New details emerge in Angler water, sewer deal

Following several months of closed session negotiations and closely guarded financials about Angler Development’s public-private proposal to build a water and sewer system in the county, Salem Supervisor Tom Underwood opened up with some details at Wednesday’s early morning meeting of the Town and County Interaction Committee.

His update was enlightening.

But town leaders, hearing about the county’s long-term financial commitment associated with the deal, expressed concern about the risk.

Underwood, the board’s newest member and a frequent voice against closed door meetings, said he recently met with Angler manager Steve Vento regarding what it’s going to take, money-wise, to pull off the so-called “Culpeper County Water and Sewer Project.”

Angler and its various partners proposes to fund the estimated $100 million project through the Virginia Public-Private Education Facilities and Infrastructure Act.

But details of how exactly that would work and what would be required from the county have remained murky — until now.

New details

In his recent meeting with Vento, Underwood said, he learned that financing for the project — a 2.5 million gallon sewer treatment plant along Mountain Run, two 1-million gallon water tanks and 24,000-linear-feet of pipe — had been finalized. Underwood said a letter spelling out “what that means for the country process” would be forthcoming.

Public hearings on the matter will take place in June, he said, and a draft of the “comprehensive service agreement” will be ready by July.

As for how the proposed project would be financed, here’s where Underwood offered new details. Tap and access fees sold by the county government would pay for it, he said.

Underwood said the county would sell 128 tap connections per year for 25 years.

A single tap fee would start at $30,000, he said, and increase by 5 ½ percent every year.

“You do that it would cover the debt and allow the facility to operate,” Underwood said.

Town: “bad vibes”

Vice Mayor Billy Yowell, while admitting he was not aware of all the plan’s details, said he’s picked up on “bad vibes in the community about this.”

“I’ve been getting a lot of calls from citizens saying they are disappointed the county is doing this,” Yowell said. “They are worried about the financial impact.”

Councilman Duke duFrane, a longtime member of the town’s water and sewer committee, asked for clarification about the Angler proposal.

“Is the general scheme that the debt will be financed with the sale of taps and is there any risk to the general public if the sale of taps don’t materialize?”

To which Underwood responded, “Yes and yes.”

The freshman Supervisor, owner of a land and cattle company, said the proposal provides for Culpeper County to “guarantee” the aforementioned annual tap sales for the first five years.

“If the county did not sell 128 taps every year then at the end of five years you look at it and do a true up,” Underwood said of balancing the Angler investment. “The money would have to come from somewhere,” he added.

“That’s the way it works.”

Nothing final yet

Culpeper County Administrator Frank Bossio admitted it could be a gamble.

“The risk is always there,” he said, mentioning “a buyout provision” and an option “to freeze the tap fees.”

But Bossio said the same risk exists for the town’s water and sewer system.

“If you don’t have tap fees, somebody has to pay for that.”

DuFrane disagreed.

“Looking at the county residents it seems to me they are going at risk for something that may or may not benefit them,” he said, whereas town citizens have a system in place. “I guess we are concerned about that.”

County Attorney Dave Maddox put the brakes on the discussion, saying the board of supervisors has not acted to adopt the Angler proposal or the proposed financing method.

“None of that may come to bear fruit,” he said.

Angler is just an applicant at this point, Underwood said, not a county partner.

“Enough said,” duFrane said.

Allocation extension?

In a related matter, Bossio broached another sensitive subject: the county’s “wasteload allocation” — the amount of treated waste, as regulated by the Department of Environmental Quality, that an entity can dump into the Chesapeake Bay Watershed.

The county obtained the allocation several years back even though it did not have a sewer treatment plant. It has until 2010 to build said plant or it loses the allocation.

Town officials felt the county applied for and received the allocation behind its back and in competition with its system since the DEQ limits its allocations per locality.

That’s why Vice Mayor Yowell was not too keen on a request from Bossio at Wednesday’s meeting that the town write a letter to the DEQ in support of “an extension” of the county’s 2010 deadline.

Bossio said the DEQ is “keenly interested” in a regional water and sewer approach and that could actually be possible considering the pending separate proposal to consolidate the town and county into one new county.

“That’s a tough one for me,” Yowell said of writing the letter in support of a deadline extension. “It’s a great political move, but I’m still reeling over the fact the county requested the allocation and got it through the back door.”

The town felt it would “somewhere down the road” use the allocation the county obtained, he said, and was surprised when the county applied for it, he said.

“From my point of view, I don’t know what reason I would have to support that,” Yowell said of the letter.

For years, the town and county have unsuccessfully attempted to form a regional water and sewer authority. In recent years, the effort has stalled because the town wants to grow its boundaries in exchange for contributing its utility assets and customers to the authority, a request on which the county is not sold.

In the meantime, Underwood said Wednesday, “The town is doing its own thing” — upgrading and expanding its sewer treatment plant — while the county is “looking at” building its own 2.5 million gallon sewer plant through the Angler deal.

“If there were anyway to come up with a joint plan that would still be the best way to go forward,” he said.

Separate plans that overlap in service areas, Underwood said, will only “hurt the ratepayers.”

If a joint plan could be developed that took into account the value of the town’s utility assets, Yowell said, he would support it.

Another committee?

Finally, the committee discussed forming a committee of private business people to help the town and county arrive at the regional authority goal.

Perhaps “a new set of eyes” of people “who don’t have a dog in this fight” could help facilitate that, said Supervisor Sue Hansohn, in the audience at Wednesday’s Interaction Committee meeting.

DuFrane seemed open to the creation of the committee, asking for more information on it. Hansohn agreed to provide that.

Allison Brophy Champion can be reached at 825-0771 ext. 101 or