“I was astounded,” said Smith, who attended the commissioners’ meeting Monday afternoon.
The sale of the water and sewer system to the village is contingent on a water purchase contract. Smith said the village thought it was a done deal.
“I feel betrayed,” Smith said.
Commission Chairman Micheal Holden said he could not support an agreement that is “drastically different from the original.” He also said he’d like $14 million up front instead of $9 million purchase price agreed upon.
Pinehurst voters approved a $16 million bond issue Nov. 4 based on the $9 million sales price.
Smith said it sounds like Holden wants to go back to square one.
“We don’t want to do that,” Smith said. “It would be wrong. We have a deal. It is too late in the day to restructure the deal.”
Smith said the village would be willing to revert to the original language in the initial agreement with the county regarding the purchase of a million gallons a day for 40 years.
Smith and Pinehurst Village Manager Andy Wilkison said they have not been able to reach Holden to discuss the matter since early October. They said Holden referred them to the county manager and the county’s outside attorneys.
Change in Wording
The sticking point is the wording approved by the Village Council on Nov. 25, which had been worked out over several months and weeks by outside attorneys for both the county and village. Both county and village managers and the attorneys for both sides recommended approval.
Smith released a written statement on behalf of the council saying the contract submitted to the county was “not a departure from that outlined in the Asset Purchase Agreement.” Both sides already agreed to that outline.
“The language (in the revised agreement) was provided by them,” Smith said. “It was their language.”
The water purchase contract is a separate but integral part of the purchase agreement. The commissioners accepted Pinehurst’s original offer to buy a million gallons a day plus pay a 25-cent per thousand gallon wheeling fee to the county.
Pinehurst also agreed to spend $1 million to upsize the water line from the East Moore Water District, to sweeten the deal. Pinehurst also offered and received agreement to build a connector from the East Moore terminus to Pinehurst.
The wording Holden objected to was changed at the suggestion of the county’s own independent attorney, Smith said.
The “wheeling fee” is called an “availability” fee in the amended contract but still adds up to the same amount of profit for the county. By the end of the contract’s term, Pinehurst would have paid the county $3.6 million to reserve up to a million gallons of water a day.
Not Obligated
The amended agreement doesn’t obligate Pinehurst to pay for any of the water not used. That’s called a “take-or-pay” provision. The county has such a provision with Southern Pines and Harnett County, Smith said.
Pinehurst Village Councilman Doug Lapins said the village already needs close to a million gallons a day in the summer to augment its wells.
For years, Pinehurst has relied on the county’s contract with Southern Pines to supply up to 750,000 gallons a day for the village.
The water bond sale is set for Feb. 3. The bonds can be sold on schedule if the dispute over the water purchase contract is resolved early next week, village Finance Director Natalie Dean said. The bonds could be sold any time in the next seven years.
The state Local Government Com-mission won’t allow the bonds to be sold without the water purchase agreement in place, she said.
In its statement, the Village Council said that if the sale falls through, the “county needs to recognize its responsibility to the citizens of Pinehurst and devote the resources necessary to maintain and upgrade the system.”
System Needs Repairs
Smith said the water system is falling further behind in needed new wells and improvements.
The county has deferred spending on it in 2003 since Pinehurst was expected to become the new owner.
“The village will continue to honor its commitment to keep the citizens of Pinehurst and Moore County informed and will look into any other remedies the village has available to ensure the Pinehurst system is managed responsibly, and that sufficient resources are devoted to its operation,” the statement said.
Village Spending Money
Former Moore County Utility Director Dennis Brobst accepted a similar position with Pinehurst to head its utility system Dec. 10. Wilkison said Pinehurst has already spent about $20,000 preparing to take over the system and establish its own utility department.
As for Brobst’s status should the village not acquire the system, the mayor said, “Dennis is an employee of Pinehurst. We are not going to mistreat him,and he’s not going to mistreat us.”
Wilkison said Tuesday that he tried to reach Holden by phone that morning. He left a message for Holden to call him.
Wilkison said Commissioner Colin McKenzie couldn’t provide any insight to Holden’s actions.
Smith said the council and members of the village water committee plan to be available to answer questions and iron out problems when the commissioners have another meeting next week.
“We still anticipate going forward,” Wilkison said. “This needs to be resolved.”
