PILOT MOUNTAIN — It’s said that a bird in the hand is worth two in the bush, but is it worth a million in the bush?
The Pilot Mountain Board of Commissioners voted 3-0 (with Commissioner Kim Quinn out of town) to direct Town Manager Michael Boaz to resubmit a sewer project to the state in the hopes of getting a better grant next time.
At Monday’s town meeting, Boaz explained that the town did get a partial funding grant from the N.C. Water Infrastructure Authority for the Sunset Drive sewer project.
An estimate for the work was placed at $2.5 million.
“We had hoped to receive up to 50 percent of the project in grant funding,” Boaz informed the board, “but only received about a 20-percent grant.” That amount comes to $500,000 instead of $1.25 million.
With an interest-free loan over 20 years, the town was looking at paying back $62,500 a year with a 50-percent grant. With a 20-percent grant, that would leave $2 million to pay off in 20 years, which would require $100,000 a year.
Boaz noted that the town already went up $5 a month to customers in order to prepare to pay that $62,500 cost. If the town has to pay $100,000 instead, then customers could see another $5 a month tacked on, he warned.
He explained that at this point, the town had to make a decision pretty quickly because it had to go in one of town directions. If the town were to accept the lower 20-percent grant, then an engineering firm would have to be hired to perform the first engineering report by Dec. 1.
If the town decided to reject that offer and resubmit for the next round of funding, then Boaz said he would need to see what steps he needed to take to make that happen.
Why would the town do any better on the next submission, asked the board members.
According to the Authority, Pilot Mountain took a hit over the size of a sewage pipe, said Boaz. The Authority uses a point system to rank municipalities, and Pilot thought it would score a 66 but ended up with a 62; which supposedly came because of a plan to upgrade a 4-inch force main to a 6-inch line.
The state sees this as an upgrade instead of a necessary maintenance, he said. The town tried to argue that the population in the area has grown a great deal since the first 4-inch force main was installed decades ago, but the state didn’t go along with it.
Boaz said he has it on good authority that if the town resubmitted with a 4-inch spec that the town would get a point size way up around 77, which is extremely high and almost assures the town a 50-percent grant.
Commissioner Gary Bell cautioned that the Authority program is funded by the state, which could always pull funding before there is another grand cycle.
While there is some risk inherit in turning down a sure thing, the funding difference of $750,000 was the deciding factor. Commissioner Evan Cockerham made a motion to resubmit for the grant, and the vote was unanimous.
The commissioners discussed changes to the fee schedule for hooking onto water and sewer services.
Boaz said he knew months ago that the cost of water meters was going up, but he didn’t know exactly how much, so he couldn’t give the board a proper recommendation for the 2017-18 fiscal year.
Because of the meter cost, he recommended raising the tap fee for connecting to a 1-inch water line by $50. Boaz said it is about $1,150 now, so this would make it $1,200.
The town wouldn’t be making any profit off of this amount, he said. In fact, he added, because of a court case a few years ago, cities are not allowed to make a profit off such fees.
The commissioners felt that the change would have been better if it had come with the start of the new fiscal year, but understood Boaz’s dilemma. They voted to make the change.
On a second issue, Boaz suggested adding two fees when someone wants to connect to water and sewer lines on the opposite side of a street.
If a hole has to be bored through the ground under the road, Boaz suggested charging $500 to pay for the $5,000 boring equipment the town had to purchase for such work.
This came on top of a recent expense the town forked out for an outside contractor to come in and perform some boring work to hook eight condos onto the town services. That costs thousands more, Boaz noted.
If any roadwork is damaged by the boring, then a $250 resurfacing fee should be charged.
The developer working on the condos still has six units left to go, so putting in new fees now would be changing his costs mid-stream, said Commissioner Bell. He said he felt uneasy about this, and members of the public in attendance voiced their agreement.
Cockerham said he doesn’t like the way it has shaken out, but he also doesn’t like the idea of the town subsidizing the developer’s costs by paying for these outside contractors to do work the town couldn’t.
Boaz said a compromise to his plan was possible. The town could charge for work it can’t do itself and not charge boring fees for the things it can do — considering that part of the tap fee itself.
The board considered that a reasonable compromise. If the town can’t do the work and hires a contractor, then the developer will pay the contractor fee, the board voted Monday.
Reach Jeff at 415-4692.