MINUTES

STATE OF NORTH CAROLINA BOARD OF COMMISSIONERS

COUNTY OF HENDERSON MARCH 10, 2000

The Henderson County Board of Commissioners met for a special called meeting at 10:00 a.m. in the Commissioners= Conference Room of the Henderson County Office Building at 100 North King Street, Hendersonville, North Carolina.

Those present were: Chairman Grady Hawkins, Vice-Chair Bill Moyer, Commissioner Renee Kumor, Commissioner Don Ward, Commissioner Marilyn Gordon, County Manager David E. Nicholson, Assistant County Manager/Interim County Attorney Angela S. Beeker, and Clerk to the Board Elizabeth W. Corn.

Also present were: Finance Director J. Carey McLelland, Planning Director Karen C. Smith, Staff Attorney Jennifer O. Jackson, Utilities Director Jim Erwin, Project Manager Bill Blalock, and County Engineer Gary Tweed.

CALL TO ORDER/WELCOME

Chairman Hawkins called the meeting to order and welcomed those in attendance.

Chairman Hawkins informed the Board that he had received a petition in favor of the BMX track, in case they wanted to review it.

CONTINUATION OF March 6 meeting

BMX LEASE

Chairman Hawkins reminded the Board that they had discussed the BMX lease and asked for some changes which Angela Beeker had prepared and brought back to the Board at this time. She reviewed those changes with the Board.

Following some discussion, Commissioner Moyer made the motion to adopt the lease agreement with the amendment that Commissioner Gordon proposed and approve the resolution. Commissioner Gordon proposed an amendment to paragraph 3 of the Lease that would state that if Lessee=s inability to be open was a result of weather, the consent of the Parks and Recreation Director could be presumed and Lessee would not have to obtain a written consent. A vote was taken and the motion carried four to one with Commissioner Kumor voting nay.

FACILITY GOALS

Chairman Hawkins reminded the Board that Bill Blalock had crunched those goals down to a couple of pages. He stated that he hoped they had all had an opportunity to review those.

It was the consensus of the Board to rename the ANew Facility Financial Goals@ as Guidelines for planning costs.

Bill Blalock will make that change and this item will be back on the agenda for next Wednesday, March 15, 2000.

MUD CREEK WATER & SEWER DISTRICT

Discussion of the Mayor=s letters of February 11 & 23.

Chairman Hawkins stated that he had a couple of letter from Mayor Niehoff. Mayor Niehoff was present and asked to update the Board.

Mayor Fred Niehoff, City of Hendersonville, distributed a letter and read portions of it to the Board. The body of the letter follows:

AAt our City Council meeting last night, we discussed an alternate proposal to that presented in our letter of February 11, 2000. This proposal is a result of discussions between Commissioner Renee Kumor and myself this past week.

Renee and I have often been very vocal opponents on the issue of what to do about sewer in the Mud Creek District, and we felt that the first step should be to sit down and talk to each other and try to come up with a solution to our apparent differences.

Actually, our positions were not that far apart. We looked at the objectives of each of our governing bodies and tried to understand and appreciate them. Those objectives, when you take them out of the context of the 1986 agreement and the various discussions that we have had since then, could be boiled down quite briefly.

From Henderson County=s standpoint, you have been, and will continue to be, installing lines to serve the sewer needs out in the county - farther out than logical annexation would be expected to occur. Those needs are primarily in the area of public health and economic development. You do not want to be in the sewer line maintenance business. But you do need assurance from the City of Hendersonville that we will treat the sewage in the Mud Creek basin upstream from our plant.

From the City of Hendersonville=s standpoint, our main concern is that if we agree to treat that sewage that the County or its customers will pay its fair share for the cost of additional plant capacity needed to treat that sewage.

And from both our standpoints, we want to work together on questions of sewer line extensions (and water lines also) as we continue to deal with the expected continued growth pressures. We must look at defining where the high density growth should occur (which would obviously need water and sewer). We should work with each other on the question of those areas that should logically be annexed in the future (urban in character). And these issues are right in line with the principles of ASmart Growth@ which we all should be interest in.

We felt that if we could agree on these common objectives, we could move forward on a solution of our apparent impasse.

The timing is critical. The D-day for a decision on where to run the Flat Rock line - to your Mud Creek line or to our 176 line - is April 7^th. From an engineering standpoint, and the ongoing maintenance requirements, that line should go to your Shepherd Street line. But if we do not resolve this, it will almost certainly go to 176. And in the long run, we all lose.

At our discussion last night, I asked City Council whether they could subscribe to the basic ideas in the proposal. Here are the results of that discussion:

1. Using the Flat Rock financial arrangement as a model would be acceptable. Those present customers would pay a 90 cents per thousand gallon surcharge for ten years as their share of the new plant capacity. New customers coming on line would pay the system development charge, a good part of which covers the share of plant capacity.

2. We are willing to guarantee that we will treat the sewage from the Mud Creek basin upstream from the treatment plant. Our 4.8 million GPD plant was designed to take care of the needs of the Mud Creek basin. We want that flow to help pay for the new plant. I checked with our engineer Charles Willis, who arrived at that 4.8 million figure, to make sure that in his best estimate this was an adequate figure. He assured me that it was.

3. We are certainly willing, and anxious, to work with the County on the question of long range planning in the expected growth areas. The idea of a five-person committee is certainly a reasonable approach

Our discussion last evening started to drift into details and interpretation of some of the points in the proposal. I commented that there are several points that have to be clarified, or better defined, as we move along in our discussions. The main question right now was >Is Council comfortable with the basic principles as outlined above?= And the answer was yes. I was authorized to speak to you this morning and discuss this proposal.

I would respectfully suggest that in your discussion of this proposal, your first question should be whether you also subscribe to the basic points. If you do, then we should immediately sit down and work out the details and clarify the language.

One point that our attorney Sam Fritschner brought up. The basic points that we are concerned about can be a matter of a contractual arrangement between our two bodies, binding on future commissions.

Some of the other points, such as planning issues, policy establishment, etc., would not be binding and should be handled in some other manner than part of a contract.

I would make this further comment. Any contract of this nature requires the enthusiastic support of the parties involved. With that support, as bumps appear in the road, we overcome them and move forward for the good of the entire community. Without that support, any agreement will always have problems and will probably not work in the long run. If we are able to come together on this issue, I feel that in the first two years we will make it work. Most of us will be here for at least that length of time, and if we set a good pattern of working together, it will be more difficult for future boards to screw it up.

We are ready!@

Commissioner Kumor distributed a AProposed Sewer Agreement Outline@. She and Mayor Niehoff called this agreement a Memorandum of Understanding and decided that it would expire in five years to give plenty of time to deal with the issues.

The initial goal of this agreement was to deal with some of the City=s immediate needs. The other part of the agreement is to address the long term issues that are of concern to Henderson County.

Renee reviewed the following:

The City:

connects to the Mud Creek gravity line to provide Flat Rock sewer service

takes over maintenance of Mud Creek lines

charges the Mud Creek customers the same fee structure as customers in the

Village of Flat Rock, this includes a surcharge for debt service

agrees to compensate County for lines that are later annexed similar to the

system in the >86 agreement

agrees to treat sewage of the Mud Creek Basin

will not extend sewer lines into unincorporated areas of Mud Creek Basin, unilaterally

The County:

rates for Mud Creek customers are the same as all other customers outside the City

is not required to pay up front costs for sewer plant

eliminates allocation system

develop a funding mechanism for Mud Creek that does not rely on surcharge

for maintenance and expansion

During these five years the City and County must:

establish same/similar sewer policies

develop a long range plan for Mud Creek that addresses possible annexations,

public health and safety, overall treatment capacity of the sewer plant

relative to growth

organize a body to monitor long range plan that will be composed of two City

members and two county members, the four selecting the Chair, a fifth

member

redraw Mud Creek and Cane Creek districts to realistically reflect drainage area

address realigning service relative to district lines, for example, Mtn. Home

discharge should go to Cane Creek

In five years, if these goals are not met:

The County has the option to take back operation and maintenance of the Mud

Creek system

The City will purchase a portion of the transmission line reflecting the per cent of

us by city customers within municipal boundaries

If in five years, goals have been met, the agreement will be renewed as a permanent method of operation.

During the intervening years, developing a long range plan should resolve issues such as capacity, annexation plans, funding responsibilities.

Chairman Hawkins asked that Commissioners Kumor and Moyer meet with representatives of the City Council to look at what kinds of things both Boards would be interested in in a Memorandum of Understanding. He mentioned four areas that were of particular interest to him:

C fee structure

C funding mechanisms

C functioning of the Board - working on expansions

C final status of the 1986 agreement

He gave this subcommittee an April deadline.

CANE CREEK WATER & SEWER DISTRICT

Fletcher Elementary School Project

David Nicholson and Gary Tweed updated the Board following the last Joint Facilities Meeting. Gary Tweed recommended a forced main for the new Fletcher School. This would allow sufficient line for other customers to tie into the line. Henderson County would take over the line as part of the Cane Creek system. It was recommended that they allow other customers to tie into it. Each property owner would have to have their own pump system and maintain it.

This was for the Board=s information. No action was requested at this time. Gary further suggested that we inform the School Board of what we intend to do.

MILLS RIVER SEWER PROJECT

Engineering Agreement

Gary Tweed reminded the Board that at the last workshop, staff was authorized to work with William G. Lapsley & Associates to get a contract put together for the Mills River project. Gary presented the proposal to the Board for William G. Lapsley & Associates to do the work on an hourly rate basis, not to exceed certain amounts for certain functions of the job. This was written up in a standard engineering contract. Gary felt that each item was well within accepted engineering costs.

Following discussion, Commissioner Kumor made the motion to accept the recommendation of Gary Tweed to approve the Engineering Agreement and authorize the Chairman to sign. All voted in favor and the motion carried.

Resolution - Clean Water Bonds

Gary Tweed explained that the deadline for the Clean Water Bond grant program is March 31. There are four resolutions that must be executed as part of the application process.

Angela Beeker addressed Minority Business Participation as a public bidding requirement.

Following discussion, Commissioner Moyer made the motion to approve the certificates and four resolutions and authorize the designated person to sign them. All voted in favor and the motion carried.

This item will be on the agenda next Wednesday for action by the Cane Creek Water & Sewer District Board.

WATER POLICIES

Angela Beeker distributed two hand-outs, some of the articles and the top ten list of issues of the water policies. These articles had been completed since the last review, Article 13, 14, and 15. Staff is still working on Article 12 - Customer Services.

TOP TEN ISSUES OF THE WATER POLICIES

1. Section 1.02 Purpose and Intent

Angela reminded the Board that Henderson County entered into a regional water agreement with Buncombe County, the City of Asheville, and the Asheville, Buncombe, Henderson Water Authority to allow them to build a plant in Henderson County and to provide water to Buncombe, Asheville, and Henderson County.

A formal policy must be adopted for legal reasons and because the agreement requires it.

2. Section 1.03 Organization and Interpretation

Angela had taken the Authority=s existing policies and the Regional Water Agreement and combined them. Pursuant to that Regional Water Agreement, our policies have to substantially conform to the Water Authority=s policies; however, there are some things in the agreement that conflict with those policies. If they conflict, the Regional Water Agreement has control.

3. Section 2.01 Definition of the Service District

Angela stated that the service district is the area in which the Authority is required by the Regional Water Agreement to install a water distribution system. This area will initially consist of the Cane Creek Water and Sewer District, as enlarged or extended, but may be amended, expanded or restated to incorporate all or a portion of Henderson County and/or the Mud Creek Water and Sewer District.

4. Section 3.11 Eligibility for Service

Angela pointed out the last two sentences of this section ANotwithstanding the foregoing, the County may provide a written demand to the Authority pursuant to Subsection 4.0 of the Regional Water Agreement and said Subsection 4.0 be enforced. Subsection 4.0 of the Regional Water Agreement is hereby incorporated by reference as if fully set forth herein.@

She discussed briefly water use restrictions, interruption in service, etc.

5. Article 4 Extensions

Angela explained that an extension is an extension of the system. ATo the extent that the extension is a Regional Water Line, or is connected to a Regional Water Line, the provision contained in Article 10 below shall also apply.@ If an extension is owned by the Authority, the Authority maintains it, if done by Henderson County, the County maintains it but we can contract with the Authority to do the maintenance for us.

6. Article 5 Connections

Angela explained that a connection is a simple connection from a customer to the system. If a connection is being made to a Regional Water Line, Article 10 will apply.

7. Article 9 Water Service Agreements

Angela explained that any customer in Henderson County who wishes to receive water must sign a water service agreement, a three party agreement between Henderson County, the Authority, and the user. If connections are being made to a Regional Water Line, this is crucial. The only way to guarantee that we would have the net revenue coming in for the Regional Water Line to pay for the Regional Water Line is if every customer that connects to the Regional Water Line has to sign an agreement guaranteeing that they will connect or that they will pay the minimum service fee if they don=t connect.

8. Article 10 Regional Water Lines

If the County requests, the Authority must, upon request, build a water transmission and distribution line in Henderson County if the net revenues to be generated off that line over a nine year period would pay the capital costs of the line. Under the Regional Water Agreement, the County, Utilities Director, or any person or any developer may request that a Regional Water Line be constructed.

9. Article 11 Fees

Angela stated that the Henderson County Board of County Commissioners will enact a schedule of fees.

10. Article 13 Appeals

Angela explained that anyone who wishes to appeal anything in accordance with the Authority policies makes the complaint to the Water Director, the Water Director gives a response and then they can appeal to the Policies and Priorities Committee for a full hearing if they don=t feel that the Director=s response is adequate and then appeals from the Policies and Priorities Committee go to the Authority.

For Henderson County citizens, the chain would be different. The initial complaint would still go to the Water Authority directly. Any appeals from that would go to the Policies and Priorities Committee. Any appeal to the Policies and Priorities Committee would come to the Henderson County Board of Commissioners.

No action was requested at this time. The Water Policies were just introduced at this point. Angela explained that these Water Policies have been sent to the Water Authority for comment.

Chairman Hawkins suggested that these Water Policies be placed on the mid April Board Meeting (April 19, 2000) and hopes to get comments back from the Water Authority before that time.

There being no further business to come before the Board, the meeting was adjourned.

ATTEST:

Elizabeth W. Corn, Clerk to the Board Grady Hawkins, Chairman