Asheville Brief filed before the North Carolina Supreme Court
RELATED
References to Revenue Bonds in Original Complaint
Original Asheville Complaint
Showing posts with label water system. Show all posts
Showing posts with label water system. Show all posts
Thursday, March 03, 2016
Saturday, December 19, 2015
Confusion at City Hall
Don't these people talk to each other?
ON THE DIFFICULTY OF A WATER SYSTEM TRANSFER
Jade Dundas, Water Resources Director, City of Asheville:"Issues that would need to be resolved include:
-Transferring the contracts of the department’s 148 employees.
-Nontransferrable federal and state health-and-safety certifications.
-Transferring the financial, accounting and information technology systems.
-Training new employees.
-The city’s water-related bond debt, which is financed by system revenues."
http://mountainx.com/news/under-pressure-amid-legal-maneuvering-dundas-sets-water-departments-course/
ON THE DIFFICULTY OF A BREWERY TRANSFER
Esther Manheimer, Mayor, City of Asheville: “To me a corporate transfer doesn’t necessarily mean anything about the experience our city will have with this company. It may just mean a change in ownership. It may not mean a change in the employees or the number of employees they plan to hire or their agreements. It may have no implications in terms of their agreements with the city.”
http://www.citizen-times.com/story/news/2015/12/18/reports-new-belgium-explores-sale-asheville/77569628/
RELATED
Blogpost: Asheville's Continued Misinformation Campaign
ON THE DIFFICULTY OF A WATER SYSTEM TRANSFER
Jade Dundas, Water Resources Director, City of Asheville:"Issues that would need to be resolved include:
-Transferring the contracts of the department’s 148 employees.
-Nontransferrable federal and state health-and-safety certifications.
-Transferring the financial, accounting and information technology systems.
-Training new employees.
-The city’s water-related bond debt, which is financed by system revenues."
http://mountainx.com/news/under-pressure-amid-legal-maneuvering-dundas-sets-water-departments-course/
ON THE DIFFICULTY OF A BREWERY TRANSFER
Esther Manheimer, Mayor, City of Asheville: “To me a corporate transfer doesn’t necessarily mean anything about the experience our city will have with this company. It may just mean a change in ownership. It may not mean a change in the employees or the number of employees they plan to hire or their agreements. It may have no implications in terms of their agreements with the city.”
http://www.citizen-times.com/story/news/2015/12/18/reports-new-belgium-explores-sale-asheville/77569628/
RELATED
Blogpost: Asheville's Continued Misinformation Campaign
Wednesday, December 16, 2015
Who Owns WNC's Water
Carolina Public Press
October 22, 2015
Town Hall, Fletcher, NC
At its Newsmakers forum held on Oct. 22, 2015, Carolina Public Press held a panel discussion on the ownership and management of public and private drinking water systems in Western North Carolina. Panelists were Kim Colson, director, N.C. Division of Water Infrastructure; Katie Hicks, assistant director, Clean Water for North Carolina; Rep. Chuck McGrady, R-Henderson; and Lee Smith, utilities director, Hendersonville Water and Sewer. The event was moderated by Carolina Public Press’s Investigations and Open Government Editor Jon Elliston and its lead environmental contributing reporter, Jack Igelman.
Subtopic: The Asheville Water System
Speaker: Chuck McGrady
Full Video: https://www.youtube.com/watch?v=AobC85Aa64U
October 22, 2015
Town Hall, Fletcher, NC
At its Newsmakers forum held on Oct. 22, 2015, Carolina Public Press held a panel discussion on the ownership and management of public and private drinking water systems in Western North Carolina. Panelists were Kim Colson, director, N.C. Division of Water Infrastructure; Katie Hicks, assistant director, Clean Water for North Carolina; Rep. Chuck McGrady, R-Henderson; and Lee Smith, utilities director, Hendersonville Water and Sewer. The event was moderated by Carolina Public Press’s Investigations and Open Government Editor Jon Elliston and its lead environmental contributing reporter, Jack Igelman.
Subtopic: The Asheville Water System
Speaker: Chuck McGrady
Full Video: https://www.youtube.com/watch?v=AobC85Aa64U
Wednesday, December 09, 2015
Asheville's Continued Misinformation Campaign
The Mountain Xpress weekly newspaper has finally broken the extended news black-out of the failing Asheville water lawsuit. But there is a lot of misinformation and a lot is missing, like quotes from MSD.
The article entitled "Under Pressure" states that the water system has an uncertain future. The future of the water system is far from uncertain. No matter what happens in court, the city is certain to lose the water system. (http://timpeck.blogspot.com/2015/11/city-councils-malfeasance.html)
The article cites Water Department head Jade Dundas saying that the transfer would take "at least a year."That is not true. The transfer would take approximately 24 hours, give or take a few minutes. The inevitability of the system transfer has made it incumbent on MSD to plan for the transfer and those plans are in place and will be activated immediately upon the Supreme Court's dismissal of the City's appeal.
State's Motion to Dismiss & Response to PDR: https://www.scribd.com/doc/292783971/State-s-Motion-to-Dismiss-Response-to-PDR
Jade continues misinforming the public saying that the issues that need to be resolved include:
-- "Transferring the contracts of the department's 148 employees."
There are no contracts to transfer. Water department staff are not contractors, they are employees. The only difference will be a different logo on their paychecks, and a different signature.
-- "Non-tranferrable federal and state health-and-safety certifications."
Certifications are for people and they are not void in the event of a transfer of the employee.
-- "Transferring the financial, accounting and information technology systems."
MSD is ready to take over these systems as is on day one, to be operated in parallel with the current sewerage operational systems. Data migration will take place over time and under MSD's purview.
-- "Training new employees."
What new employees? Water department employees will do the same job in the same capacity, only under new management. If anything, there will be staff reductions due to consolidation.
-- "The City's water-related bond debt, which is financed by system revenues."
Here we have an admission that Asheville does not own the water system. If it did, the bonds would have been financed by the taxpayers, not water customers. Instead, the are Revenue Bonds. Also note that there is no explanation why this would be an issue. Perhaps that is because it is NOT an issue. The state has an office dedicated to resolving bond transfer issues and this has already been addressed well in advance of the coming transfer. In fact, the bonds themselves anticipate this eventuality and provides for a smooth transference to another political subdivision of the state.
The trial court raised the matter of the issuance of revenue bonds and states that the bonds are “secured by the net revenues of the Water System” and that there is “no provision made anywhere in the Act for obtaining the consent of the bondholder” for any transfer to an “unrated successor.”
The new Metropolitan Water and Sewerage District (MWSD), created by the Act, extends the existing Metropolitan Sewerage District (MSD) by merging the Metropolitan Water District with the currently operating MSD. MSD has as sturdy a bond rating as the City, and the rating would not suffer a loss of strength as a consequence of the Act. Note that MSD possesses the authority to operate a water utility, granted to it by the state in Session Law 2012-103. (See Article 5 - Metropolitan Sewerage Districts. § 162A-69. (13c) “To exercise any power of a Metropolitan Water District under Article 4 of this Chapter not set forth in this section.”)
Debt service on the Revenue Bonds is guaranteed with the continued operation of the water system, which the Water Act ensures. Debt service is further guaranteed by the State in the event of default by the obligor (See State's Motion to Dismiss).
There is no provision in the Act for transfer of debt precisely due to the existence of a longstanding process for handling the inter-governmental transfer of debt obligations as established by the state Department of Treasury’s Division of State and Local Government.
Furthermore, the City's lackluster defense of its claims of the risk to bondholders demonstrates a lack of genuine concern.
The NC Appeals Court, Page 25-26, states in its ruling: "We do not reach any conclusion regarding Asheville’s fourth and fifth claims for relief, in which Asheville contends that the enforcement of the Transfer Provision would impermissibly impair obligations of contract in violation of our state and federal constitutions and in violation of N.C. Gen. Stat. § 159-93. The trial court made no rulings on these claims, and Asheville did not take advantage of Rule 10(c) of our Rules of Appellate Procedure, which allows an appellee to propose issues which form 'an alternate basis in law for supporting the order[.]' Therefore, any argument by Asheville based on these claims for relief are waived."
In other words, the City neglected to raise the issue in Appeals and thus forfeited its right to appeal the ruling on that point. As stated in the State's whip-smart Motion to Dismiss, Page 15, note 3:
Indeed, so great is the City's error, the court's can no longer respond to its late-coming complaint. Citing a controlling precedent going back to 1968, the State's Motion to Dismiss (Page 21) courteously reminds the Supreme Court that it may not consider any matter extraneous to the Appeals Court ruling; to wit, the bond issue.
The article entitled "Under Pressure" states that the water system has an uncertain future. The future of the water system is far from uncertain. No matter what happens in court, the city is certain to lose the water system. (http://timpeck.blogspot.com/2015/11/city-councils-malfeasance.html)
The article cites Water Department head Jade Dundas saying that the transfer would take "at least a year."That is not true. The transfer would take approximately 24 hours, give or take a few minutes. The inevitability of the system transfer has made it incumbent on MSD to plan for the transfer and those plans are in place and will be activated immediately upon the Supreme Court's dismissal of the City's appeal.
State's Motion to Dismiss & Response to PDR: https://www.scribd.com/doc/292783971/State-s-Motion-to-Dismiss-Response-to-PDR
Jade continues misinforming the public saying that the issues that need to be resolved include:
-- "Transferring the contracts of the department's 148 employees."
There are no contracts to transfer. Water department staff are not contractors, they are employees. The only difference will be a different logo on their paychecks, and a different signature.
-- "Non-tranferrable federal and state health-and-safety certifications."
Certifications are for people and they are not void in the event of a transfer of the employee.
-- "Transferring the financial, accounting and information technology systems."
MSD is ready to take over these systems as is on day one, to be operated in parallel with the current sewerage operational systems. Data migration will take place over time and under MSD's purview.
-- "Training new employees."
What new employees? Water department employees will do the same job in the same capacity, only under new management. If anything, there will be staff reductions due to consolidation.
-- "The City's water-related bond debt, which is financed by system revenues."
Here we have an admission that Asheville does not own the water system. If it did, the bonds would have been financed by the taxpayers, not water customers. Instead, the are Revenue Bonds. Also note that there is no explanation why this would be an issue. Perhaps that is because it is NOT an issue. The state has an office dedicated to resolving bond transfer issues and this has already been addressed well in advance of the coming transfer. In fact, the bonds themselves anticipate this eventuality and provides for a smooth transference to another political subdivision of the state.
The trial court raised the matter of the issuance of revenue bonds and states that the bonds are “secured by the net revenues of the Water System” and that there is “no provision made anywhere in the Act for obtaining the consent of the bondholder” for any transfer to an “unrated successor.”
The new Metropolitan Water and Sewerage District (MWSD), created by the Act, extends the existing Metropolitan Sewerage District (MSD) by merging the Metropolitan Water District with the currently operating MSD. MSD has as sturdy a bond rating as the City, and the rating would not suffer a loss of strength as a consequence of the Act. Note that MSD possesses the authority to operate a water utility, granted to it by the state in Session Law 2012-103. (See Article 5 - Metropolitan Sewerage Districts. § 162A-69. (13c) “To exercise any power of a Metropolitan Water District under Article 4 of this Chapter not set forth in this section.”)
Debt service on the Revenue Bonds is guaranteed with the continued operation of the water system, which the Water Act ensures. Debt service is further guaranteed by the State in the event of default by the obligor (See State's Motion to Dismiss).
There is no provision in the Act for transfer of debt precisely due to the existence of a longstanding process for handling the inter-governmental transfer of debt obligations as established by the state Department of Treasury’s Division of State and Local Government.
Furthermore, the City's lackluster defense of its claims of the risk to bondholders demonstrates a lack of genuine concern.
The NC Appeals Court, Page 25-26, states in its ruling: "We do not reach any conclusion regarding Asheville’s fourth and fifth claims for relief, in which Asheville contends that the enforcement of the Transfer Provision would impermissibly impair obligations of contract in violation of our state and federal constitutions and in violation of N.C. Gen. Stat. § 159-93. The trial court made no rulings on these claims, and Asheville did not take advantage of Rule 10(c) of our Rules of Appellate Procedure, which allows an appellee to propose issues which form 'an alternate basis in law for supporting the order[.]' Therefore, any argument by Asheville based on these claims for relief are waived."
In other words, the City neglected to raise the issue in Appeals and thus forfeited its right to appeal the ruling on that point. As stated in the State's whip-smart Motion to Dismiss, Page 15, note 3:
Indeed, so great is the City's error, the court's can no longer respond to its late-coming complaint. Citing a controlling precedent going back to 1968, the State's Motion to Dismiss (Page 21) courteously reminds the Supreme Court that it may not consider any matter extraneous to the Appeals Court ruling; to wit, the bond issue.
Thursday, November 12, 2015
Denial of Petition for Rehearing
Appeals Court Denial of Petition for Rehearing
City of Asheville v. State
City of Asheville v. State
Wednesday, November 11, 2015
Barry on the Jeff Messer Show
Jeff Messer Show on 880FM
October 6, 2015
Barry Summers
Podcast
Upon hearing that the NC Court of Appeals ruled against Asheville:
...
MESSER: There are a lot of words I can think of that I want to say to Raleigh right now and most of them the FCC object to.
SUMMERS: Today’s my birthday, too, Jeff. Happy birthday to me.
MESSER: They wanted to make sure you remembered this very specifically, I think, because you’ve been a thorn in their sides.
SUMMERS: [whispers] [laughs]
MESSER: You can say that word, that’s fine.
...
SUMMERS: The City is...according to Mayor Manheimer...and she called me at home and told me this specifically so I wouldn’t start...I think...presumably, so we wouldn’t start jumping up and down saying, “You have to appeal. You have to appeal” She immediately said...I mean, she was pissed. I mean, she was definitely pissed...“We’re definitely going to appeal this and apply for a stay of the ruling.” So, this will go on for another couple of years, in all likelihood, unless there is more legislative shenanigans to shorten the appeals time or move it to the front of the line. That’s the sort of the thing they tried to do in the last session...Well, we’re also...I think...I know that people really misjudged how badly certain parties want this.
...
MESSER: Well, if the courts are stacked at the higher end of the court system in the state, maybe [prevailing] is not such a no-brainer.
SUMMERS: In the 2012 elections the Republicans took over the State Supreme Court. I was at the event where Esther Manheimer, who was then just a council member, was shaking her head saying, “Oh, this is very bad news.” [laugh].
MESSER: They can get power. They can pass illegal laws that they then can be sued over, which takes a number of years. So they get away with these illegal laws for x-number of years, and during those years, while the case is being built, if they win the next election, they can change the courts, they can shift this, they can put somebody on the court of appeals who, by the time you get there, it takes longer to get the court case through then it takes to get through an election cycle, in some instances, and, boom, they own it. And, yeah, Esther was right to sit there and go, "Oh, this is bad."
SUMMERS: Right.
MESSER: Maybe that should be a talking point early in the election process as to why people should get off their asses and go out and vote, because this is where it leads.
SUMMERS: And I will also point out to the people who are currently going and voting for the primary for city council candidates, this is now got to be front and center, and my recommendation is to vote for candidates who have made it very clear what their attitude toward the state is on issues like control of Asheville’s water.
...
MESSER: Is this fight...has it just gotten harder because of this, do you think? I mean, the water fight. Now we have the Supreme Court...is that...in your view, it that a good thing or a bad thing, that we now have to take it to the State Supreme Court?
SUMMERS: Yeah, well, it’s definitely a bad thing. [laughs] We were all hoping and expecting that the Court of Appeals would support it.
MESSER: The Supreme Court in this state is much more stacked. Overtly.
SUMMERS: Yeah, as we said earlier. I don’t know if I’d call it stacked. It’s just that Republican judges are in control.
MESSER: They’re part of the agenda-driven system...A lot of pressure going to come to bear, though, I would imagine, as it heads in that direction. Is there anything beyond that?
SUMMERS: I’ve heard talk of a federal lawsuit. In fact, read the decision...the Court of Appeals actually refers to...sort of swats down the notion of 14th Amendment protections for the City. So, they’re actually, sort of, anticipating that the City might file a federal lawsuit. But I don’t have any information as to whether they’re considering that.
RELATED
Appeals court declines to reconsider city water ruling
Mark Barrett | Asheville Citizen-Times | November 11, 2015
October 6, 2015
Barry Summers
Podcast
Upon hearing that the NC Court of Appeals ruled against Asheville:
...
MESSER: There are a lot of words I can think of that I want to say to Raleigh right now and most of them the FCC object to.
SUMMERS: Today’s my birthday, too, Jeff. Happy birthday to me.
MESSER: They wanted to make sure you remembered this very specifically, I think, because you’ve been a thorn in their sides.
SUMMERS: [whispers] [laughs]
MESSER: You can say that word, that’s fine.
...
SUMMERS: The City is...according to Mayor Manheimer...and she called me at home and told me this specifically so I wouldn’t start...I think...presumably, so we wouldn’t start jumping up and down saying, “You have to appeal. You have to appeal” She immediately said...I mean, she was pissed. I mean, she was definitely pissed...“We’re definitely going to appeal this and apply for a stay of the ruling.” So, this will go on for another couple of years, in all likelihood, unless there is more legislative shenanigans to shorten the appeals time or move it to the front of the line. That’s the sort of the thing they tried to do in the last session...Well, we’re also...I think...I know that people really misjudged how badly certain parties want this.
...
MESSER: Well, if the courts are stacked at the higher end of the court system in the state, maybe [prevailing] is not such a no-brainer.
SUMMERS: In the 2012 elections the Republicans took over the State Supreme Court. I was at the event where Esther Manheimer, who was then just a council member, was shaking her head saying, “Oh, this is very bad news.” [laugh].
MESSER: They can get power. They can pass illegal laws that they then can be sued over, which takes a number of years. So they get away with these illegal laws for x-number of years, and during those years, while the case is being built, if they win the next election, they can change the courts, they can shift this, they can put somebody on the court of appeals who, by the time you get there, it takes longer to get the court case through then it takes to get through an election cycle, in some instances, and, boom, they own it. And, yeah, Esther was right to sit there and go, "Oh, this is bad."
SUMMERS: Right.
MESSER: Maybe that should be a talking point early in the election process as to why people should get off their asses and go out and vote, because this is where it leads.
SUMMERS: And I will also point out to the people who are currently going and voting for the primary for city council candidates, this is now got to be front and center, and my recommendation is to vote for candidates who have made it very clear what their attitude toward the state is on issues like control of Asheville’s water.
...
MESSER: Is this fight...has it just gotten harder because of this, do you think? I mean, the water fight. Now we have the Supreme Court...is that...in your view, it that a good thing or a bad thing, that we now have to take it to the State Supreme Court?
SUMMERS: Yeah, well, it’s definitely a bad thing. [laughs] We were all hoping and expecting that the Court of Appeals would support it.
MESSER: The Supreme Court in this state is much more stacked. Overtly.
SUMMERS: Yeah, as we said earlier. I don’t know if I’d call it stacked. It’s just that Republican judges are in control.
MESSER: They’re part of the agenda-driven system...A lot of pressure going to come to bear, though, I would imagine, as it heads in that direction. Is there anything beyond that?
SUMMERS: I’ve heard talk of a federal lawsuit. In fact, read the decision...the Court of Appeals actually refers to...sort of swats down the notion of 14th Amendment protections for the City. So, they’re actually, sort of, anticipating that the City might file a federal lawsuit. But I don’t have any information as to whether they’re considering that.
RELATED
Appeals court declines to reconsider city water ruling
Mark Barrett | Asheville Citizen-Times | November 11, 2015
Friday, October 30, 2015
Transfer of Waterlines
Buncombe County transfers their waterlines to the City of Asheville under duress
Buncombe County Board of Commissioners
David Gantt, Chairman
K. Ray Bailey, Commissioner
Bill Stanley, Commissioner
Carol Peterson, Commissioner
Holly Jones, Commissioner
Regular Meeting
May 15, 2012
Consent Agenda: inclusive of
Resolution 12-05-06. Resolution Granting the Chairman Authority to Deed Any Remaining Interests in the Properties Known as Municipal Gold Course, Recreation Park/WNC Nature Center, McCormick Field, South Pumping Station and All County Owned Water Assets to the City of Asheville
Carol Peterson moved to approve the Consent Agenda. Holly Jones seconded the motion. Motion passed 5-0.
Source: Buncombe County Clerk to the Board Archives
Buncombe County Board of Commissioners
David Gantt, Chairman
K. Ray Bailey, Commissioner
Bill Stanley, Commissioner
Carol Peterson, Commissioner
Holly Jones, Commissioner
Regular Meeting
May 15, 2012
Consent Agenda: inclusive of
Resolution 12-05-06. Resolution Granting the Chairman Authority to Deed Any Remaining Interests in the Properties Known as Municipal Gold Course, Recreation Park/WNC Nature Center, McCormick Field, South Pumping Station and All County Owned Water Assets to the City of Asheville
Carol Peterson moved to approve the Consent Agenda. Holly Jones seconded the motion. Motion passed 5-0.
Source: Buncombe County Clerk to the Board Archives
Tuesday, October 27, 2015
Kaliner Interviews Joe Dunn
Pete Kaliner interviews former city council member Dr. Joe Dunn about the water system.
October 26, 2015
October 26, 2015
RELATED
Water Lawsuit Press Conference
http://timpeck.blogspot.com/2013/05/asheville-water-system-lawsuit-press.html
Monday, October 26, 2015
Kaliner Interviews Janet Cowell
Pete Kaliner interviews NC Treasury Secretary Janet Cowell
Audio: https://soundcloud.com/tim-peck-994374558/janet-cowell-on-water-system-bonds
Transcript
KALINER: Your office has had a little bit of a role in our local debate over the water system. I guess you did a report or you gave an opinion to the effect of how a transfer, how this merger would or could impact the city's finances.
COWELL: So, yeah, to clarify, the Treasurer's Office...we are also very unique nationally in that out of the Depression came a system of oversight of local government. We had one hundred and sixty defaults during the Depression. Not good.
KALINER: Not all from here, though. Most of them, probably.
COWELL: Well, all over the state.
KALINER: There were...but...yeah, but there were a bunch from Asheville.
COWELL: All over the state.
KALINER: Yeah.
COWELL: And so we put in an oversight system, called the Local Government Commission run through the Treasurer's Office and we look at the finances for every single unit of government. We help them issue debt and just make sure that everything stand between the guard rails. In the situation with Asheville, we are sort of the technical adviser to the situation and all of this gets complicated because, actually, the bill is drafted strangely, so it was not clear: does this need to go through the Local Government Commission? But we're trying...my goal is to make sure that everything is smooth-functioning, that there's no disruption to the bond market in North Carolina, you know, that the operations continue and try to work with everyone to make sure that that is what happens.
KALINER: So, well, because Asheville city leadership has been saying that your office gave this report that basically supports their position that this could disrupt their credit rating.
COWELL: I think the piece that we spoke to is that there was some conception that: oh, this won't impact the...the, um, you know, the budget of the city and in fact, you know, there are city administrative services, like technology or the city manager, and you allocate portions of that, so there's a two million hit to their budget with this transfer and so we wrote a note explaining that, and showing... saying why that's legitimate, that's not a problem. But you just need to understand...
KALINER: That doesn't undermine their triple-A. That would not...a two million dollar hit.
COWELL: No, not in and of itself. And their documents have been much more clearly written. We have weighed in more on the Charlotte Airport because it is a...their documents on that bond transfer did not foresee a transfer. Asheville's did foresee a transfer. There are still complications, um, but in Charlotte it's also eight million dollars of outstanding bonds. That is a very big issuance and it is very unclear how that would all roll out.
KALINER: And I'm just...and you've also got...you've got the Feds involved on that side of it because you've got FAA stuff, I'm sure.
COWELL: Exactly. So...once...anything with airports, I think it's even more complicated than local. But we are also running a bill trying to clarify for water/sewer...you know, Asheville is a great system. You guys are solid, you're a very well-run unit. But that is the biggest problem with local government. I said it is not the Randy Parton Theaters or these, you know, crazy kind of entertainment complexes. Water/sewer is a huge problem. We're just trying to make a predictable path so that everybody can have a good system. If there is a change, or you do go regional, that there are clear guidelines and there are no surprises.
KALINER: Because the MSD, the Metropolitan Sewerage District that runs the sewer side of things, the regionalized, sort of, sewer system, they...they've got good bond...they've got a good bond rating as well.
COWELL: Yeah.
KALINER: So...and if these are Revenue Bonds versus G.O. Bonds, I would assume that the ownership follows...or the, you know, because it's supported by the revenue stream.
COWELL: Yeah, and I think...I think folks sometime overly fixated on the bond rating's going to be the issue. I think, sometimes it's an ancillary issue. Like, the City of Raleigh called me when Dick's...the Dicksly's...would that effect their bond rating? It's, like, no, it's not going to effect your bond rating. It doesn't mean that it's a good idea or bad idea. But it's not going to effect your bond rating. It takes a lot, you know, to...to impact that. But that's not the only issue. There's obviously continuity of operations, those kinds of issues are probably the bigger...the bigger issues.
KALINER: So, how much guidance are you able...is your office able to offer and what does that sort of look like on a...on a merger deal if this thing does get through the courts at some point? And it's going to be a while.
COWELL: Yeah. We're working hard. We have a public counsel, where we've been trying to understand the bill, because, again...and having been a state senator...sometimes things are not well-drafted. I know it's hard to believe.
KALINER: Shocking.
COWELL: Yeah. And this one is...is been...the drafting was a little unclear. So, we are working both on that aspect as well as with the financial markets, the lawyers, to make sure that, you know, everything goes as smoothly as possible.
KALINER: North Carolina's treasurer Janet Cowell. We appreciate you stopping by today. Thank you very much. Are you heading back to Raleigh today or are you spending any time...?
COWELL: We are spending...so, if you have restaurant recommendations, we will be out on the town tonight...uh, yeah, we've got some more meetings tomorrow, so...
KALINER: All right. We appreciate you stopping by. Thanks so very much. Enjoy the rest of your stay here in the mountains.
COWELL: Thank you.
KALINER: Thank you.
Audio: https://soundcloud.com/tim-peck-994374558/janet-cowell-on-water-system-bonds
Transcript
KALINER: Your office has had a little bit of a role in our local debate over the water system. I guess you did a report or you gave an opinion to the effect of how a transfer, how this merger would or could impact the city's finances.
COWELL: So, yeah, to clarify, the Treasurer's Office...we are also very unique nationally in that out of the Depression came a system of oversight of local government. We had one hundred and sixty defaults during the Depression. Not good.
KALINER: Not all from here, though. Most of them, probably.
COWELL: Well, all over the state.
KALINER: There were...but...yeah, but there were a bunch from Asheville.
COWELL: All over the state.
KALINER: Yeah.
COWELL: And so we put in an oversight system, called the Local Government Commission run through the Treasurer's Office and we look at the finances for every single unit of government. We help them issue debt and just make sure that everything stand between the guard rails. In the situation with Asheville, we are sort of the technical adviser to the situation and all of this gets complicated because, actually, the bill is drafted strangely, so it was not clear: does this need to go through the Local Government Commission? But we're trying...my goal is to make sure that everything is smooth-functioning, that there's no disruption to the bond market in North Carolina, you know, that the operations continue and try to work with everyone to make sure that that is what happens.
KALINER: So, well, because Asheville city leadership has been saying that your office gave this report that basically supports their position that this could disrupt their credit rating.
COWELL: I think the piece that we spoke to is that there was some conception that: oh, this won't impact the...the, um, you know, the budget of the city and in fact, you know, there are city administrative services, like technology or the city manager, and you allocate portions of that, so there's a two million hit to their budget with this transfer and so we wrote a note explaining that, and showing... saying why that's legitimate, that's not a problem. But you just need to understand...
KALINER: That doesn't undermine their triple-A. That would not...a two million dollar hit.
COWELL: No, not in and of itself. And their documents have been much more clearly written. We have weighed in more on the Charlotte Airport because it is a...their documents on that bond transfer did not foresee a transfer. Asheville's did foresee a transfer. There are still complications, um, but in Charlotte it's also eight million dollars of outstanding bonds. That is a very big issuance and it is very unclear how that would all roll out.
KALINER: And I'm just...and you've also got...you've got the Feds involved on that side of it because you've got FAA stuff, I'm sure.
COWELL: Exactly. So...once...anything with airports, I think it's even more complicated than local. But we are also running a bill trying to clarify for water/sewer...you know, Asheville is a great system. You guys are solid, you're a very well-run unit. But that is the biggest problem with local government. I said it is not the Randy Parton Theaters or these, you know, crazy kind of entertainment complexes. Water/sewer is a huge problem. We're just trying to make a predictable path so that everybody can have a good system. If there is a change, or you do go regional, that there are clear guidelines and there are no surprises.
KALINER: Because the MSD, the Metropolitan Sewerage District that runs the sewer side of things, the regionalized, sort of, sewer system, they...they've got good bond...they've got a good bond rating as well.
COWELL: Yeah.
KALINER: So...and if these are Revenue Bonds versus G.O. Bonds, I would assume that the ownership follows...or the, you know, because it's supported by the revenue stream.
COWELL: Yeah, and I think...I think folks sometime overly fixated on the bond rating's going to be the issue. I think, sometimes it's an ancillary issue. Like, the City of Raleigh called me when Dick's...the Dicksly's...would that effect their bond rating? It's, like, no, it's not going to effect your bond rating. It doesn't mean that it's a good idea or bad idea. But it's not going to effect your bond rating. It takes a lot, you know, to...to impact that. But that's not the only issue. There's obviously continuity of operations, those kinds of issues are probably the bigger...the bigger issues.
KALINER: So, how much guidance are you able...is your office able to offer and what does that sort of look like on a...on a merger deal if this thing does get through the courts at some point? And it's going to be a while.
COWELL: Yeah. We're working hard. We have a public counsel, where we've been trying to understand the bill, because, again...and having been a state senator...sometimes things are not well-drafted. I know it's hard to believe.
KALINER: Shocking.
COWELL: Yeah. And this one is...is been...the drafting was a little unclear. So, we are working both on that aspect as well as with the financial markets, the lawyers, to make sure that, you know, everything goes as smoothly as possible.
KALINER: North Carolina's treasurer Janet Cowell. We appreciate you stopping by today. Thank you very much. Are you heading back to Raleigh today or are you spending any time...?
COWELL: We are spending...so, if you have restaurant recommendations, we will be out on the town tonight...uh, yeah, we've got some more meetings tomorrow, so...
KALINER: All right. We appreciate you stopping by. Thanks so very much. Enjoy the rest of your stay here in the mountains.
COWELL: Thank you.
KALINER: Thank you.
Thursday, October 22, 2015
Interview: Susan Fisher
WCQS has been sitting down with area lawmakers in the weeks since the legislature wrapped up its long session. Today, WCQS talked with Democratic Rep. Susan Fisher of Buncombe County:
...
WCQS: Sort of switching gears away from the budget for just a moment...um...that Asheville water ruling that just came down...
FISHER: Yes.
WCQS: ...what did you think about that?
FISHER: I was extremely disappointed. I will tell you that I was there in the court room for the hearing before the state appeals court and I thought that our folks did a superb job. I am not an attorney, I don't play one on TV, but from what I could observe, our representation was clear and cogent and really stated the case very well, um, but you have to, again, look at the panel of judges that we had there listening to that case, a Republican panel, and certainly not favorable toward cities as, um, that ruling sort of says. Judge Manning had ruled in our favor, this court did not. And the fact that it was unanimous is a disappointing factor, too, because often you cannot get the Supreme Court to take these cases if they've been ruled unanimously at a lower level. But we, I hold out hope that they will they will be able to take it further because we made a really good case, I thought.
WCQS: Why is that, do you think? Was it, um, I know one of the issues was compensation..
FISHER: Yes.
WCQS: ...which Asheville was not given any compensation.
FISHER: That's right.
WCQS: Do you think that's one of the key issues.
FISHER: It is one of the key issues. I think that, um, the City of Asheville has invested a great deal of money and policy effort toward protecting a watershed that is very important to this area and especially in a time where water is kind of beginning to be more and more at a premium. The city invested a lot, they're going to see very little return on that investment if this ruling stands.
RESPONSE:
Fisher implies that the ruling is suspect because the Appeals Court panel consisted of Republicans. She has nothing to say about the panel of 2 Democrats and 1 Republican that ruled against them in 2008. Court of Appeals of North Carolina. CITY OF ASHEVILLE, a municipal corporation, Plaintiff, v. Wake County STATE of North Carolina, and County of Buncombe, et al., Defendants. No. COA07-516. Decided: August 19, 2008. MARTIN, Chief Judge. Judges STEELMAN and STEPHENS concur:
http://caselaw.findlaw.com/nc-court-of-appeals/1396554.html
Fisher says "the City of Asheville has invested a great deal of money [in the water system]."Accurate but false. Actually, they merely managed loans on behalf of the ratepayers called Revenue Bonds. System ratepayers are on the hook for repayment. Water customers are the obligors. No city taxpayer money was invested. Asheville’s Revenue Bonds:
http://www.municipalbonds.com/bonds/issue/044074DX7
RELATED
...
WCQS: Sort of switching gears away from the budget for just a moment...um...that Asheville water ruling that just came down...
FISHER: Yes.
WCQS: ...what did you think about that?
FISHER: I was extremely disappointed. I will tell you that I was there in the court room for the hearing before the state appeals court and I thought that our folks did a superb job. I am not an attorney, I don't play one on TV, but from what I could observe, our representation was clear and cogent and really stated the case very well, um, but you have to, again, look at the panel of judges that we had there listening to that case, a Republican panel, and certainly not favorable toward cities as, um, that ruling sort of says. Judge Manning had ruled in our favor, this court did not. And the fact that it was unanimous is a disappointing factor, too, because often you cannot get the Supreme Court to take these cases if they've been ruled unanimously at a lower level. But we, I hold out hope that they will they will be able to take it further because we made a really good case, I thought.
WCQS: Why is that, do you think? Was it, um, I know one of the issues was compensation..
FISHER: Yes.
WCQS: ...which Asheville was not given any compensation.
FISHER: That's right.
WCQS: Do you think that's one of the key issues.
FISHER: It is one of the key issues. I think that, um, the City of Asheville has invested a great deal of money and policy effort toward protecting a watershed that is very important to this area and especially in a time where water is kind of beginning to be more and more at a premium. The city invested a lot, they're going to see very little return on that investment if this ruling stands.
RESPONSE:
Fisher implies that the ruling is suspect because the Appeals Court panel consisted of Republicans. She has nothing to say about the panel of 2 Democrats and 1 Republican that ruled against them in 2008. Court of Appeals of North Carolina. CITY OF ASHEVILLE, a municipal corporation, Plaintiff, v. Wake County STATE of North Carolina, and County of Buncombe, et al., Defendants. No. COA07-516. Decided: August 19, 2008. MARTIN, Chief Judge. Judges STEELMAN and STEPHENS concur:
http://caselaw.findlaw.com/nc-court-of-appeals/1396554.html
Fisher says "the City of Asheville has invested a great deal of money [in the water system]."Accurate but false. Actually, they merely managed loans on behalf of the ratepayers called Revenue Bonds. System ratepayers are on the hook for repayment. Water customers are the obligors. No city taxpayer money was invested. Asheville’s Revenue Bonds:
http://www.municipalbonds.com/bonds/issue/044074DX7
RELATED
- Water system question: https://soundcloud.com/tim-peck-994374558/susanfisher
- Full audio: http://wcqs.org/post/legislative-wrap-rep-susan-fisher
Wednesday, October 21, 2015
CIBO Candidate Forum 10.21.15
There seems to be a fundamental misunderstanding of the water merger by all six candidates for Asheville city council.
(candidate answers below taken from livetweeting by @DavidForbes )
First question: The latest Court of Appeals ruling was unanimous in transferring the water system from the City of Asheville to the Metropolitan Sewerage District. If this ultimately happens, how will you make up the loss of revenues and cash flow produced by the service?
Tim Peck: The City of Asheville would not experience any loss of revenue or cash flow produced by operating the public enterprise. It is illegal for the city to gain revenue or profit from the water system.
Haynes: hope we'll win, if not will deal closely w county and fight to prevent system being privatized.
Tim Peck: By law, the water system cannot be privatized.
Hunt: water $ goes to help fund gen services it uses (legal, payroll), making that up will be tough. State rule big negative.
Tim Peck: Water revenues can only go to water system support services.
Lee: amt from water loss would come out to about $2 million, weigh heavily. One thing wouldn't do so soon is prop tax/fee hike.
Tim Peck: There will be no loss. Water system revenues have to go toward operation and maintenance of the water system. The city makes no money from the public enterprise.
Mayfield: should use every resource to stop taking of system. Won't back down on city needs in face of Raleigh.
Tim Peck: Every resource?! Like unlimited taxpayer money?
Simerly: need to keep fighting, water system driven Asheville industry like brewing, coming here because of clean, pure water.
Tim Peck: The Water Act reorganizes management of the water system and changes nothing about the supply.
Young: should take every legal recourse. Tough times ahead if lose. Ideal wld be tda funds, but if not, may need cuts.
Tim Peck: Water system revenues do not go to the General Fund and do not fund services or special projects. Those revenues must stay within the system.
RELATED
Water question clip: http://www.tubechop.com/watch/7046801
Full Video: https://www.youtube.com/watch?v=RUoBAKBi2DQ (Water question at 34:04)
Mountain Xpress report:
After brief opening statements from each candidate, CIBO President Rod Hudgins, who acted as moderator, asked: “The latest Court of Appeals ruling was unanimous in transferring the water system from the City of Asheville to the MSD (Metropolitan Sewerage District). If this ultimately happens, how will you make up the loss of revenues and cash flow produced by the service?”
Brian Haynes expressed his hope that the city will win in its fight to retain control of the system. If it does not, then the city should work with the county to ensure that the water system does not become privatized. That would be “the worst thing that could happen,” Haynes concluded.
Current council member and Vice Mayor Marc Hunt reported that revenue from the water system currently accounts for a little less than a third of all city revenue, and that those system-related revenues defray some of the overhead costs shared among city departments. City Manager Gary Jackson began contingency planning for the possible transfer of the system two years ago, said Hunt, but if it happens, “it is going to be tough.” There are some tentative thoughts around how that would happen.
Rich Lee said the city would take a financial hit of about $2 million in the event of a transfer. Coming on the heels of last year’s state-mandated discontinuation of the business privilege license tax (which resulted in a loss of $1.5 million), a water system transfer would be another blow to the city’s ability to generate revenue. However, Lee “won’t contemplate another tax increase” immediately after last year’s increase in the property tax rate, and said the city will have to find other places to make up the difference.
“The city must continue to invest in doing whatever we can to save the water system,” Julie Mayfield contributed. If the transfer occurs, the city will have to look for opportunities for savings. Mayfield offered a caveat: “I am not interested in backing up the city or stopping progress on the many needs we have around affordable housing and transportation infrastructure.”
Lindsey Simerly pointed out that control of Asheville’s water system affects much more than just city revenues. Employers and the jobs they create are attracted to the city by its plentiful supply of high quality water, she said.
Keith Young agreed that every legal avenue for fighting the transfer must be exhausted. If, despite those efforts, control of the system goes to the MSD, Young suggested looking to funds from the hotel occupancy tax administered by the Tourism Development Authority. Young acknowledged that recent efforts to spark conversations about funneling some of those funds (which are mandated by the state government to be used for travel and tourism-related advertising) toward infrastructure and public safety costs have not yielded results.
(candidate answers below taken from livetweeting by @DavidForbes )
First question: The latest Court of Appeals ruling was unanimous in transferring the water system from the City of Asheville to the Metropolitan Sewerage District. If this ultimately happens, how will you make up the loss of revenues and cash flow produced by the service?
Tim Peck: The City of Asheville would not experience any loss of revenue or cash flow produced by operating the public enterprise. It is illegal for the city to gain revenue or profit from the water system.
Haynes: hope we'll win, if not will deal closely w county and fight to prevent system being privatized.
Tim Peck: By law, the water system cannot be privatized.
Hunt: water $ goes to help fund gen services it uses (legal, payroll), making that up will be tough. State rule big negative.
Tim Peck: Water revenues can only go to water system support services.
Lee: amt from water loss would come out to about $2 million, weigh heavily. One thing wouldn't do so soon is prop tax/fee hike.
Tim Peck: There will be no loss. Water system revenues have to go toward operation and maintenance of the water system. The city makes no money from the public enterprise.
Mayfield: should use every resource to stop taking of system. Won't back down on city needs in face of Raleigh.
Tim Peck: Every resource?! Like unlimited taxpayer money?
Simerly: need to keep fighting, water system driven Asheville industry like brewing, coming here because of clean, pure water.
Tim Peck: The Water Act reorganizes management of the water system and changes nothing about the supply.
Young: should take every legal recourse. Tough times ahead if lose. Ideal wld be tda funds, but if not, may need cuts.
Tim Peck: Water system revenues do not go to the General Fund and do not fund services or special projects. Those revenues must stay within the system.
RELATED
Water question clip: http://www.tubechop.com/watch/7046801
Full Video: https://www.youtube.com/watch?v=RUoBAKBi2DQ (Water question at 34:04)
Mountain Xpress report:
After brief opening statements from each candidate, CIBO President Rod Hudgins, who acted as moderator, asked: “The latest Court of Appeals ruling was unanimous in transferring the water system from the City of Asheville to the MSD (Metropolitan Sewerage District). If this ultimately happens, how will you make up the loss of revenues and cash flow produced by the service?”
Brian Haynes expressed his hope that the city will win in its fight to retain control of the system. If it does not, then the city should work with the county to ensure that the water system does not become privatized. That would be “the worst thing that could happen,” Haynes concluded.
Current council member and Vice Mayor Marc Hunt reported that revenue from the water system currently accounts for a little less than a third of all city revenue, and that those system-related revenues defray some of the overhead costs shared among city departments. City Manager Gary Jackson began contingency planning for the possible transfer of the system two years ago, said Hunt, but if it happens, “it is going to be tough.” There are some tentative thoughts around how that would happen.
Rich Lee said the city would take a financial hit of about $2 million in the event of a transfer. Coming on the heels of last year’s state-mandated discontinuation of the business privilege license tax (which resulted in a loss of $1.5 million), a water system transfer would be another blow to the city’s ability to generate revenue. However, Lee “won’t contemplate another tax increase” immediately after last year’s increase in the property tax rate, and said the city will have to find other places to make up the difference.
“The city must continue to invest in doing whatever we can to save the water system,” Julie Mayfield contributed. If the transfer occurs, the city will have to look for opportunities for savings. Mayfield offered a caveat: “I am not interested in backing up the city or stopping progress on the many needs we have around affordable housing and transportation infrastructure.”
Lindsey Simerly pointed out that control of Asheville’s water system affects much more than just city revenues. Employers and the jobs they create are attracted to the city by its plentiful supply of high quality water, she said.
Keith Young agreed that every legal avenue for fighting the transfer must be exhausted. If, despite those efforts, control of the system goes to the MSD, Young suggested looking to funds from the hotel occupancy tax administered by the Tourism Development Authority. Young acknowledged that recent efforts to spark conversations about funneling some of those funds (which are mandated by the state government to be used for travel and tourism-related advertising) toward infrastructure and public safety costs have not yielded results.
Monday, October 19, 2015
Water System Civil War
Asheville Politics Facebook thread
Letters to the Editor
ASHEVILLE POLITICS
Facebook thread, Oct 15-18, 2015
BARRY SUMMERS: Julie - I've held my tongue this long (for the most part), but this is too much. Where was this "whatever is necessary" talk when we were meeting on the water issue two - three years ago? A number of our group, SaveOurWaterWNC, met with you and others to try to craft a defense against this act of piracy, and I'd have to say you were the most conservative of us by far. In fact, anything that might ruffle feathers - you were against. And I have a certain group of feathers in mind: anything that would make Chuck McGrady mad, you were against.
Mountain Voices Alliance proposed a forum that would pit McGrady & Moffitt against Council members, Clean Water advocates, the Downtown Association, and our group... and you tried to talk us into cancelling it.
Asheville City Council voted unanimously to urge Gov. Perdue to veto the pre-seizure bill, H1009, that set the stage for the seizure to come. Our group lobbied hard to get the Gov. to veto... you urged her NOT to veto the bill. Your principal reason? We don't want to make the Republicans mad (read: Chuck won't like it.)
And the things you said in our meetings: 'What provisions do we want Chuck to put in the bill? I know, we're still against the bill, but Chuck says he'll put in things like environmental protections etc. if we ask.' Julie, it still amazes me that we had to ASK YOU to stop meeting with Chuck and acting as if you were negotiating for us.
'Chuck will keep Moffitt from making the bill any worse than it already is.' Julie, CHUCK was the one driving this (and still is), not Moffitt. I met with Chuck McGrady very early on, Julie, and he told me flatly that it was HIS idea to take Moffitt's ridiculous one-page bill and turn it into a study committee instead, and that's where it was honed into something that might pass constitutional muster.
'At the end of the day, I think we'll be glad that Chuck is working on this bill'. No words come to express my outrage over the fact that you thought we were that stupid.
Julie, I know that you lied to me on at least one occasion about something that I had tried to set in motion,that might have changed the game. But it would have been horribly politically damaging to Chuck, so I should have known better.
We proposed staging protests at McGrady/Moffitt/Ramsey offices or homes, and you were against that. This was the point where the other statewide groups like Sierra Club, American Rivers, League of Conservation Voters, etc. all started dropping out of working with us, with one saying explicitly that they couldn't afford to anger the one "good" Republican on the environment, Chuck McGrady. It isn't a coincidence that YOU were the Chair of their umbrella group, the NC Conservation Network that year, and that you all thought that Chuck would be your guy on fracking (he wasn't) and offshore drilling (he didn't) and coal ash (he wouldn't)? We got the sense that who controls Asheville's water system was small potatoes compared to those, and Chuck was the one dangling them in front of you.
Everyone should read the 'legislator profile' of Chuck McGrady on Julie's MountainTrue website. Other than that one sentence buried halfway down the second page about how much she disagrees on the water issue, the rest reads like a love letter.
http://mountaintrue.org/wp-content/uploads/2015/07/McGrady-Profilev31.pdf
We received tepid support from Julie on some of the things we tried to do - the petition, the rallies, the referendum, etc. It would have been conspicuous had she not. As long as it wasn't really in Chuck's face, she wasn't opposed. WNC Alliance members were great - several of our group are also WNCA members, of course. But Julie was a different story.
Julie has known that I and others in our group felt this way for a long time ("Barry - let's get together to talk about our differing recollections on how we worked together"). But the pressure to not form a circular firing squad is strong, and so I've resisted. But lord, Julie. The "whatever is necessary" talk you're waving around now that you're running for office is just too insulting for those of us who HAVE been fighting.
You were fighting back then alright - fighting to protect your political currency, your relationship with Chuck. What happens the next time he comes to bully the City over something, as we all know he will? Do we want someone on Council who will be trying to decide which master she is supposed to serve every time this happens? This is a critical time for Asheville, and I'd like to see people on Council who we KNOW will be fighting for the City.
BETH JEZEK: My memory of what took place closely matches Barry's. At the time I thought Julie was politically naive. I now believe her actions had more to do with her political ambitions than with her desire to save the water. It is politically expedient to oppose Chuck McGrady's legislation now that City Council has voted unanimously to appeal the court's decision. I respect Julie's intelligence and her ability to articulate the issues. I do not trust her.
ELAINE LITE: Barry didn't say Julie was working for the enemy, but that she was working for herself. It was important to her to stay on Chuck's good side for her to retain her clout in the environmental work she does, so she tried to keep us from making him mad. Unfortunately, that was going to be an unavoidable side effect of actually prevailing on the water issue, so she put herself in the position of weakening our unified response.
JULIE MAYFIELD: Ah, at last Barry emerges from the shadows. We do have different opinions of what happened back then, so let me be clear for the folks watching from home. You and I stood completely aligned on the goal of Asheville keeping its water system. There is, and never has been, any daylight between us on that. What we differed on was strategy and tactics - MVA took a more aggressive approach, but WNCA was fully engaged: I testified at the legislative hearing in opposition to the bill, we hired phone bankers who called thousands of people to ask them to vote No on the referendum; we took out a full page add in the AC-T (which MVA signed on to), I drafted a resolution that other local governments adopted in opposition to the takeover, I secured not one but two of the full-time environmental lobbyists in Raleigh to be our eyes and ears on the ground every day (American Rivers and NC League of Conservation Voters). Our group meetings happened at our office and I took the minutes. We have never disagreed that Asheville should keep its water system.
Did I meet with Chuck McGrady to talk about the bill? Yes, along with the Sierra Club. Did we have anything to offer or give Chuck to do what we wanted, which was for him to stand down? No. Absent that, did we hope that Chuck would improve the bill and make it not so punishing? Yes. Did that happen? Only slightly.
Do I disagree with Chuck on this? You bet. Does he know that? Absolutely. Does he know that if I’m elected, he and I will fight about it? Yep - I made that perfectly earlier this year. Do I also work with him on a range of other issues where he is incredibly helpful? Yes. Did he prevent some terrible provisions from becoming law this year and last year and the year before that? Yes and you would be happy he was there on those issues.
The bottom line is this: Asheville was not going to win the legislative fight on the water bill. All we could hope for was this the bill wouldn’t be the worst possible. The full-time lobbyists working with us knew that too and pulled out when MVA took what they viewed to be an unconstructive approach (I chaired NCCN’s board, not NCLCV’s board, so I had no influence in that decision). No amount of grassroots lobbying or calling for vetoes was going to change any of that. The fight needed to happen, and WNCA and MVA played different roles. We didn’t – and didn’t have to - agree on everything.
We’re on a different playing field now. No amount of lobbying or discussion will change the outcome now since it’s in the court’s hands. You can ask anyone else involved in working on the water bills back then – city staff and elected officials, the city’s lobbyist, environmental lobbyists, business leaders - where I stood and they will tell you: firmly in the court of Asheville keeping its water system.
BARRY SUMMERS: "The bottom line is..."
There it is. All of us who thought it was important to fight with all means necessary, were deluding ourselves, according to Julie. She determined that it was already a lost cause, and then set out to work on the bill with Chuck. WNCs leading environmentalist sent the signal that in her estimation, those of us who were still fighting were wasting our time. The fact that this is precisely what Chuck wanted, well... And she kept telling US that she was committed to fighting the bill, while in OTHER meetings, it was officially unwinnable already. Julie, did you tell City Council that you were lobbying against the veto that they were lobbying FOR?
After a meeting in Hendersonville mid-2013, a former DENR official said to me, "People around the state know that I know Asheville water issues, and they ask me: Why is Asheville being so passive?" I didn't know what to tell him, other than that there were some who thought that the fight was unwinnable. Here's the confirmation from Julie.
The Goethe quote, "Act boldly and mighty forces will come to your aid," has a corollary: "Signal your surrender, and mighty forces will stand back and watch you get the tar kicked out of you".
We'll never know what might have happened had Julie not been working against us and the City. I just know that the situation now is as bad as if we hadn't lifted a finger. I want to see people on City Council who haven't thrown in the towel before the next round starts.
From the "shadows"? Really Julie?
CECIL BOTHWELL: Cave first, negotiate later?
JULIE MAYFIELD: To be clear, I was not working against anything or anyone. I simply did not do everything you wanted to do and did. I never undercut or made what you or City Council or anyone else did less effective. I did not ask City Council not to request a veto and I certainly never urged Perdue not to veto the first bill. That would have been ridiculous. There are many forms of partnership and teamwork - in our case, we were singing from the same song book but off of different pages. I accept, and even embrace, that groups work in different ways and have different strengths - it takes groups of all kinds to mount effective campaigns. I never, ever undercut my partners - even when I don't agree with everything they do. I may not join them or I may distance myself from them, but I never undercut. Even though we didn't agree on everything, we still shared a common enemy and a common goal of Asheville keeping its water system. That was far more important than any differences you and I might have had. I am sorry we continue to see it differently.
CECIL BOTHWELL: And so, distance yourself from Marc Hunt?
JULIE MAYFIELD: Not sure what you mean Cecil Bothwell. Marc was working hard on the watershed protection piece of the puzzle. My communications were directly with Esther on the legislation.
BARRY SUMMERS: Julie Mayfield gives him a glowing review (below):
http://mountaintrue.org/wp-content/uploads/2015/07/McGrady-Profilev31.pdf
LETTERS TO THE EDITOR
Mayfield failed to fight hard for city water system
Barry Summers | MX | October 28, 2015
As we fought the oncoming state seizure of Asheville’s water system, members of our group, SaveOurWaterWNC, met over a number of months with WNC Alliance Director Julie Mayfield and other environmental leaders to try to craft a unified response.
We eventually quit working with Julie after it became clear to us that it was more important to her to protect her relationship with the “good” Republican on the environment, Rep. Chuck McGrady, than to fight really hard for the city of Asheville. This impression came from her attempts to get us to “work’” with Chuck to make the bill less bad, if it happened to pass. It came from Julie’s opposition to Gov. [Bev] Perdue vetoing the precursor Metropolitan Sewerage District bill, which we and a unanimous City Council were lobbying her to do.
It came from her opposition to actions we proposed, like the Mountain Voices Alliance forum, which put Reps. McGrady and [Tim] Moffitt face-to-face with angry Asheville opponents to the seizure. Julie tried to get us to cancel it. And, it came out of the other environmental representatives dropping out of the fight, one stating explicitly that he “can’t afford to make McGrady mad.” This was a common refrain from Julie that we should avoid doing anything that would anger the Republicans, especially Chuck McGrady.
And we found it significant that that year, she was the chair of the NC Conservation Network, the umbrella group for all the environmental groups in the state. There was much more, and all this was documented in emails to our working group.
It’s well known that McGrady (one of the sponsors of the seizure bill), currently holds the keys to moving any environmental legislation forward. This is Julie’s professional bread and butter – her access to Chuck McGrady. It’s also well-known that McGrady is going to be the chief enforcer of Raleigh’s will over the city for the foreseeable future.
City Council will have tough decisions to make, over the water and many other issues, and confrontations with McGrady are all but assured.
Do we want someone on City Council during this critical time that has such a serious conflict of interest? I want Julie to succeed in her environmental work — but Asheville residents shouldn’t have to wonder if she’s sacrificing one to succeed at the other.
http://mountainx.com/opinion/letter-writer-mayfield-failed-to-fight-hard-for-city-water-system/
Mayfield says experience with legislators makes her more effective
Julie Mayfield | MX | October 28, 2015 by Letters
Barry Summers would have you believe that I was not sufficiently committed to fighting the legislative takeover of the Asheville water system, led by former Rep. Tim Moffitt and current Rep. Chuck McGrady. Here is just some of what the WNC Alliance and I did during that fight:
We stood completely aligned with SaveOurWaterNC on the goal of protecting Asheville’s water system. We differed only on strategy and tactics and, therefore, sometimes did different things. Everyone else involved in the water fight knew where I stood, including Rep. McGrady, and I have disagreed with him on this publicly. I have also told him that, if elected, I will fight him on the issue again if need be.
Asheville voters do not need to question my willingness or ability to fight for Asheville and its water system in Raleigh. Indeed, rather than creating a conflict of interest as suggested, my experience with the legislature and my relationships with our entire WNC delegation only make me more effective.
http://mountainx.com/opinion/letter-writer-mayfield-says-experience-with-legislators-makes-her-more-effective/
Mayfield didn’t represent in water system negotiations
Beth Jezek | MX | November 1, 2015
Many of us fought long and hard to keep Raleigh from taking Asheville’s water [system]. Julie Mayfield was there fighting with us.
Or that’s what we thought. We learned that Julie had been meeting with one of the authors of the bill, Rep. Chuck McGrady (R-Henderson), in an effort to gain minor concessions on the bill in return for us softening our opposition.
Mayfield was not authorized to represent our group, and it’s common knowledge that the water bill that was passed couldn’t be much worse. (If you are interested in the details, see SaveOurWaterWNC)
Julie cannot be trusted to represent us on City Council. What devil would she secretly attempt to cut her next deal with?
http://mountainx.com/opinion/letter-writer-mayfield-didnt-represent-in-water-system-negotiations/
Letters to the Editor
ASHEVILLE POLITICS
Facebook thread, Oct 15-18, 2015
Mountain Voices Alliance proposed a forum that would pit McGrady & Moffitt against Council members, Clean Water advocates, the Downtown Association, and our group... and you tried to talk us into cancelling it.
Asheville City Council voted unanimously to urge Gov. Perdue to veto the pre-seizure bill, H1009, that set the stage for the seizure to come. Our group lobbied hard to get the Gov. to veto... you urged her NOT to veto the bill. Your principal reason? We don't want to make the Republicans mad (read: Chuck won't like it.)
And the things you said in our meetings: 'What provisions do we want Chuck to put in the bill? I know, we're still against the bill, but Chuck says he'll put in things like environmental protections etc. if we ask.' Julie, it still amazes me that we had to ASK YOU to stop meeting with Chuck and acting as if you were negotiating for us.
'Chuck will keep Moffitt from making the bill any worse than it already is.' Julie, CHUCK was the one driving this (and still is), not Moffitt. I met with Chuck McGrady very early on, Julie, and he told me flatly that it was HIS idea to take Moffitt's ridiculous one-page bill and turn it into a study committee instead, and that's where it was honed into something that might pass constitutional muster.
'At the end of the day, I think we'll be glad that Chuck is working on this bill'. No words come to express my outrage over the fact that you thought we were that stupid.
Julie, I know that you lied to me on at least one occasion about something that I had tried to set in motion,that might have changed the game. But it would have been horribly politically damaging to Chuck, so I should have known better.
We proposed staging protests at McGrady/Moffitt/Ramsey offices or homes, and you were against that. This was the point where the other statewide groups like Sierra Club, American Rivers, League of Conservation Voters, etc. all started dropping out of working with us, with one saying explicitly that they couldn't afford to anger the one "good" Republican on the environment, Chuck McGrady. It isn't a coincidence that YOU were the Chair of their umbrella group, the NC Conservation Network that year, and that you all thought that Chuck would be your guy on fracking (he wasn't) and offshore drilling (he didn't) and coal ash (he wouldn't)? We got the sense that who controls Asheville's water system was small potatoes compared to those, and Chuck was the one dangling them in front of you.
Everyone should read the 'legislator profile' of Chuck McGrady on Julie's MountainTrue website. Other than that one sentence buried halfway down the second page about how much she disagrees on the water issue, the rest reads like a love letter.
http://mountaintrue.org/wp-content/uploads/2015/07/McGrady-Profilev31.pdf
We received tepid support from Julie on some of the things we tried to do - the petition, the rallies, the referendum, etc. It would have been conspicuous had she not. As long as it wasn't really in Chuck's face, she wasn't opposed. WNC Alliance members were great - several of our group are also WNCA members, of course. But Julie was a different story.
Julie has known that I and others in our group felt this way for a long time ("Barry - let's get together to talk about our differing recollections on how we worked together"). But the pressure to not form a circular firing squad is strong, and so I've resisted. But lord, Julie. The "whatever is necessary" talk you're waving around now that you're running for office is just too insulting for those of us who HAVE been fighting.
You were fighting back then alright - fighting to protect your political currency, your relationship with Chuck. What happens the next time he comes to bully the City over something, as we all know he will? Do we want someone on Council who will be trying to decide which master she is supposed to serve every time this happens? This is a critical time for Asheville, and I'd like to see people on Council who we KNOW will be fighting for the City.
BETH JEZEK: My memory of what took place closely matches Barry's. At the time I thought Julie was politically naive. I now believe her actions had more to do with her political ambitions than with her desire to save the water. It is politically expedient to oppose Chuck McGrady's legislation now that City Council has voted unanimously to appeal the court's decision. I respect Julie's intelligence and her ability to articulate the issues. I do not trust her.
ELAINE LITE: Barry didn't say Julie was working for the enemy, but that she was working for herself. It was important to her to stay on Chuck's good side for her to retain her clout in the environmental work she does, so she tried to keep us from making him mad. Unfortunately, that was going to be an unavoidable side effect of actually prevailing on the water issue, so she put herself in the position of weakening our unified response.
JULIE MAYFIELD: Ah, at last Barry emerges from the shadows. We do have different opinions of what happened back then, so let me be clear for the folks watching from home. You and I stood completely aligned on the goal of Asheville keeping its water system. There is, and never has been, any daylight between us on that. What we differed on was strategy and tactics - MVA took a more aggressive approach, but WNCA was fully engaged: I testified at the legislative hearing in opposition to the bill, we hired phone bankers who called thousands of people to ask them to vote No on the referendum; we took out a full page add in the AC-T (which MVA signed on to), I drafted a resolution that other local governments adopted in opposition to the takeover, I secured not one but two of the full-time environmental lobbyists in Raleigh to be our eyes and ears on the ground every day (American Rivers and NC League of Conservation Voters). Our group meetings happened at our office and I took the minutes. We have never disagreed that Asheville should keep its water system.
Did I meet with Chuck McGrady to talk about the bill? Yes, along with the Sierra Club. Did we have anything to offer or give Chuck to do what we wanted, which was for him to stand down? No. Absent that, did we hope that Chuck would improve the bill and make it not so punishing? Yes. Did that happen? Only slightly.
Do I disagree with Chuck on this? You bet. Does he know that? Absolutely. Does he know that if I’m elected, he and I will fight about it? Yep - I made that perfectly earlier this year. Do I also work with him on a range of other issues where he is incredibly helpful? Yes. Did he prevent some terrible provisions from becoming law this year and last year and the year before that? Yes and you would be happy he was there on those issues.
The bottom line is this: Asheville was not going to win the legislative fight on the water bill. All we could hope for was this the bill wouldn’t be the worst possible. The full-time lobbyists working with us knew that too and pulled out when MVA took what they viewed to be an unconstructive approach (I chaired NCCN’s board, not NCLCV’s board, so I had no influence in that decision). No amount of grassroots lobbying or calling for vetoes was going to change any of that. The fight needed to happen, and WNCA and MVA played different roles. We didn’t – and didn’t have to - agree on everything.
We’re on a different playing field now. No amount of lobbying or discussion will change the outcome now since it’s in the court’s hands. You can ask anyone else involved in working on the water bills back then – city staff and elected officials, the city’s lobbyist, environmental lobbyists, business leaders - where I stood and they will tell you: firmly in the court of Asheville keeping its water system.
BARRY SUMMERS: "The bottom line is..."
There it is. All of us who thought it was important to fight with all means necessary, were deluding ourselves, according to Julie. She determined that it was already a lost cause, and then set out to work on the bill with Chuck. WNCs leading environmentalist sent the signal that in her estimation, those of us who were still fighting were wasting our time. The fact that this is precisely what Chuck wanted, well... And she kept telling US that she was committed to fighting the bill, while in OTHER meetings, it was officially unwinnable already. Julie, did you tell City Council that you were lobbying against the veto that they were lobbying FOR?
After a meeting in Hendersonville mid-2013, a former DENR official said to me, "People around the state know that I know Asheville water issues, and they ask me: Why is Asheville being so passive?" I didn't know what to tell him, other than that there were some who thought that the fight was unwinnable. Here's the confirmation from Julie.
The Goethe quote, "Act boldly and mighty forces will come to your aid," has a corollary: "Signal your surrender, and mighty forces will stand back and watch you get the tar kicked out of you".
We'll never know what might have happened had Julie not been working against us and the City. I just know that the situation now is as bad as if we hadn't lifted a finger. I want to see people on City Council who haven't thrown in the towel before the next round starts.
From the "shadows"? Really Julie?
CECIL BOTHWELL: Cave first, negotiate later?
JULIE MAYFIELD: To be clear, I was not working against anything or anyone. I simply did not do everything you wanted to do and did. I never undercut or made what you or City Council or anyone else did less effective. I did not ask City Council not to request a veto and I certainly never urged Perdue not to veto the first bill. That would have been ridiculous. There are many forms of partnership and teamwork - in our case, we were singing from the same song book but off of different pages. I accept, and even embrace, that groups work in different ways and have different strengths - it takes groups of all kinds to mount effective campaigns. I never, ever undercut my partners - even when I don't agree with everything they do. I may not join them or I may distance myself from them, but I never undercut. Even though we didn't agree on everything, we still shared a common enemy and a common goal of Asheville keeping its water system. That was far more important than any differences you and I might have had. I am sorry we continue to see it differently.
CECIL BOTHWELL: And so, distance yourself from Marc Hunt?
JULIE MAYFIELD: Not sure what you mean Cecil Bothwell. Marc was working hard on the watershed protection piece of the puzzle. My communications were directly with Esther on the legislation.
BARRY SUMMERS: Julie Mayfield gives him a glowing review (below):
http://mountaintrue.org/wp-content/uploads/2015/07/McGrady-Profilev31.pdf
LETTERS TO THE EDITOR
Mayfield failed to fight hard for city water system
Barry Summers | MX | October 28, 2015
As we fought the oncoming state seizure of Asheville’s water system, members of our group, SaveOurWaterWNC, met over a number of months with WNC Alliance Director Julie Mayfield and other environmental leaders to try to craft a unified response.
We eventually quit working with Julie after it became clear to us that it was more important to her to protect her relationship with the “good” Republican on the environment, Rep. Chuck McGrady, than to fight really hard for the city of Asheville. This impression came from her attempts to get us to “work’” with Chuck to make the bill less bad, if it happened to pass. It came from Julie’s opposition to Gov. [Bev] Perdue vetoing the precursor Metropolitan Sewerage District bill, which we and a unanimous City Council were lobbying her to do.
It came from her opposition to actions we proposed, like the Mountain Voices Alliance forum, which put Reps. McGrady and [Tim] Moffitt face-to-face with angry Asheville opponents to the seizure. Julie tried to get us to cancel it. And, it came out of the other environmental representatives dropping out of the fight, one stating explicitly that he “can’t afford to make McGrady mad.” This was a common refrain from Julie that we should avoid doing anything that would anger the Republicans, especially Chuck McGrady.
And we found it significant that that year, she was the chair of the NC Conservation Network, the umbrella group for all the environmental groups in the state. There was much more, and all this was documented in emails to our working group.
It’s well known that McGrady (one of the sponsors of the seizure bill), currently holds the keys to moving any environmental legislation forward. This is Julie’s professional bread and butter – her access to Chuck McGrady. It’s also well-known that McGrady is going to be the chief enforcer of Raleigh’s will over the city for the foreseeable future.
City Council will have tough decisions to make, over the water and many other issues, and confrontations with McGrady are all but assured.
Do we want someone on City Council during this critical time that has such a serious conflict of interest? I want Julie to succeed in her environmental work — but Asheville residents shouldn’t have to wonder if she’s sacrificing one to succeed at the other.
http://mountainx.com/opinion/letter-writer-mayfield-failed-to-fight-hard-for-city-water-system/
Mayfield says experience with legislators makes her more effective
Julie Mayfield | MX | October 28, 2015 by Letters
Barry Summers would have you believe that I was not sufficiently committed to fighting the legislative takeover of the Asheville water system, led by former Rep. Tim Moffitt and current Rep. Chuck McGrady. Here is just some of what the WNC Alliance and I did during that fight:
- I testified in opposition to the bill at a legislative hearing.
- We took out a full-page ad in Mountain Xpress calling on people to vote “No” on the 2012 referendum.
- We hired phone bankers who called and asked thousands of Asheville residents to vote no.
- I drafted a resolution that other local governments adopted in opposition to the takeover.
- I secured the help of two full-time environmental lobbyists in Raleigh.
- We promoted the forum Barry references, and we hosted an Asheville Green Drinks on the topic.
- We worked closely with the city and its lobbyists, making sure our local grassroots strategy supported their efforts.
We stood completely aligned with SaveOurWaterNC on the goal of protecting Asheville’s water system. We differed only on strategy and tactics and, therefore, sometimes did different things. Everyone else involved in the water fight knew where I stood, including Rep. McGrady, and I have disagreed with him on this publicly. I have also told him that, if elected, I will fight him on the issue again if need be.
Asheville voters do not need to question my willingness or ability to fight for Asheville and its water system in Raleigh. Indeed, rather than creating a conflict of interest as suggested, my experience with the legislature and my relationships with our entire WNC delegation only make me more effective.
http://mountainx.com/opinion/letter-writer-mayfield-says-experience-with-legislators-makes-her-more-effective/
Mayfield didn’t represent in water system negotiations
Beth Jezek | MX | November 1, 2015
Many of us fought long and hard to keep Raleigh from taking Asheville’s water [system]. Julie Mayfield was there fighting with us.
Or that’s what we thought. We learned that Julie had been meeting with one of the authors of the bill, Rep. Chuck McGrady (R-Henderson), in an effort to gain minor concessions on the bill in return for us softening our opposition.
Mayfield was not authorized to represent our group, and it’s common knowledge that the water bill that was passed couldn’t be much worse. (If you are interested in the details, see SaveOurWaterWNC)
Julie cannot be trusted to represent us on City Council. What devil would she secretly attempt to cut her next deal with?
http://mountainx.com/opinion/letter-writer-mayfield-didnt-represent-in-water-system-negotiations/
Friday, October 09, 2015
LTE: Water Lawsuit
Time for city to end frivolous lawsuits
Asheville Citizen-Times | October 8, 2015
The City of Asheville has lost its lawsuit over management of the water system.
Asheville City Council’s expensive and unnecessary lawsuit has cost taxpayers close to a million dollars and taxpayers are paying for both sides of the dispute. The mayor has promised the city will appeal. Enough.
The law is clear. It is time for City Council to stop wasting taxpayer money on frivolous lawsuits. It is time for City Council to obey the law and loosen its grip on the people’s water system.
It’s time for all water system customers to be represented on a regional water authority.
Tim Peck, Asheville
FURTHER READING
Asheville legal bills in water case top $550,000. That's how much was spent BEFORE the appeal. It's closer to $1M at this point. That's not counting the $57 million lost by rejecting the compensation offer by MSD.
http://www.citizen-times.com/story/news/local/2014/11/01/asheville-legal-bills-water-case-top/18350277/
Yes, the city was offered $57M for the water system by MSD. That was a discounted value taking into account the money the city had already stolen from the system. They turned down the offer of compensation because they thought it wasn't enough. Now they have lost the water system AND the $57 million.
https://www.scribd.com/doc/141200057/MSD-Compensation-Offer
The mayor is already promising to spend gobs of taxpayer money to continue fighting a losing battle.
https://twitter.com/EstherManheimer/status/651412919373156352
An appeal by the City of a unanimous decision, citing SCOTUS, will only delay the inevitable by perhaps a few months. There was no dissent and, therefore, no basis for the state Supreme Court to hear an appeal. If the city does file cert as promised, it is likely to be summarily thrown out. I'd like to have a little chat with the mayor right about then.In the end, the city will turn over the water system to the people who use and depend on it.
https://twitter.com/ChuckMcGrady/status/476195246943264769
This is the THIRD time the City of Asheville has lost in court over the water system.
1. Candler v. Asheville (1958). Status: Lost
http://bit.ly/1NnG8lp
2. Asheville v. State (2007). Status: Lost
http://bit.ly/1Ll0Ifv
3. Asheville v. State (2013). Status: Lost
http://bit.ly/1Q5E1jK
In 2012, Senator Nesbitt (D) commented on the futility of the water fight:
https://www.youtube.com/watch?t=3915&v=6z_uDm4h-yY
The Water System in Blog Posts:
http://timpeck.blogspot.com/search/label/water%20system
The Regionalization of Public Utilities: An idea whose time has come . . . again.
http://nchouse117.com/water-bill/
MSD Merger Study, March 20, 2013
http://www.msdbc.org/documents/waterstudy/final/FinalMergerStudy032013.pdf
Asheville Citizen-Times | October 8, 2015
The City of Asheville has lost its lawsuit over management of the water system.
Asheville City Council’s expensive and unnecessary lawsuit has cost taxpayers close to a million dollars and taxpayers are paying for both sides of the dispute. The mayor has promised the city will appeal. Enough.
The law is clear. It is time for City Council to stop wasting taxpayer money on frivolous lawsuits. It is time for City Council to obey the law and loosen its grip on the people’s water system.
It’s time for all water system customers to be represented on a regional water authority.
Tim Peck, Asheville
FURTHER READING
Asheville legal bills in water case top $550,000. That's how much was spent BEFORE the appeal. It's closer to $1M at this point. That's not counting the $57 million lost by rejecting the compensation offer by MSD.
http://www.citizen-times.com/story/news/local/2014/11/01/asheville-legal-bills-water-case-top/18350277/
Yes, the city was offered $57M for the water system by MSD. That was a discounted value taking into account the money the city had already stolen from the system. They turned down the offer of compensation because they thought it wasn't enough. Now they have lost the water system AND the $57 million.
https://www.scribd.com/doc/141200057/MSD-Compensation-Offer
The mayor is already promising to spend gobs of taxpayer money to continue fighting a losing battle.
https://twitter.com/EstherManheimer/status/651412919373156352
An appeal by the City of a unanimous decision, citing SCOTUS, will only delay the inevitable by perhaps a few months. There was no dissent and, therefore, no basis for the state Supreme Court to hear an appeal. If the city does file cert as promised, it is likely to be summarily thrown out. I'd like to have a little chat with the mayor right about then.In the end, the city will turn over the water system to the people who use and depend on it.
https://twitter.com/ChuckMcGrady/status/476195246943264769
This is the THIRD time the City of Asheville has lost in court over the water system.
1. Candler v. Asheville (1958). Status: Lost
http://bit.ly/1NnG8lp
2. Asheville v. State (2007). Status: Lost
http://bit.ly/1Ll0Ifv
3. Asheville v. State (2013). Status: Lost
http://bit.ly/1Q5E1jK
In 2012, Senator Nesbitt (D) commented on the futility of the water fight:
https://www.youtube.com/watch?t=3915&v=6z_uDm4h-yY
The Water System in Blog Posts:
http://timpeck.blogspot.com/search/label/water%20system
The Regionalization of Public Utilities: An idea whose time has come . . . again.
http://nchouse117.com/water-bill/
MSD Merger Study, March 20, 2013
http://www.msdbc.org/documents/waterstudy/final/FinalMergerStudy032013.pdf
Saturday, April 05, 2014
LTE: Water Merger
Regional authority needed for accountability to users
Dear Editor,
I recently read that Asheville city council is gearing up for another rate increase for water customers in the region (“Asheville considering water rate increases,” March 25, 2014). But some water customers don't live in Asheville. Roughly half of these regional water system customers live in Buncombe County, outside the city. And yet, it is seven people sitting on city council who are in charge of water system policy for the region and they alone are making important decisions which will affect many people who are not their constituents.
If customers outside the city were to have input regarding unreasonable rates, poor service or quality, or matters of future development, where would they turn? They are without representation on Asheville's city council and could not express their point of view by voting in city elections.
To ensure accountability to all water system ratepayers, we need broader representation by a locally-appointed board in a regional authority. It is long past time that these disenfranchised customers outside the city were given a seat at the table and a sure way to voice their concerns to their appointed representative.
TIM PECK
ASHEVILLE
Dear Editor,
I recently read that Asheville city council is gearing up for another rate increase for water customers in the region (“Asheville considering water rate increases,” March 25, 2014). But some water customers don't live in Asheville. Roughly half of these regional water system customers live in Buncombe County, outside the city. And yet, it is seven people sitting on city council who are in charge of water system policy for the region and they alone are making important decisions which will affect many people who are not their constituents.
If customers outside the city were to have input regarding unreasonable rates, poor service or quality, or matters of future development, where would they turn? They are without representation on Asheville's city council and could not express their point of view by voting in city elections.
To ensure accountability to all water system ratepayers, we need broader representation by a locally-appointed board in a regional authority. It is long past time that these disenfranchised customers outside the city were given a seat at the table and a sure way to voice their concerns to their appointed representative.
TIM PECK
ASHEVILLE
Friday, June 21, 2013
Water Lawsuit
Asheville Water Merger Lawsuit
http://www.scribd.com/doc/141477000/Asheville-Complaint
Analysis
The city has filed a rather weak lawsuit against the state and MSD. Buncombe and Henderson counties are, oddly, not named in the suit.
You can read their complaint on my Scribd account.
http://www.scribd.com/doc/141477000/Asheville-Complaint
The key features of the complaint are that the legislation is unconstitutional, that the bond transfer injures the city, and that the corporation of Asheville is a person.
The city contends that HB488 was a local bill and it is unconstitutional to pass legislation in a local bill that affects sanitation. First, the law does not affect sanitation. It changes operational structure only. Second, the legislation is a public bill and would apply to any municipality that meets the conditions set forth. Therefore, it is constitutional.
The city contends that forcing a transfer of bonds to MSD would jeopardize the city's credit standing. The bonds that Asheville "floated" were Revenue Bonds backed, not by taxpayers, but by current and future water system ratepayers. It doesn't matter who holds those bonds, Asheville or MSD, the ratepayers will always be the obligors. Nothing changes with a transfer of ownership. In fact, handing local government bond transfers is what the state treasurer does on a regular basis. They should be done by now.
The city contends that Asheville is a person and must be compensated for a taking. First, a corporation is not a person. Second, the city does not own the water system. Third, a transfer of assets from one government entity to another does not obligate either to any financial reconciliation.
Interview with Attorney Frayda Bluestein, School of Government
WCQS
Asheville water lawsuit.
http://timpeck.blogspot.com/2013/05/water-merger-documents.html#ixzz2VXcMACiO
Ownership is difficult to untangle. But the one thing that is clear is that it's not owned by Asheville. See this report for a breakdown of ownership:
http://www.ncleg.net/documentsites/committees/MetSewWatSysLRC/Report/2012-LRC%20Municipal%20Sewerage%20FINAL%20REPORT.pdf
The water merger is law but is now subject to a temporary restraining order brought by the city. The defendant, the State of North Carolina, asked for the TRO to be extended another 60 days, which was granted by the judge. That is so that the bond transfer matter can be resolved before the case is heard in court. That will blow a big hole right through this lawsuit. The last nail is to ******REDACTED*******. That will completely dispose of the lawsuit to the city's disfavor.
The lawsuit claims that Asheville, the corporation, is a person. And I thought they were against that sort of thing.
Eliminate Corporate Personhood
By Gordon Smith
January 26, 2012
"A resolution calling for a Constitutional Amendment to invalidate the 2010 Supreme Court’s Citizen United decision will be on the February 14th agenda of Asheville City Council"
http://scrutinyhooligans.us/2012/01/26/eliminate-corporate-personhood/
Resolution No. 12-37 - Resolution to Eliminate Corporate Personhood
Asheville City Council
Page 16
"Councilman Smith said that the groups Move to Amend and Asheville Growing Business Alliance asked him to move forward the resolution to eliminate corporate personhood...Councilman Bothwell moved for the adoption of Resolution No. 12-37 to eliminate corporate personhood. This motion was seconded by Councilman Pelly and carried unanimously."
http://www.ashevillenc.gov/Portals/0/city-documents/cityclerk/mayor_and_citycouncil/minutes/mmtwelve/m120214.pdf
http://www.scribd.com/doc/141477000/Asheville-Complaint
Analysis
The city has filed a rather weak lawsuit against the state and MSD. Buncombe and Henderson counties are, oddly, not named in the suit.
You can read their complaint on my Scribd account.
http://www.scribd.com/doc/141477000/Asheville-Complaint
The key features of the complaint are that the legislation is unconstitutional, that the bond transfer injures the city, and that the corporation of Asheville is a person.
The city contends that HB488 was a local bill and it is unconstitutional to pass legislation in a local bill that affects sanitation. First, the law does not affect sanitation. It changes operational structure only. Second, the legislation is a public bill and would apply to any municipality that meets the conditions set forth. Therefore, it is constitutional.
The city contends that forcing a transfer of bonds to MSD would jeopardize the city's credit standing. The bonds that Asheville "floated" were Revenue Bonds backed, not by taxpayers, but by current and future water system ratepayers. It doesn't matter who holds those bonds, Asheville or MSD, the ratepayers will always be the obligors. Nothing changes with a transfer of ownership. In fact, handing local government bond transfers is what the state treasurer does on a regular basis. They should be done by now.
The city contends that Asheville is a person and must be compensated for a taking. First, a corporation is not a person. Second, the city does not own the water system. Third, a transfer of assets from one government entity to another does not obligate either to any financial reconciliation.
Interview with Attorney Frayda Bluestein, School of Government
WCQS
Asheville water lawsuit.
http://timpeck.blogspot.com/2013/05/water-merger-documents.html#ixzz2VXcMACiO
Ownership is difficult to untangle. But the one thing that is clear is that it's not owned by Asheville. See this report for a breakdown of ownership:
http://www.ncleg.net/documentsites/committees/MetSewWatSysLRC/Report/2012-LRC%20Municipal%20Sewerage%20FINAL%20REPORT.pdf
The water merger is law but is now subject to a temporary restraining order brought by the city. The defendant, the State of North Carolina, asked for the TRO to be extended another 60 days, which was granted by the judge. That is so that the bond transfer matter can be resolved before the case is heard in court. That will blow a big hole right through this lawsuit. The last nail is to ******REDACTED*******. That will completely dispose of the lawsuit to the city's disfavor.
The lawsuit claims that Asheville, the corporation, is a person. And I thought they were against that sort of thing.
Eliminate Corporate Personhood
By Gordon Smith
January 26, 2012
"A resolution calling for a Constitutional Amendment to invalidate the 2010 Supreme Court’s Citizen United decision will be on the February 14th agenda of Asheville City Council"
http://scrutinyhooligans.us/2012/01/26/eliminate-corporate-personhood/
Resolution No. 12-37 - Resolution to Eliminate Corporate Personhood
Asheville City Council
Page 16
"Councilman Smith said that the groups Move to Amend and Asheville Growing Business Alliance asked him to move forward the resolution to eliminate corporate personhood...Councilman Bothwell moved for the adoption of Resolution No. 12-37 to eliminate corporate personhood. This motion was seconded by Councilman Pelly and carried unanimously."
http://www.ashevillenc.gov/Portals/0/city-documents/cityclerk/mayor_and_citycouncil/minutes/mmtwelve/m120214.pdf
Saturday, May 11, 2013
Asheville Water System Lawsuit Press Conference
Asheville City Council Press Conference on Water System Lawsuit
Council Chamber, City Hall
May 10, 2013, 11:30am
TERRY BELLAMY: Good morning, everyone. Thank you all so very much for coming out. Good morning. Good morning. Good morning. Thank you all so very much for coming out. Instead of having people sit down, I'm going to ask literally if my council, former mayors, former council members would come, and state legislators would come and stand with me as we start this out. [SPEAKERS ASSEMBLE BEHIND PODIUM] [APPLAUSE] Good morning, everyone. It's a pleasure to bring you all to city council this morning under unfortunate circumstances. It's great to see so many leaders here who have influenced the direction of our community. It's because of the leadership that you have behind me that the City of Asheville has seen unprecedented growth and that we've been able to weather the recession and the many storms our city has faced. I'm really proud that over the years that our representatives here behind me, we can say that the City of Asheville is a beautiful place not only to live and work but also to visit. It's because of the collective policies that were approved by the individual who are standing behind me, we have seen Asheville become one of the best places to live. And farmers have said that we are one of the best places to do business. But more importantly, we have one of the lowest unemployment rates in the state. We've added more jobs from January 2012 to January 2013 percentage-wise than any other city in North Carolina. [APPLAUSE] Yeah, you can clap about that. Because of this group behind us we have unprecedented partnerships we have created as a community. When we think about the vibrancy of Asheville and what makes us a unique community, it's because of the people behind me during the time that they've served, they've worked and they've built bridges, whether it's through the Land of Sky Regional Council, whether it's working with Pack Place, whether it's working with Buncombe County Commissioners, our leaders have committed to working with individuals to make this community better. And they've not only thought about the City of Asheville and the citizens of Asheville, they've thought about the citizens of Buncombe County and the millions of citizens from across this country and the globe who come to Asheville to visit our community. So, today it's troubling when we think about House Bill 488. It forces the loss of the city's water system. Forcing the transfer of Asheville's assets is harmful to our statewide efforts to encourage economic development and business growth. Stability and predictability in terms of municipal assets and agreements are extremely important in terms of how Asheville and North Carolina are viewed as a place to do business. Based upon the opinion of the state treasurer, those factors could impact the bond ratings in North Carolina which may increase the taxpayers cost to borrow funds for critical capital infrastructures. The uncertainties created by this move could also undermine the ability of other cities and towns to issue bonds because they would have to be disclosed to potential lenders in the future, impacting desirability in the bond market. Over the last few months, you've heard this council and myself talk about the issues impacting House Bill 488 impacting our city. I'm not going spend time talking to you about how bad this bill is. Today, I'm going to tell you that we are proud that we put the legal team together of Moore and Van Allen and Long, Park, Warren, Anderson and Payne and our city attorney Bob Oast to help us defend our water system. [APPLAUSE] I'm proud to let you know that we will file a complaint in Wake County Superior Court early next week to help us keep our water system. I'm really proud of the fact that Senator Martin Nesbitt is here standing with us and he's going to speak right now.
Thursday, May 02, 2013
Water Merger Documents
CITY OF ASHEVILLE v. STATE of North Carolina, Buncombe County. August 19, 2008
Legislative Research Committee on Metropolitan Sewerage/Water System
Tim Moffitt: Our Report to the North Carolina General Assembly
Representative Ramsey speaks on HB488
Representative McGrady speaks on HB488
Resolution Supporting Asheville's Retention of Its Water System
Asheville Resolution Against Water Merger
MSD Planning Committee 11-14-12
MSD Planning Committee 11-30-12
MSD Board Meeting, 11/14/12
MSD Board Meeting, 12/12/12
MSD compensation offer to the city.
Compensation offers 1 thru 11: Back to the Future
History of the Asheville Buncombe Water System by Davyne Dial
REFERENDUM
N.C.G.S. § 160A‑321
Sale, lease, or discontinuance of city‑owned enterprise.
(a) A city is authorized to sell or lease as lessor any enterprise that it may own upon any terms and conditions that the council may deem best. However, except as to transfers to another governmental entity pursuant to G.S. 160A‑274 or as provided in subsection (b) of this section, a city‑owned enterprise shall not be sold, leased to another, or discontinued unless the proposal to sell, lease, or discontinue is first submitted to a vote of the people and approved by a majority of those who vote thereon. Voter approval shall not be required for the sale, lease, or discontinuance of airports, off‑street parking systems and facilities, or solid waste collection and disposal systems.
(b) For the sale, lease, or discontinuance of water treatment systems, water distribution systems, or wastewater collection and treatment systems, a city may, but is not required to, submit to its voters the question of whether such sale, lease, or discontinuance shall be undertaken. The referendum is to be conducted pursuant to the general and local laws applicable to special elections in such city.
Bob Oast: Closed session on referendum
"The outcome of the vote on the sale or lease of the water system would only affect the City’s ability to sell or lease the system. It would not affect the City’s ability to seek compensation if the transfer occurs in other ways."
Bob Oast: To city council on referendum
Oast: "The language of the statute limits the voters eligible to participate in such a referendum to City voters. The results of the referendum would be binding such that, if the vote was 'no,'' the system could not be sold or leased."
Bob Oast on sale or lease
Mayor Bellamy asked if we hold a referendum and the citizens say they don’t want the City to sell or lease the water system but the State makes us give it away, do we negate the opportunity to be compensated. She didn’t want to do anything to stop Asheville from being compensated. City Attorney Oast said that the use of sale or lease in the statute contemplates a voluntary transaction. The statute does not address a situation where the City was forced to transfer its assets involuntarily.
LAWSUIT
Pete Kaliner on Water Lawsuit [audio]
Transcript: Asheville Water System Lawsuit Press Conference, verbatim
Water Merger Lawsuit: Temporary Restraining Order
Water Merger Lawsuit: Complaint Filed
Water Merger Lawsuit: Affidavit (Shoaf)
WCQS Interview: Attorney Frayda Bluestein, School of Government, on Asheville water lawsuit.
Legislative Research Committee on Metropolitan Sewerage/Water System
Tim Moffitt: Our Report to the North Carolina General Assembly
Representative Ramsey speaks on HB488
Representative McGrady speaks on HB488
Resolution Supporting Asheville's Retention of Its Water System
Asheville Resolution Against Water Merger
MSD Planning Committee 11-14-12
MSD Planning Committee 11-30-12
MSD Board Meeting, 11/14/12
MSD Board Meeting, 12/12/12
MSD compensation offer to the city.
Compensation offers 1 thru 11: Back to the Future
History of the Asheville Buncombe Water System by Davyne Dial
REFERENDUM
N.C.G.S. § 160A‑321
Sale, lease, or discontinuance of city‑owned enterprise.
(a) A city is authorized to sell or lease as lessor any enterprise that it may own upon any terms and conditions that the council may deem best. However, except as to transfers to another governmental entity pursuant to G.S. 160A‑274 or as provided in subsection (b) of this section, a city‑owned enterprise shall not be sold, leased to another, or discontinued unless the proposal to sell, lease, or discontinue is first submitted to a vote of the people and approved by a majority of those who vote thereon. Voter approval shall not be required for the sale, lease, or discontinuance of airports, off‑street parking systems and facilities, or solid waste collection and disposal systems.
(b) For the sale, lease, or discontinuance of water treatment systems, water distribution systems, or wastewater collection and treatment systems, a city may, but is not required to, submit to its voters the question of whether such sale, lease, or discontinuance shall be undertaken. The referendum is to be conducted pursuant to the general and local laws applicable to special elections in such city.
Bob Oast: Closed session on referendum
"The outcome of the vote on the sale or lease of the water system would only affect the City’s ability to sell or lease the system. It would not affect the City’s ability to seek compensation if the transfer occurs in other ways."
Bob Oast: To city council on referendum
Oast: "The language of the statute limits the voters eligible to participate in such a referendum to City voters. The results of the referendum would be binding such that, if the vote was 'no,'' the system could not be sold or leased."
Bob Oast on sale or lease
Mayor Bellamy asked if we hold a referendum and the citizens say they don’t want the City to sell or lease the water system but the State makes us give it away, do we negate the opportunity to be compensated. She didn’t want to do anything to stop Asheville from being compensated. City Attorney Oast said that the use of sale or lease in the statute contemplates a voluntary transaction. The statute does not address a situation where the City was forced to transfer its assets involuntarily.
LAWSUIT
Pete Kaliner on Water Lawsuit [audio]
Transcript: Asheville Water System Lawsuit Press Conference, verbatim
Water Merger Lawsuit: Temporary Restraining Order
Water Merger Lawsuit: Complaint Filed
Water Merger Lawsuit: Affidavit (Shoaf)
WCQS Interview: Attorney Frayda Bluestein, School of Government, on Asheville water lawsuit.
Sunday, January 13, 2013
LTE: Water Merger
Two takes from readers on city-state relations
Tim Peck | Asheville Citizen-Times | 1/13/2013
House Bill 552, sponsored by Representative Tim Moffitt and signed into law by Governor Perdue on June 28, 2012, directed the City of Asheville to turn over title to certain WNC Ag Center properties. To this date, the city has not complied with this directive and instead contemplates action that would control the conduct of gun shows on those same properties.
In April of 2012, the General Assembly's Legislative Research Committee directed the City of Asheville to effect a merger of their water department with the county's sewerage system into a reorganized, locally-operated regional water authority that would continue the mission of serving water and sewer customers on a wider scale with greater efficiencies and fairer representation. Instead, they have held an irrelevant and insular referendum, passed antagonistic resolutions, voted down reasonable proposals by MSD, conducted propaganda forums and coordinated oppositional activism, all aimed at thwarting the good faith process called for by the committee.
As with the Ag Center, the city has shown every sign of repeating a pattern of stubborn recalcitrance with the water merger and I urge the General Assembly to take full control of this matter and expedite the merger without compensation at its earliest availability.
TIM PECK
ASHEVILLE
RELATED
GREATER ASHEVILLE REGIONAL AIRPORT AUTHORITY ACT.
"SECTION 2.2.(a) The City of Asheville shall convey to the State of North Carolina by warranty or quitclaim deed all its right, title, and interest to the 'City of Asheville Parcel' below, which is part of the Western North Carolina Agricultural Center, and the corporate limits of the City of Asheville are reduced by removing all three parcels below from the corporate limits.."
Tim Peck | Asheville Citizen-Times | 1/13/2013
House Bill 552, sponsored by Representative Tim Moffitt and signed into law by Governor Perdue on June 28, 2012, directed the City of Asheville to turn over title to certain WNC Ag Center properties. To this date, the city has not complied with this directive and instead contemplates action that would control the conduct of gun shows on those same properties.
In April of 2012, the General Assembly's Legislative Research Committee directed the City of Asheville to effect a merger of their water department with the county's sewerage system into a reorganized, locally-operated regional water authority that would continue the mission of serving water and sewer customers on a wider scale with greater efficiencies and fairer representation. Instead, they have held an irrelevant and insular referendum, passed antagonistic resolutions, voted down reasonable proposals by MSD, conducted propaganda forums and coordinated oppositional activism, all aimed at thwarting the good faith process called for by the committee.
As with the Ag Center, the city has shown every sign of repeating a pattern of stubborn recalcitrance with the water merger and I urge the General Assembly to take full control of this matter and expedite the merger without compensation at its earliest availability.
TIM PECK
ASHEVILLE
RELATED
GREATER ASHEVILLE REGIONAL AIRPORT AUTHORITY ACT.
"SECTION 2.2.(a) The City of Asheville shall convey to the State of North Carolina by warranty or quitclaim deed all its right, title, and interest to the 'City of Asheville Parcel' below, which is part of the Western North Carolina Agricultural Center, and the corporate limits of the City of Asheville are reduced by removing all three parcels below from the corporate limits.."
Monday, December 10, 2012
What the Water Study Reveals
Study: Asheville taxpayers lose with water-sewer merger
The Asheville Citizen-Times
AHA. Now we finally have it.
The Claim: the water merger will cost taxpayers because taxes will have to be raised to make up the difference in a loss of revenue to the tune of $33M.
The Truth: The city is prohibited by law from making a profit from the water system. The Sullivan Act mandates that all water system revenue be retained within the system and permits the city to allocate some water system money to improvements ONLY RELATED TO THE WATER SYSTEM. In other words, all money from the water system stays in the water system. It does not go to the city. So, where is the "revenue loss"? That is, unless Asheville has been skimming revenues for unauthorized purposes. This is the only reason the city would feel any loss and thus the need to raise taxes.
Sullivan Act III:
"SECTION 1. The City of Asheville may use up to five percent (5%) of utility revenues for street and sidewalk improvements associated with waterline improvements."
NONSENSE. The city know precisely what the legislature will do. They have directed the city and counties to effect a merger or they will do it for them. That's what they will do. All of this resistance and foot-dragging is not part of the directive.
LRC Recommendation:
"Committee recommends that the 2013 Session of the North Carolina General Assembly consolidate the Public Utility Water System with the Metropolitan Sewerage District of Buncombe County. Should the interested governments craft their own solution for consolidation, which achieves all the objectives of the Committee, before the 2013 North Carolina General Assembly convenes, due consideration would be given to the local plan. Action will not be taken if the parties are engaged in good-faith negotiations on this matter."
Michael Muller:
What all this tells me is that the Asheville City Council has been siphoning millions of dollars a year from the Independent Water Authority to subsidize other expenses not directly related to waterline improvements — as is specifically required by state law. If the city's expenses were, in fact, directly related to waterline improvements and nothing more, there wouldn't be a budget hole.
Instead, City Council has been using the water system as its own cash cow — and milking water ratepayers outside the city with each squeeze. That's how they're able to pay for all these special projects without raising taxes: by overcharging the Independent Water Authority to pad their General Fund. One can only imagine where and to whom all that money has gone over the years. And now, when they're caught with their hands in the cookie jar, they seem to be trying to hiding it with some creative accounting.
This theft would be nothing new. Asheville City Council has been stealing money from the water ratepayers (inside and outside the city limits) and funneling it into its General Fund for years.
In 2007, the Superior Court of Wake County found that “from 1957 through fiscal year 2005, the City of Asheville did not put any funds into the water system. In fact, in addition to the net operating revenue for that period of time of almost $114,000,000.00 (income less expenses), there were a number of payments made from the “water fund” as part of the “operating expenses.” Essentially, the City of Asheville had taken (diverted) so much revenue from the water system to subsidize the City of Asheville’s general fund, the City of Asheville itself was primarily (not solely) at fault for the system disrepair by not having dedicated the water funds for said maintenance and repair." (From the Legislative Research Commission's Metropolitan Sewerage/Water System Committee report to the North Carolina General Assembly. Read it all here: http://nc116.com/?p=1520/#114mm )
Given the shady nature of this operation, opponents of the pending water merger (including those on City Council) have been loathe to admit their true motivations up until now — for good reason, I suspect. A crooked establishment with a vested interest in maintaining the status quo can be very defensive, especially when they have a lot to hide. And they've been nothing if not very defensive.
As blogger Tim Peck has so astutely pointed out on this forum before, these folks have also kept changing the nature of their objections with each passing week: "First, the water merger was declared to be a bad deal because it was just plain ole THEFT. Then it was a bad deal because it was a SEIZURE by a bully. Then it was a bad deal because it might lead to PRIVATIZATION. Then is was a bad deal because it would mean JOB LOSSES for city employees. Then it was a bad deal because it would be COSTLY to ratepayers. Then it was a bad deal because there was NO DEFINED COMPENSATION for the city. Then it was a bad deal because NO DEFINED LEASE OPTION being considered in the studies. Then it was a bad deal because the process is being RUSHED. (Then) it's a bad deal because Henderson County leaders are pushing for undue representation on the regional board as part of a POWER GRAB."
One by one, all of these objections have been shown to be what they are: "straw man" arguments. There is no theft. The merger is an issue of merging one public system with another. There is no seizure. Seizure would imply ownership by the City of Asheville, and the City of Asheville does not "own" the water system — it's merely managed it up until now. It's "owned" by the rate payers (if the City of Asheville "owned" the water system, it could pledge the water system as an asset, which it cannot.) As far as privatization, that has never been part of the argument, as the Citizen-Times itself was forced to admit in an editorial a few weeks ago. The MSD study has shown that there won't be any job losses either — in fact, all the folks will be retained and given raises. Costly? It would save water ratepayers money through consolidation and efficiencies of scale. And as far as future compensation to the city through a lease of the watersheds, that avenue was closed when voters rejected it with November's referendum — a referendum which had the effect of leaving the city with no future leasing option — unless the result of that referendum is reversed, ironically, by an act of the General Assembly itself.
Having painted themselves into a corner, City Council is now forced to implicitly admit their theft. And NOW they're saying that cooperation on the water issue is a good idea — as long as they get to dictate the terms.
Bear in mind that the Asheville City Council doesn't have the greatest track record of trustworthiness in terms of cooperating with its regional partners — after all, they voted as recently in 2004 to unilaterally withdraw from the historic Regional Water Agreement, throwing everyone else under the bus. Also from the LRC's report:
"The agreement was a significant accomplishment. For the first time since the construct of the public water system, water security was enjoyed by the rate-payers in both the incorporated and the unincorporated areas. The de-politicizing of the public water system provided hope that a new era of regional cooperation and economic development synergy would spur smart industrial growth and opportunity for the region. The agreement also recognized that the public water system itself was truly a Public Utility Water System and acknowledged the contribution of non-City of Asheville rate-payers to its history.
Despite that history, in May, 2004, the Asheville City Council voted unanimously to unilaterally terminate the Regional Water Agreement to once again attempt to charge differential water rates, to compel voluntary annexation and to control growth outside of its corporate boundaries."
So here we are. With the possibility of the city charging differential water rates forever out the window and City Council's Forced Annexation powers finally terminated (see http://nc116.com/?p=1594 ), they don't really have much left with which to bully their neighbors out in the county. So, knowing that, the city is playing the only card they have left: they want us to ignore all this uncomfortable history and to look the other way. There's no problem here, they say. Just give them back management of the water system, and trust them.
But I'm guessing, after 50 years, that it just might be too late for all that... creative accounting (and a silly protest by the usual hapless suspects) notwithstanding.
RELATED
Pete Kalilner Show
12/10/21012 | Hour One: Water Merger
The City of Asheville is out with its own study of the state-ordered water system merger.
Resolution Condemning Water Merger
Asheville City Council | 12.11.12
Now, Therefore, Be It Resolved...
LTE: Bothwell, Water
Tim Peck | October 2012
City council member Cecil Bothwell offers us a helpful window into the thinking of local government in his recent commentary.
The Asheville Citizen-Times
“Utility consolidation under MSD could produce cost savings for sewer ratepayers but comes at a cost to the water ratepayers and city taxpayers,” the report states. “Consolidation under MSD reduces costs for sewer ratepayers by $18 million-$23 million over the nine-year period while increasing costs to city taxpayers by $33 million over the same period.”
The merger would increase the city’s property tax rate from the current 42 cents per $100 valuation to 45.7 cents, the study concludes.
The city would lose water revenues that pay for infrastructure improvements like streets and sidewalks that are made in conjunction with waterline projects. In addition, revenues that pay for core functions like administration and information technology would be reduced.
“If the water system is taken from Asheville and given to MSD, there’s all kind of ramifications for the citizens of Asheville just from a financial standpoint,” Councilwoman Esther Manheimer said. “Because of the financial losses the city will experience, the burden of making up that deficit is placed on the taxpayers. Asheville is already on a pretty slim budget.”
“Because of the financial losses the city will experience, the burden of making up that deficit is placed on the taxpayers.”
AHA. Now we finally have it.
The Claim: the water merger will cost taxpayers because taxes will have to be raised to make up the difference in a loss of revenue to the tune of $33M.
The Truth: The city is prohibited by law from making a profit from the water system. The Sullivan Act mandates that all water system revenue be retained within the system and permits the city to allocate some water system money to improvements ONLY RELATED TO THE WATER SYSTEM. In other words, all money from the water system stays in the water system. It does not go to the city. So, where is the "revenue loss"? That is, unless Asheville has been skimming revenues for unauthorized purposes. This is the only reason the city would feel any loss and thus the need to raise taxes.
Sullivan Act III:
"SECTION 1. The City of Asheville may use up to five percent (5%) of utility revenues for street and sidewalk improvements associated with waterline improvements."
“We really don’t know exactly what the legislature will do,” she said.
NONSENSE. The city know precisely what the legislature will do. They have directed the city and counties to effect a merger or they will do it for them. That's what they will do. All of this resistance and foot-dragging is not part of the directive.
LRC Recommendation:
"Committee recommends that the 2013 Session of the North Carolina General Assembly consolidate the Public Utility Water System with the Metropolitan Sewerage District of Buncombe County. Should the interested governments craft their own solution for consolidation, which achieves all the objectives of the Committee, before the 2013 North Carolina General Assembly convenes, due consideration would be given to the local plan. Action will not be taken if the parties are engaged in good-faith negotiations on this matter."
Michael Muller:
What all this tells me is that the Asheville City Council has been siphoning millions of dollars a year from the Independent Water Authority to subsidize other expenses not directly related to waterline improvements — as is specifically required by state law. If the city's expenses were, in fact, directly related to waterline improvements and nothing more, there wouldn't be a budget hole.
Instead, City Council has been using the water system as its own cash cow — and milking water ratepayers outside the city with each squeeze. That's how they're able to pay for all these special projects without raising taxes: by overcharging the Independent Water Authority to pad their General Fund. One can only imagine where and to whom all that money has gone over the years. And now, when they're caught with their hands in the cookie jar, they seem to be trying to hiding it with some creative accounting.
This theft would be nothing new. Asheville City Council has been stealing money from the water ratepayers (inside and outside the city limits) and funneling it into its General Fund for years.
In 2007, the Superior Court of Wake County found that “from 1957 through fiscal year 2005, the City of Asheville did not put any funds into the water system. In fact, in addition to the net operating revenue for that period of time of almost $114,000,000.00 (income less expenses), there were a number of payments made from the “water fund” as part of the “operating expenses.” Essentially, the City of Asheville had taken (diverted) so much revenue from the water system to subsidize the City of Asheville’s general fund, the City of Asheville itself was primarily (not solely) at fault for the system disrepair by not having dedicated the water funds for said maintenance and repair." (From the Legislative Research Commission's Metropolitan Sewerage/Water System Committee report to the North Carolina General Assembly. Read it all here: http://nc116.com/?p=1520/#114mm )
Given the shady nature of this operation, opponents of the pending water merger (including those on City Council) have been loathe to admit their true motivations up until now — for good reason, I suspect. A crooked establishment with a vested interest in maintaining the status quo can be very defensive, especially when they have a lot to hide. And they've been nothing if not very defensive.
As blogger Tim Peck has so astutely pointed out on this forum before, these folks have also kept changing the nature of their objections with each passing week: "First, the water merger was declared to be a bad deal because it was just plain ole THEFT. Then it was a bad deal because it was a SEIZURE by a bully. Then it was a bad deal because it might lead to PRIVATIZATION. Then is was a bad deal because it would mean JOB LOSSES for city employees. Then it was a bad deal because it would be COSTLY to ratepayers. Then it was a bad deal because there was NO DEFINED COMPENSATION for the city. Then it was a bad deal because NO DEFINED LEASE OPTION being considered in the studies. Then it was a bad deal because the process is being RUSHED. (Then) it's a bad deal because Henderson County leaders are pushing for undue representation on the regional board as part of a POWER GRAB."
One by one, all of these objections have been shown to be what they are: "straw man" arguments. There is no theft. The merger is an issue of merging one public system with another. There is no seizure. Seizure would imply ownership by the City of Asheville, and the City of Asheville does not "own" the water system — it's merely managed it up until now. It's "owned" by the rate payers (if the City of Asheville "owned" the water system, it could pledge the water system as an asset, which it cannot.) As far as privatization, that has never been part of the argument, as the Citizen-Times itself was forced to admit in an editorial a few weeks ago. The MSD study has shown that there won't be any job losses either — in fact, all the folks will be retained and given raises. Costly? It would save water ratepayers money through consolidation and efficiencies of scale. And as far as future compensation to the city through a lease of the watersheds, that avenue was closed when voters rejected it with November's referendum — a referendum which had the effect of leaving the city with no future leasing option — unless the result of that referendum is reversed, ironically, by an act of the General Assembly itself.
Having painted themselves into a corner, City Council is now forced to implicitly admit their theft. And NOW they're saying that cooperation on the water issue is a good idea — as long as they get to dictate the terms.
Bear in mind that the Asheville City Council doesn't have the greatest track record of trustworthiness in terms of cooperating with its regional partners — after all, they voted as recently in 2004 to unilaterally withdraw from the historic Regional Water Agreement, throwing everyone else under the bus. Also from the LRC's report:
"The agreement was a significant accomplishment. For the first time since the construct of the public water system, water security was enjoyed by the rate-payers in both the incorporated and the unincorporated areas. The de-politicizing of the public water system provided hope that a new era of regional cooperation and economic development synergy would spur smart industrial growth and opportunity for the region. The agreement also recognized that the public water system itself was truly a Public Utility Water System and acknowledged the contribution of non-City of Asheville rate-payers to its history.
Despite that history, in May, 2004, the Asheville City Council voted unanimously to unilaterally terminate the Regional Water Agreement to once again attempt to charge differential water rates, to compel voluntary annexation and to control growth outside of its corporate boundaries."
So here we are. With the possibility of the city charging differential water rates forever out the window and City Council's Forced Annexation powers finally terminated (see http://nc116.com/?p=1594 ), they don't really have much left with which to bully their neighbors out in the county. So, knowing that, the city is playing the only card they have left: they want us to ignore all this uncomfortable history and to look the other way. There's no problem here, they say. Just give them back management of the water system, and trust them.
But I'm guessing, after 50 years, that it just might be too late for all that... creative accounting (and a silly protest by the usual hapless suspects) notwithstanding.
RELATED
Pete Kalilner Show
12/10/21012 | Hour One: Water Merger
The City of Asheville is out with its own study of the state-ordered water system merger.
Resolution Condemning Water Merger
Asheville City Council | 12.11.12
Now, Therefore, Be It Resolved...
LTE: Bothwell, Water
Tim Peck | October 2012
City council member Cecil Bothwell offers us a helpful window into the thinking of local government in his recent commentary.
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