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Council prepares for debate over sewer cost-share agreement
by Brian Wheeler | Saturday, March 15, 2014 at 4:07 p.m.

Two years of closed-door negotiations between the city of Charlottesville and the Albemarle County Service Authority have finally resulted in a sewer cost-sharing proposal.

However, the two city councilors on the negotiating team have reached widely divergent positions as to whether the agreement, if approved after a public hearing Monday, would be a good deal for city residents.

“I think it’s a great deal for the city because it’s fair, verifiable and progressive,” said Councilor Kathy Galvin. “By that, I mean it’s scientifically based and we can distribute the costs of wastewater projects based on actual use.”

However, Councilor Dede Smith said she prefers an existing arrangement in the so-called Four-Party Agreement. That 1973 document, which created the current water and sewer management structure, says the city will pay half as much as the county for new facilities.

“I will vote against it at this point,” Smith said. “Can someone give me a reasonable explanation as to why the city should give up its legal position? What does the city get for giving up [an agreement] that’s to its financial advantage at this point? I can’t think of anything.”

Water and sewer services are regionally administered by four parties: the city, the Albemarle Board of Supervisors, the Albemarle County Service Authority and the Rivanna Water & Sewer Authority.

The draft cost-sharing agreement would establish a framework for financing any debt required to build new sewer infrastructure.

In late 2011, when it was determined a $33.3 million sewer pump station was needed to service both localities, revisiting the cost-sharing arrangement became a priority. At the time, Albemarle officials balked at the city’s insistence that the station be moved out of the Woolen Mills neighborhood for an additional $13 million.

Gary O’Connell, executive director of the Albemarle County Service Authority and the previous Charlottesville city manager, said the negotiations allowed the debate about the pump station to be “taken off the table.”

“We were willing to talk about full cost of that project,” O’Connell said, referring to the more expensive option favored by the city. “We set that aside and said if we can focus on all wastewater projects with a fair method, then the $13 million cost difference is off the table.”


Moores Creek Wastewater Treatment Plant
It wasn’t easy to reach that milestone in the negotiations, and Richmond-based mediator Mark Rubin from the McCammon Group was called in to facilitate the discussions.

Smith said the involvement of the mediator dashed her hopes for leveraging the existing agreement.

“We brought in a mediator, which was the death knell of using the Four-Party Agreement,” Smith said. “Use of a mediator assumes some give and take.”
 

Galvin described the mediator as playing a valuable role.

“It’s not a zero-sum game when you bring in a mediator,” Galvin said. “It’s not battering down the door until someone loses. This agreement makes us come to the middle, and the methodology is fair and not based on anything that’s screwing the city.”

According to language in the document, the agreement is intended to determine cost allocations for not only the Rivanna Pump Station, but also future sewer projects.

“The goal that we had was that the formula would be applied to all projects in the future so we wouldn’t have to come back and have discussions like this,” O’Connell said. “I think that’s good for the community so we don’t have to keep having these arguments and debates, and it also gives you some stability in the rates, which is what most people want.”

Smith said the compromises in the agreement are being driven by her fellow councilors, not by city staff.

“Part of my frustration is we were not using our own [staff expertise] to inform our decision,” Smith said. “This proposal came from City Council. Council drove this much more than staff.”

Smith said she would support a cost-share agreement based upon actual measurements of usage. However, she questions the emphasis the agreement places on severe storm events.

Stormwater can infiltrate sewer lines, increasing the flows to be treated and sometimes overflowing sewage into area streams and the Rivanna River. The new pump station, for example, is being designed to handle these wet weather flows to protect the environment.

“To go to a system that uses an event that happens every two years as the driver of cost is not to the advantage of the city,” Smith argued.

“The reality is that’s what we design for,” O’Connell said. “We are under a legal mandate to remove [stormwater] inflow and infiltration in the system and reduce or eliminate overflows.”

Smith and Galvin both said that when staff applied the agreement retroactively to projects already underway, they calculated the city would hypothetically owe the county $1.8 million to $2.7 million.

Smith said that’s an example of “how bad this agreement is for the city.” She also notes that a project that was previously split between the two localities, the Schenks Branch Interceptor, will now be paid for entirely by the city.

Galvin said the exercise demonstrated instead how Albemarle has been subsidizing the city’s aging sewer system.

“It’s not about sticking it to any one jurisdiction. It’s about what is fair and what each locality is contributing to the flows, and creating incentives to reduce inflow and infiltration,” Galvin said. “It builds foundation for more positive partnerships with the county in the future.”

The agreement also outlines a regular update process.

“In 2015, will go back and put meters in the system to look at it again, and we’ll do that every five years,” O’Connell said. “The agreement takes growth into account more than we originally discussed, and that’s a benefit to the city.”

The City Council will hold a public hearing on the agreement Monday evening. The Albemarle County Service Authority’s board of directors will take public comment at its meeting March 20.

 

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