The Moore County Commis-sioners approved the contract Monday night.
The purchase agreement will enable the village to take over ownership of water and sewer utility lines, wells, tanks and towers in the village, currently owned the by Moore County Public Utility Department, and related personal property such as office equipment, amounting to 82.5 percent of the value and the same percentage of inventory.
The percentage splits the difference between the Village Council’s contention that Pinehurst supplies 85 percent of the revenue to the county system and the county’s contention that it’s 80 percent, Mayor Steve Smith explained.
The deal is contingent on Pinehurst voters approving a $16 million general obligation bond issue. The bond referendum is set for Nov. 4, according to Village Finance Director Natalie Dean. That is the same date of the municipal elections.
If voters approve the bond issue, the closing for the purchase is set for March 15, 2004. The state Local Government Commission handles the sale of bonds, which would take place after the referendum. If the voters don’t approve the sale of the bonds, the deal “goes away,” Smith said.
The council met in a closed-door session for more than two hours to discuss the contract that the county commissioners approved the night before.
In the end, there were few material changes from the village’s initial offer to the county to buy the system.
Under one significant change, the Village Council has agreed to pay $400,000 in local matching funds to receive a $400,000 state grant to be used in drilling four new wells for Pinehurst and to increase the size of a line from the East Moore Water District to 12 inches.
The line will connect from the county terminus at McCaskill Road and U.S. 15-501. If the entire grant is not used, the village would get a refund on its matching money.
“We know we’re buying a used car, not a new car,” Smith said. “But we have a major ‘out’ if there is a catastrophic failure or other event between the signing of this contract and the closing.”
Physical damage to the system amounting to more than $1 million could cause the deal to be off.
“I know we have some citizens who don’t think it’s a wise move,” Smith said. “But I want citizens to get out and vote on an informed position. Facts are going to be presented. A newsletter is going out today to Pinehurst residents, and we are running ads.”
The council has scheduled three public information sessions to answer questions and provide facts about the purchase and rates. The first session will be held Wednesday at 2 p.m. in the village Assembly Hall. Sessions will also be held Sept. 30 and Oct. 6, both at 7 p.m., in the Assembly Hall.
The Pinehurst Civic Group is discussing plans to hold a forum or panel discussion before the Nov. 4 referendum, President Joan Thurman said. An announcement will be made about time, place and format.
Updated Information
The village released updated financial data on the sale Tuesday afternoon to an eager audience. The highlights include:
n Pinehurst would pay the cost of water plus a fee to the county for the million gallons it has agreed to purchase daily from the county — not the Vass price, as originally proposed. This gives the county an incentive to keep the price low, Smith explained.
n Pinehurst would build the water line extension beyond the East Moore Water District terminus within three years of the county’s completion of that leg, expected in fall, 2004.
n By agreeing to let water purchased from Harnett or Montgomery counties run through Pinehurst-owned lines to serve Seven Lakes, the village would get credit (not have to pay the full million-gallon rate) for the amount the gated community would use.
“We don’t pay if they can’t deliver 1 million gallons a day,” Smith said during a question-and-answer period. Also, Pinehurst would not be taking over “a single penny” of the county’s long-term debt for its original purchase of the system from the resort, also of Vass and Seven Lakes.
“Pinehurst is paying 90 percent of the debt service for the county,” said Bill Berghorn, a long-time advocate of village system ownership. “We are not taking on a new debt of $12 million, but we’re going to be paying less than we were before [on the old county debt], which is more favorable.”
Two Commissioners Object
On Monday night, the county commissioners voted 3-2 to approve the purchase contract with the village, worked out through painstaking negotiations in recent months by attorneys representing the county and the municipality.
Commissioners Bob Ewing and David Cummings voted against approving the contract. Neither spoke during the meeting. Ewing and Cummings also voted against accepting the village’s purchase offer earlier this year. Their objections were based on concerns about the effect the sale would have on the remaining customers in the county’s water system.
After the meeting, Cummings said his vote reflects that same continuing concern about the effect the sale will have on other county water customers.
“I don’t feel it’s the right thing for our public,” Cummings said. “I don’t think it’s good for our goal of having a countywide water system. I just don’t feel that selling any part of the system is fair to the county.”
Among the changes in the agreement is clarifying language concerning the county’s need to transport water through the Pinehurst system to serve Seven Lakes.
“It recognizes that the county will continue to serve Seven Lakes and that we must continue to move water through Pinehurst to do that,” said Board Chairman Michael R. Holden in his review of the changes in the agreement.
Most of the other changes in the complex 16-page agreement correct typographical or technical errors. The principal provisions included in the original offer from the village remain in the agreement.
These include the understanding that the village will buy at least a million gallons of water daily once an interconnection and connection line are completed enabling transmission of water purchased by the county from the Harnett County system.
This interconnection involves extension and enlargement of lines running from the intersection of Heritage Farm and Union Church roads to the intersection of Farm Life School and Vass-Carthage roads and on to U.S. 15-501 and McCaskill Road.
In the proposal, the village agrees to reimburse the county for incremental costs associated with increasing these lines from eight inches to 12 inches. The water sale provision covers a 40-year period and includes water rates.
The agreement contains the same provisions involving the transfer of equipment and other property included in the previous offer and continues the provision that the village employ personnel presently employed by the county’s Department of Public Utilities.
Further provisions cover interlocal cooperation in connection with water service to Country Club of North Carolina and to the county’s wastewater treatment plant at Addor.
The agreement specifies that the village “has no objection to the buyer (county) dealing directly with the town of Southern Pines concerning acquisition of the CCNC portion of the town of Southern Pines water and sewer systems.” Southern Pines sells water to CCNC, which lies within the village limits
In addition to the water purchase agreement with Harnett County, Moore County buys water from Southern Pines, principally to supplement the Pinehurst system.
The county is nearing completion of work on the East Moore Water District and has initiated plans to develop a similar district for the North West area.
Commissioner Colin McKenzie made the motion to accept the contract, and Commissioner Virginia Saunders made the second. Holden voted with them to approve the contract.
After the vote, McKenzie expressed appreciation for the efforts of the county manager, the county attorney, fellow commissioners and personnel in Pinehurst “for a job well done.” McKenzie, a Pinehurst resident and former village councilman, has long supported the concept of Pinehurst’s ownership of the utilities serving the village.
