No bailout for Lake Junaluska
Lake Junaluska community leaders gave residents a first look at how its service fees will increase since its merger with Waynesville was thwarted, at least temporarily.
The Lake Junaluska Community Council recommended increasing its garbage pickup fee and homeowner service fee but postponed any decision on water and sewer costs during a series of unanimous votes at its meeting last week. More than 50 people were in attendance.
A fee increase was both anticipated and expected if the merger with Waynesville did not go through. Paying town taxes would be cheaper than a go-it alone approach, where Lake Junaluska residents shoulder the burden of community services and infrastructure repairs among a much smaller population.
The town’s critical mass gives it economies of scale, allowing it to provide services to the masses more cheaply than Lake Junaluska can muster as a stand-alone entity of just 765 homes.
Some opponents to a merger, however, have questioned whether the threat of increased homeowner fees and water and sewer maintenance surcharges is a ploy to galvanize support for annexation. Critics of a merger are distrustful, wondering whether the numbers are being manipulated to convince homeowners to support annexation.
“I think there are people that have concluded that. I would like to think that is not true, but there are people who think that. I hope it is not true,” said Walt Logan, a seasonal homeowner at Lake Junaluska from Florida who is against merging with Waynesville.
Merging with Waynesville was supported by a 60 percent majority in a survey of property owners and was supported by both the homeowners association and community council. But opponents lobbied against it Raleigh and derailed its passage.
There are plans to push for it again next year, however. In the meantime, a fee hike is poised to come to fruition.
The final decision on any fee increases rests with the Lake Junaluska Assembly Board of Directors, a 32-member body that oversees the Lake Junaluska Conference and Retreat Center’s operations. However, the recommendations of the Community Council, a seven-person board elected by Lake Junaluska homeowners to represent residential issues, would likely be heeded by the Assembly.
• The council agreed to increase the trash pickup fee by $3 to $16.86 a month starting Jan. 1 due to increased hauling fees to the landfill. The increase will bring in an additional $21,750 a year.
• The service charge, akin to a homeowner’s fee common in most subdivision communities, pays for street maintenance, upkeep of commons areas and security. It will go up from 33 cents to 35.25 cents per $100 of home value starting Nov. 1.
Ironically, about $5,000 in the homeowner’s service fees will fund continued efforts on Lake Junaluska’s part to get the merger passed. The money will primarily cover traveling expense to and from Raleigh for Public Works Director Buddy Young to lobby in favor of the merger bill.
The Lake and Waynesville shared costs for a lobbyist this year, services rendered by Haywood County’s own Chip Killian, an attorney and lobbyist. However, Young plans to do the legwork himself next year to save costs.
If this bill gets passed next year, it will likely require an official referendum vote of Lake Junaluska residents as a condition.
“It is unrealistic that a bill will be passed that doesn’t include a referendum,” Young said.
Only those registered to vote at a Lake Junaluska address could participate in the referendum vote, however, and more than half of Lake residents claim full-time residence elsewhere.
Only one audience member addressed the issue of the merger to ask if other options, such as incorporation, were being considered since the bill is stopped for now.
“Annexation is the option I am working toward at this time,” Young said.
Murmurs from the rest of the crowd indicated the room’s general support for the merger.
The homeowner’s fee increase will bring in $50,000 in new money. It is primarily needed to fund a transition plan for top positions within Junaluska’s residential services division due to retirements coming down the pike. The public works director and security chief are both retiring next year, and whoever is hired may require a bigger salary than what the old guys were getting.
“I can’t imagine they are going to get anyone for close to what they are paying me,” Young said, citing that the security chief is also underpaid given his position.
Plus, there will be overlap time when the new public works director is already on the payroll and Young stays on as a consultant to train the new hire.
Water and sewer: where the rub lies
While the other fees were easy enough to agree upon, the sewer and water base rates were trickier. Parts of Lake Junaluska’s water and sewer system are a century old and continue to deteriorate.
The lake has limped along in its upkeep of the water and sewer lines. But the time of reckoning is upon them.
“We are just patching and plugging the best we can. Sooner or later they get to the point where you can’t patch them anymore. It is patch upon patch. It is the worst way to run a water and sewer system,” Young said.
In March, the Lake lost 54 percent of the water it purchased because of old pipes.
Young presented three options to the community council for how much to hike water and sewer maintenance fees.
They were based on studies and assessments of the water and sewer system conducted by two different engineering consulting firms.
One option covering only critical needs called for a $3 increase a month. The other option called for an increase of $20 a month.
A third option, calling for an even larger increase of $48 a month, was dismissed as just too much.
Lake Junaluska has an estimated $5.6 million water and sewer infrastructure repairs. The current water and sewer maintenance surcharge is $16 a month.
Had the lake merged with Waynesville, the infrastructure liability would be assumed by the town. The town could have taken care if it for less, able to borrow money and make repairs upfront but pay it off over time. But Lake Junaluska Public Works can’t borrow money and has to pay as it goes for repairs, levying the needed amount for repairs year to year.
Young said the $3 a month increase would just be “hanging in there another year or two and hoping we get the merger with Waynesville.”
The $20 a month increase takes the approach of “OK, we are in it by ourselves, and let’s get to it,” Young said.
The Lake Junaluska Conference and Retreat Center is biggest consumer of water and generator of waste because of its size. While a monthly increase maybe difficult for individual residents, the conference and retreat center will undoubtedly be most affected.
“They will be substantial, but we knew that,” said Jack Ewing, the CEO of Lake Junaluska Conference and Retreat Center.
Community Council member Ken Zulla indicated his support for increasing the water and sewer rates at the $20 a month level, “knowing that is probably not the right fix,” but that a higher level of repairs will just have to wait, he said.
In the end, the council decided to hold off on a vote until the next meeting so they could see how the two options would affect the budget of the Conference and Retreat Center operations, which has been financially challenged in recent years.
“We will have the entire picture before us next meeting,” Community Council Chair Bill King said.
Reporter Becky Johnson contributed to this story.