Feels like old times

The new agreement “muddles who is responsible for what.”

— Water Authority attorney Craig Justus

Just when it seemed as though a common focus on refurbishing the crumbling infrastructure had brought a cease-fire to the long-running water wars, hostilities between Asheville and the Regional Water Authority of Asheville, Buncombe and Henderson have broken out once again.

This time, the flash point was a memorandum of understanding negotiated by the mayors and staffs of both Asheville and Hendersonville and approved by the two city councils last month. The agreement would give Hendersonville – which is not a member of the Authority — access to its water, whether supplied as “emergency,” “temporary” or “wholesale contract” water. And “as an alternative to expanding its treatment plant,” the document explains, Hendersonville, under certain specified conditions, could request an expansion of the Authority’s Mills River plant, which Asheville owns and operates along with the rest of the water system’s assets. (Hendersonville, however, would have to pay for whatever portion of the expansion was aimed at meeting its own need for increased supply, as opposed to the Authority’s.)

A deal along these lines provides some obvious benefits to both sides. Because its demand for water sometimes reaches 80 percent of capacity, Hendersonville is required by state law to come up with a plan for obtaining access to more water. Meanwhile, the Authority has so much extra capacity that it is considering mothballing — or switching to seasonal operation — at both the Mills River and Bee Tree plants.

Hendersonville’s sole water plant, also on the Mills River, is farther upstream and thus subject to the risk of the river drying up during a severe drought. Asheville’s plant, on the other hand, sits at the confluence of the Mills and French Broad rivers, giving it access to a much larger and more secure (if also more polluted) water supply.

So for Hendersonville, gaining access to the Authority’s excess capacity is an attractive alternative to spending money to expand its own plant at the risk of its water supply running dry.

Meanwhile, for the Authority, finding a buyer for some of the system’s excess capacity would also seem highly desirable, given both the Authority’s financial woes and the steady loss of local manufacturing plants, which has kept demand flat despite a growing population.

Who’s responsible?

The dispute over the agreement, however, seems as much a matter of form as content, since the two cities negotiated and approved the memorandum before the Authority — which would also have to approve it — had even had a chance to discuss it.

When Asheville Mayor Charles Worley presented the agreement at the Water Authority’s April 20 meeting, he caught an earful from its members, who resented being “the last cog in the wheel,” as Authority Chairman Bill Lapsley of Henderson County put it. The Authority voted unanimously to table the agreement for further discussion.

For his part, Worley downplayed the memorandum’s importance, stressing that it had been “staff-driven” and arguing that it does little more than formalize a “handshake agreement” that’s been in effect for years. And David Hanks, the city’s interim water-resources director, explained that the city has already supplied Hendersonville with emergency water on several occasions.

But Authority attorney Craig Justus countered that the deal is quite significant because it brings a new player to the table. “The option to expand [the Mills River plant] lies entirely with Hendersonville,” he noted. And Justus argued that the Authority had always negotiated its emergency-water agreements with other governments and set the water rates (the memorandum specifies that temporary water would be supplied to Hendersonville for 90 cents per 100 cubic feet). The new agreement, he continued, “muddles who is responsible for what.”

Authority board member Patsy Keever, who’s also a Buncombe County commissioner, also questioned why the Authority chairman hadn’t been the one to negotiate the deal. And fellow board member Joe Dunn, who’d voted to approve the memorandum as an Asheville City Council member on April 13, now supported tabling it, expressing reservations about how the city had handled the process.

Meanwhile, Brian Peterson (another Asheville appointee to the board) noted that he differs from most Authority members in believing that the Authority should play a largely advisory role, with Asheville — which owns the assets — holding most of the power. Yet in presenting the Authority with the memorandum as a fait accompli, he observed, the city now seemed to be denying the Authority even the right to function as an advisory body.

Worley repeatedly denied any ulterior motives on the city’s part, noting that the talks had been initiated after Grady Hawkins, chairman of the Henderson County Board of Commissioners, suggested that Hendersonville buy the Authority’s Mills River plant. (Hendersonville, however, wasn’t interested.)

“There was certainly nothing devious about it,” declared Worley. But like Peterson, he also noted Asheville’s special role as the owner of the water system’s infrastructure, arguing that because the deal with Hendersonville involves a potential expansion of a city asset, the memorandum is different from the emergency-water agreements the Authority has previously negotiated.

This sort of bickering between Asheville and the Authority is nothing new. In fact, there was much greater rancor a few years back when they were quarreling about such thorny issues as turning over a Bent Creek property to Henderson County (as required by the 1994-95 Water Agreement) and building a 12-inch line to serve American Freightways in northern Henderson County (which the Authority approved but the city regarded as wasteful and unnecessary).

In fact, since Lapsley took over the Authority chairmanship from Jack Tate in December, relations between the city and the Authority had been quite amicable, with both entities focused on working together with consultants Brown and Caldwell to draw up an asset-management plan and find funding for desperately needed infrastructure repairs and renovations.

Shifting the burden

That task continues. In April, the Authority’s Budget Committee voted 3-2 to recommend implementing the first of three funding options presented by the consultants: a meter-based charge that looks a lot like the capital-improvements fee the Buncombe County commissioners vetoed last year. (The Authority’s budget must be separately approved by the Asheville City Council and the boards of commissioners of both Buncombe and Henderson counties.) The monthly charges would range from $3 (for small residential meters) to $1,300 (for the largest industrial meters).

Peterson, who voted against the proposal (as did Henderson County appointee Shannon Baldwin), explained later that he’d hoped to impose water-impact fees on developers that would have allowed the Authority to reduce the meter charge on small residential users, who already pay more for their water than their counterparts in most North Carolina cities. Large commercial users, on the other hand, pay rates that are much more competitive (or even, in the case of customers outside the city limits, unusually low).

Yet consultant Richard Stahr has pointed out that the meter fees are nonetheless projected to shift the total economic burden somewhat more onto the shoulders of commercial users. And the Budget Committee also voted unanimously to fund a cost-of-service study as a precursor to considering a general overhaul of the rate structure.

The Authority will hold a public hearing on both the funding options and its budget for the new fiscal year (which begins July 1) on Thursday, May 13 in the first-floor conference room of Asheville City Hall, starting at 6:30 p.m.

[Jonathan Barnard is a regular contributor to Mountain Xpress.]