public authorities in the state. The commission examines whether the amount of money that units borrow is adequate and reasonable for proposed projects and confirms the governmental units can reasonably afford to repay the debt. It also monitors the financial well-being of more than 1,100 local government units.
In other matters, LGC members approved a resolution to return financial control of the Town of Kingstown (Cleveland County) to its elected board and properly designated fiscal officers effective July 1, 2024. The LGC assumed control of the town’s financial affairs on Dec. 1, 2020, after the municipality fell behind in mandatory reporting of state audits and had other violations of the Local Government Budget and Fiscal Control Act.
Commission members also heard appeals from several local governments relating to non-compliance with statutory audit requirements. County and municipal audits were due Oct. 31, 2023, following the June 30, 2023, fiscal year end. Recent changes to the law allow for the LGC to direct the withholding of a portion of sales tax distributions if a county or municipality fails to file a copy of its annual audit report within 12 months of its fiscal year end. Local governments may appeal this potential action by the Commission. Information on the law and its implementation are available on the Department of State Treasurer’s website.
A host of other applications was approved by the LGC, including those from the Asheville Housing Authority (Buncombe County) and the Durham Housing Authority (Durham County), which were given the go-ahead for $28 million each in conduit revenue bonds for multifamily housing targeted at lower income households.
The Asheville authority will loan proceeds to Meribel to finance a portion of the costs to acquire and equip five buildings in a 158-unit housing development to be known as Meribel, located in Weaverville. The Durham authority will loan proceeds from its bond to Dearborn Family, LP, to finance part of the costs to acquire, build and equip a 156-unit housing development to be called Sankofa Landing on Old Oxford Road.
Other financing requests approved were from:
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Asheville (Buncombe County) for a $598,650 State Revolving Fund loan to inspect water lines in the Shiloh community and build an inventory for future replacement. About 30% of 246 unknown service lines are suspected to be lead.
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City of Brevard (Transylvania County) for an additional $233,085 to complete the demolition and replacement of a 1 million-gallon water tank.
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