TWSA votes down expanded allocation rental
A proposal to extend the allocation rental option to all Tuckaseigee Water and Sewer Authority users hit a dead end March 20 when board members voted 5-1 against a proposal to loosen the policy.
But that doesn’t mean that appetite for change is nonexistent. Two board members — Mike Byers, a nonvoting member who is Western Carolina University’s vice chancellor for administration and finance, and Ron Mau, a Jackson County commissioner — expressed support for the suggestion from fellow board member David Nestler, a Sylva town commissioner. They just felt that the timing was off.
“I’m sympathetic to what you’re saying, David, but if you start thinking about the timeline of getting everything done — even if we said, ‘Let’s fix it now,’ I’m thinking it would probably take the same timeline as 436,” Mau said.
That’s House Bill 436, a law the state legislature passed last year requiring any water or sewer utility charging up-front fees like the impact fees TWSA currently levies to go through a prescribed method to calculate the maximum amount they can legally charge. After June 30, this fee will be known as a system development fee, and in the coming months TWSA members will have to wrangle with how high those fees should be.
An initial presentation of the report calculating those legal maximums showed that TWSA could actually set its upfront fees well above the current levels, but in recent years those current levels have met criticism for being too high already. Last month, Sylva restaurant owner George Neslen came before the board to say that the nearly $50,000 in fees required to move his business to a new location would prevent him from expanding in Sylva. TWSA later allowed Neslen to take advantage of the rental option, developed in 2015, due to the fact that the property he plans to use has existing — though much smaller than needed — water and sewer taps. That decision allowed Neslen to move forward with this plans, but the incident has left some seeing the need for a more widespread solution.
“We had two members of the community come in two weeks in a row with pretty huge issues with the impact fee and exposed a lot of the problems with this system,” said Nestler. “We have the framework in place to alleviate those problems, if not solve them.”
The rental option, which allows users to pay a monthly fee in perpetuity rather than cutting a large one-time check, is currently available only to customers with existing connections who wish to increase their allocation. Nestler would like to see it expanded to all users, including new construction, though he said he’d see the sense in requiring a baseline upfront impact fee, with rental payments taking care of allocation above that baseline amount.
While Nestler is strong in his opinion on the issue, others on the board don’t feel the same way. When the proposal came through the Policy Committee — that includes Nestler, Webster Mayor Tracy Rodes and Tom Sawyer, a businessman who was appointed by the county commissioners — Nestler was the only one who voted to recommend it for adoption.
According to TWSA Executive Director Dan Harbaugh, the rental policy was developed for a specific audience — existing users looking to upgrade their allocation — and opening it to all customers would have negative ramifications.
“Taking this away from the target audience and applying it to all of our customers will have an impact on revenue,” said Harbaugh. “The underlying issue is how TWSA collects the needed revenue from customers.”
Harbaugh added that the other two Policy Committee members felt the timing wasn’t right to consider such a change.
“H.B. 436 is already forcing us to look if we’ll be able to charge rental fees in the future, because they’re based on impact fees,” said Harbaugh.
Other TWSA members concurred with Rodes’ and Sawyer’s concerns about timing.
“Our staff is already taxed with what they’re doing with the House bill, and to come in and do what might be a temporary fix for a change and then in two months or three months have to change it again — I think it’s creating work,” said Brenda Oliver, a former Sylva mayor appointed by the Town of Sylva.
“When we switch to some kind of monthly charge as opposed to an upfront charge, it’s going to change in those first few years what the cash flow is for the organization, so it could have short-run impacts on making ends meet, and we would need to study that,” Byers concurred. “To think we’re going to do all that in a hurry in April just so we can get it done before this House bill mess is done in June seems like a heavy lift.”
Public hearing planned
The Tuckaseigee Water and Sewer Authority plans to hold a public hearing at 5:30 p.m. Tuesday, April 17, to take input on the supporting analysis driving recommendations for the legal maximum it will be able to charge new users to tap on to the system.
A draft of the analysis was presented during the Feb. 13 meeting. It is available online under the “Forms and Documents” tab at www.twsanc.us under the link for “TWSA System Development Fee Study.” The direct link is bit.ly/2pGFM1W.