The Henderson City Council unanimously approved a 40-year agreement with Vance County relating to the sale of water to the Vance County Water District and the funding of certain jointly funded projects with the county.
City Attorney John Zollicoffer outlined the important features of the agreement for the council before the vote was taken.
According to the attorney, the contracts for the sale of water and the joint funding agreements are intertwined. One will not take effect without the other.
The water contract is for Phase 1a only of the county’s water project. It applies to the first 150,000 gallons per day of water sold to the county.
The county is obligated to install fire hydrants every 2,000 feet along its water lines with stub-outs between each hydrant at 1,000 feet should Henderson wish to install hydrants in the future. Henderson must approve pressure stations and as well as other aspects of the county’s system, and meters must have backflow valves to protect Henderson’s system.
Water that passes through meters is deemed as purchased by Vance County.
The county requested that the city reserve 150,000 gallons per day for the county’s use. The water storage fee is over $9,000 for the service, but the city agreed to waive the fee for the next two years.
Water will be sold at the rate of $2.90 per 1,000 gallons. Later in the meeting, Zollicoffer commented that the city is selling the water at a reduced rate in consideration of “things that were given to us in joint funding”.
The city and county agree not to sell water to each other’s potential customers unless Henderson sells to an area it proposes to annex. There will be no cross connections between the county system or any private source, and water shortages will be shared equally among all customers. The county may not resell water.
If the county fails to pay for the water, Henderson has the right but not the obligation to take over the county system and sell water itself.
The contract extends for 40 years, and the city has the right to terminate under certain conditions. The contract may only be amended with the consent of the city, Vance County, and the Vance County Water District, and it must be approved by the USDA.
According to Zollicoffer, the 40 year contract is required as a condition of the USDA grants with which the county is building its system.
As for the new joint funding arrangement, the funding of the library will shift from 65% county 35% city 75% county and 25% city over the next two fiscal years in 5% increments. The city will reduce its number of appointees to the Library Board from six to three over that time.
The Economic Development Commission is currently funding 75% county 25% city. The county will take over funding for all normal operations of the commission; however, special projects will be funded by both entities on a case-by-case basis. Appointments to the EDC will continue at the same ratio as before.
Regarding the Board of Elections, Henderson will pay 17% of operating expenses and 100% of the direct cost of municipal elections. Zollicoffer said that the latter is required by North Carolina general statute.
The county will defer the city’s debt service on the Henderson Municipal Building for 2010 and 2011. The city will repay the obligation in July of 2012, 2013, 2014, 2015, and 2016.
This agreement may not be terminated except by consent of both parties for the next 40 years as well.
The council was told that the Vance County Board of Commissioners was considering the agreement during their meeting yesterday as well. The outcome of their vote, if any, was not known at time of publication.