Waynesville's sewer plant saga riddled with curve balls

May 18—The race to rebuild Waynesville's antiquated sewer plant is more urgent than ever, with the town now under a de facto development moratorium due to a state-ordered cap on new flow coming into the plant.

The saga to rebuild the 1960s-era sewer plant has been beset with hurdles at every turn, chief among them an ongoing battle with state environmental regulators fraught with tension.

The latest monkey wrench came after months of value engineering to lower the construction price was vetoed by state environmental regulators.

"They are putting mandate after mandate on us and it is being borne by every sewer rate payer in Haywood County, except Maggie and Canton," Waynesville Town Manager Rob Hites said.

Three neighboring systems — Clyde, Lake Junaluska and the Junaluska Sanitary District — send their sewage to Waynesville's plant. So they also fall under the moratorium, and also share the cost of rebuilding the plant through customers' monthly sewer bills.

Splitting hairs

While the sewer plant has been near the end of its rope for years, the long road to a rebuild wasn't launched in earnest until five years ago. In the meantime, the town has continued to rack up repeated violations for its discharges into the Pigeon River.

The aging plant's poor performance ultimately led the state to impose a cap on new flow until the rebuild came on line. The clock started ticking in December 2020. Now, a mere 18 months later, the town has hit the cap due to a rash of large-scale housing developments whittling away the allowed capacity.

"It's an effective moratorium," said Hites.

The sewer plant rebuild isn't Hites' first rodeo. He's been around long enough as a town manager that he's gone through the maddening regulatory process before.

But the song and dance with environmental regulators has been particularly tough this time, he said. For starters, Hites disagrees with the capacity cap, claiming it is arbitrary.

"Statistically, they are doing nothing to protect the environment," Hites said. "The fairness side of me says science isn't bearing this out."

Though the town was capped at 155,000 gallons of additional flow, the sewer plant technically has more than 2.5 million gallons of spare capacity. Hoping to stave off the moratorium, the town appealed to the state last month to increase the cap by another 155,000 gallons.

"The additional flow we asked for is less than 0.1% of the capacity that exists at the plant," Hites said.

But the request was denied given the plant's subpar performance and repeated violations. Plus, the sewer plant is overwhelmed during heavy rains when capacity exceeds what it's capable of handling, a major culprit of the violations.

Hites countered that the extra 155,000 gallons of capacity he asked for is a drop in the bucket compared to the additional 3 million gallons that hit the plant during downpours — adding only 0.05% of extra flow.

"That small percentage isn't going to change those violations," Hites said. "If you argue the addition of another 155,000 gallons to the existing flow will have an impact on the performance of the plant, you are arguing against your own statistics."

Reality check

Hites warned of the prospect of a development moratorium almost four years ago after a DEQ inspection of the sewer plant in August 2018 painted a dire picture.

"Treatment components are reaching the end of their life expectancy and are no longer fully operational," the inspection report states. "Facility no longer appears capable of adequately treating incoming wastewater."

DEQ officials gave the town an ultimatum: get going on a new sewer plant or else.

"Now we've got a dog nipping at our heels. That may be a terrible analogy, but that's what it is," Hites said in 2018. "The hammer is over us right now, and if we ignore this there will be a moratorium."

The town staved off a moratorium once back in December 2020. At the time, DEQ officials in the western field office in Asheville wanted to cut off any new flow immediately. But the town appealed to higher ups in Raleigh and secured the additional 155,000 gallons of capacity.

So it's no surprise the same officials in the western field office said 'no' when the town came back and asked for more last month.

"They reminded us they didn't want to give us what we already had," Hites said.

For now, however, the capacity allocations doled out to large-scale housing projects over the past year exist only on paper. Developers haven't even pulled building permits yet, and some are still waiting on land transactions to close or affordable housing grants to come through.

"The challenge is the timing of it," said Elizabeth Teague, Waynesville Development Services Director. "Some developers might not be ready to go until two to three years down the road. And what we hope is our plant will be ready to go by then."

By then, the capacity cap will be a moot point.

Hites keeps coming back to the minuscule volume these projects have in the scheme of things.

"If all these projects come on line, it would have very little if any impact on the plant's performance," Hites said.

Violations

Waynesville has been dinged with 22 violations in the past three years, resulting in $37,000 in fines. The town was chastised once last year for failing to pay fines on a timely basis. The town got a collection letter from DEQ warning that one unpaid fine was "now subject to collection by the Attorney General's office."

Meanwhile, the town hadn't been filing required quarterly reports as mandated under the SOC. It filed only one in March 2021, and hadn't filed one since.

DEQ officials became aware of the lapse following a public records request for the quarterly reports by The Mountaineer. DEQ staff discovered they didn't exist and notified the town of the issue. Town officials said they thought the quarterly status reports were only required once construction had commenced — citing unclear language in the state's order. The town has since recreated the five missing quarterly reports.

Construction delays

While delays are part of major infrastructure projects, time is now of essence since no more development can be permitted until the new sewer plant is on line — which would be summer 2024 at best. The development moratorium doesn't apply to single homes and businesses or lots with existing sewer lines.

After years of planning and engineering, Waynesville finally had a loan in hand to pay for the rebuild and the green light from state regulators to begin construction. But when bids came back in December, the lowest one was $28.5 million — a whopping $9 million more than the town's loan.

It simply wasn't doable, Hites said, citing the exorbitant price increase for steel and concrete as the primary culprit.

After going back to the drawing board, the town shaved $5 million off the price tag with design changes and jumped through hoops to get its loan amount increased to cover the remaining $4 million difference.

But then, another curve ball. DEQ officials rejected the design changes — even though a sister state agency, the Department of Environmental Infrastructure, had approved them.

"We could barely afford to borrow the additional $4 million as it was. But now, DEQ says we have to do the $28.5 million version," Hites said. "In the end, it's the rate payers that would bear the cost."

Teague said it sometimes seems like the state is working against the town rather than with the town.

"We had bid documents, we had a winning contractor, we had it all engineered. The town has spent all this money and time working with the state to fix our plant to their specifications, and if they would work with us, we could get going."

The saving grace could be a grant to help cover the gap thanks to federal COVID stimulus money earmarked for water and sewer infrastructure. North Carolina prioritized its share of funding for so-called distressed communities, and Waynesville wasn't on that list.

The town successfully lobbied to get added to the distressed list, making it eligible for a grant up to $15 million.

The town won't know the grant verdict until June, and in the meantime, costs keep going up. The construction bid will be six months old by then and no longer valid, so it will have to be renegotiated — no doubt for even more, Hites said.