Tega Cay votes to buy water utility for $5.85 million

jmarks@fortmilltimes.comApril 8, 2014 

— Tega Cay City Council voted last week to purchase the troubled Tega Cay Water Service system for $5.85 million.

The roughly 20 residents who waited out almost two hours of closed-door negotiations at the April 8 meting erupted into applause following the decision. Now the city has to put together a formal purchase agreement and will need votes to finance the deal, but the process could be complete in the next 15 days, officials said.

“It’s going to be fairly accelerated, to the extent that it can be,” City Manager Charlie Funderburk said.

Both the city and utility have an agreed upon price. Contract matters at closing could change the exact amount the city will pay.

“It’s a definite step,” Councilwoman Dottie Hersey said. “It’s a next step. It’s a big step.”

Rick Durham, president of Tega Cay Water Service, put out a statement on the decision shortly before midnight.

“We are pleased that the City of Tega Cay has passed the resolution to move forward on the purchase of the Tega Cay Water Service system,” he said. “I want to emphasize that it is just the first step, however.”

Durham said his utility is “prepared to do everything necessary to get over the hurdles that remain” to make the transaction happen.

“This is just the first step – but obviously a critical one – and we look forward to moving this ahead and supporting the mayor and the Council in their decision,” Durham said.

The state Department of Health and Environmental Control and Public Service Commission must sign off the on the agreement. Tega Cay Water Service is under a consent order with DHEC for environmental infractions following multiple sewage spills into Lake Wylie. The city would be required to perform mandated work if it takes on the system before improvements are made.

Mayor George Sheppard called the Tega Cay Water issue “probably the most important” one facing City Council.

“We have worked very hard with the city manager and our consultants to make sure that potentially purchasing Tega Cay Water Service was the right thing for all the citizens of Tega Cay,” he said.

A formal presentation was held Monday night in the Glennon Center, where city staff answered questions from the community. Financing and other issues forthcoming, Hersey believes the city has a “solid plan” in place, she said.

“An asset purchase agreement will have to be drafted and approved by Council,” Funderburk said. “There are many more big steps ahead of us, and much more work to be done.”

Information Council used in its decision the past several months will be available at Monday’s meeting. Consultants will take questions. Sheppard wants residents to have as much information on the agreement as possible.

“I know that the idea of a potential purchase is something that is making some residents very nervous, and I understand that,” he said.

City Council met in executive session at 6:30 p.m. April 8. Council opened the public portion of its meeting 117 minutes later. Residents didn’t sit idly by in the meantime.

Dozens came and went during an impromptu town hall discussion led by members of the Tega Cay Water Citizen Advisory Council. Leader Linda Stevenson wasn’t optimistic the Council would announce any decision at the meeting. While there is “no way in the world” she thinks the city should pay the utility’s initial asking price, Stevenson believes something has to be done.

“We want this company out of our lives forever,” she said.

Back in February, the utility said its asking price for the system was $7.86 million.

The citizen group surveyed the more than 1,700 homeowners served by Tega Cay Water Service – about and received 534 replies. About 60 percent, Stevenson said, wanted the city to purchase the system. Legal action against the utility is another option.

“If the city doesn’t buy this,” Stevenson said, “we’re ready to take this company to court.”

The city already serves about 1,500 customers in Tega Cay’s newer sections.

State Rep. Ralph Norman doesn’t “trust any number Utilities Inc. throws out,” he said. Any decision, he told residents during the wait, must come with full knowledge of what the system is worth, what it will take to fix and what residents will have to pay.

“It’s a dilapidated system,” he said. “We all know what it is; we’ve all been to the hearings. I’d want to know those things before anything gets done.”

John Marks •  803-831-8166

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