Asheville City Council

A divided Asheville City Council approved a newly drafted water proposal that some city leaders are calling the last opportunity for a truce before the two sides wind up in court.

“I hope the [Buncombe County] commissioners recognize that our backs are up against the wall,” said Council member Jan Davis. “If this is unacceptable, we have to take our chances and play the hand that was dealt us.”

The proposal was a last-minute addition to the agenda for Council’s May 10 formal session; the day before, Council members huddled behind closed doors to discuss the embattled Water Agreement.

The proposed compromise, drawn up by Council member Brownie Newman, calls for concessions by both sides while seeking to address key issues, such as ownership and control of the water system, and different rates for city and county water users.

The proposal comes on the heels of stalled negotiations, including a controversial closed-door mediation session on April 26 that both city and county leaders have admitted accomplished nothing. It’s now a year since Asheville announced its intention to dissolve the Water Agreement, which will expire June 30 unless action is taken.

Under Newman’s proposal, Asheville would retain ownership of its water assets. The plan also calls for creating a revamped water board with four city appointees and three from the county.

“The majority of water users live here [in Asheville],” noted Newman at the May 10 session. “That is probably the most important reason we got into this.”

In addition, the proposal stipulates that no current water customers would have their service terminated, nor would the city make annexation a condition for providing water service.

The city plan does allow a rate differential, but it would be capped at 35 percent — less than half the state average of 85 percent, Newman pointed out. Still, in the short term, water customers living outside of Asheville could see a 20 to 25 percent rise in their water bills, whereas city residents’ bills would drop by 10 to 15 percent. Those changes, he said, could be phased in to lessen the impact on water customers.

But Newman also emphasized that all water customers will probably have to be charged more to fund needed improvements. “Nobody is saying the rates aren’t going to go up,” said Newman. “The system is going to need an investment.”

He also stressed the need to dedicate water revenues solely to maintaining and repairing the decrepit infrastructure. For years, 7.5 percent of annual revenues (currently about $1.5 million) has been diverted to the city’s and county’s general funds.

The new agreement would be in force for at least 15 years; after that, either party could terminate it with 12 months’ notice.

State legislators wade in

Further complicating things is the fact that the current Water Agreement also covers a host of unrelated matters.

“It’s about more than water,” said Newman. “It’s about tax equity for Asheville and Buncombe County.” Asheville residents, he pointed out, pay both city and county taxes –effectively doubling their tax bills. That underlying issue has led to the inclusion of such items as Police Department/Sheriff’s Department jurisdiction and maintenance costs for facilities used by both city and county residents in the current Water Agreement.

One of those facilities, the Civic Center, also gets a nod in the proposal, which calls for Buncombe County to provide $750,000 in capital-improvements funds for the ailing structure. In earlier negotiations, county leaders had put Civic Center funding on the table as a bargaining chip. The city, meanwhile, would make annual payments of $500,000 to cover operating costs, and the city and county would jointly ask the local legislative delegation for a new funding source (such as a 2-cent hotel-room tax).

That new revenue is the key, argued Council member Joe Dunn, who urged his colleagues to increase the pressure on state legislators.

“We’ve got to have the delegation’s help to do something with the Civic Center,” Dunn declared. “The delegation is going to have to come out from behind the trees.”

Accordingly, he proposed adding a provision that would terminate the agreement if state legislators failed to supply Asheville with some new revenue source.

“If we could get a 2-cent room tax from tourists, we could do almost anything we wanted with the Civic Center,” said Dunn.

But Newman balked at that idea, saying foot-dragging by state legislators could sabotage the plan.

“If the city and county can get an agreement, we don’t want to give the delegation veto power by inaction that will unravel the whole thing,” said Newman.

The focus on Raleigh is hardly a coincidence — the local delegation has gotten deeply involved in the water struggle. Initially, Reps. Wilma Sherrill, Bruce Goforth and Susan Fisher co-sponsored two House bills that would prohibit the city from charging higher rates to county customers. In April, Fisher removed her name from the bills (dubbed Sullivan II and Sullivan III), saying she needed time for further study of the complex issues. The bills would expand the 1933 Sullivan Act, which essentially barred Asheville (alone among North Carolina cities) from charging non-city residents more for water. Recently, Asheville has maintained that most of the areas covered by Sullivan have since been annexed (see “Water Torture,” March 23 Xpress).

Dunn lashed out at the two proposed bills, saying local delegates had failed the city. And County Attorney Joe Connolly even helped draft the bills, noted Dunn.

Newman concurred, saying state legislators “are involved in ways we never wanted them to be. There’s ways they can help other than to overturn the apple cart.” Other language in the proposal would cancel the agreement if the state passed any “anti-Asheville” water legislation.

And Council member Terry Bellamy made a motion — which passed unanimously — that Council send a resolution to the state House demanding that the Sullivan bills be removed from consideration.

A strategy for surrender?

While several Council members complimented the proposal, Vice Mayor Carl Mumpower said it was altogether the wrong tack to take.

“I think this is a strategy for surrender,” said Mumpower, calling the compromise an admission of defeat. The city, he maintained, needs to stick to its guns and reclaim what belongs to it — even if that means the next round of water negotiations is held in a courtroom.

“Asheville is the only city that owns its water assets but cannot manage them,” said Mumpower, who presented his own proposal in the form of a resolution. The no-bones-about-it plan said Asheville would support a regional water authority if the city were given $750 million in compensation for turning over its water assets. Barring that, the resolution said, the city would take over management and cap rates for county residents at no more than half the state average. Mumpower’s proposal also asked the local legislative delegation to drop the Sullivan bills.

In effect, he argued, Newman’s proposal amounts to giving in to the county’s threat of legal action. “We aren’t doing this because we want to,” said Mumpower. “We are being blackmailed. We should call their bluff.”

No motion was made to adopt Mumpower’s resolution.

The vice mayor also lamented that the long, drawn-out negotiations have not produced more tangible results.

“I think we provided more entertainment, frankly, than solutions,” he said, adding that he thought everyone’s minds were made up before they even came to the table.

Despite those fighting words, however, a motion to forward Newman’s proposal to both the Buncombe County Board of Commissioners and the N.C. General Assembly passed 5-2, with Mumpower and Dunn dissenting.

But both sides did agree on one thing: There’s no more time for dawdling.