By Stan Welch
The town councils of Pelzer and West Pelzer met jointly last Thursday night to discuss the possibilities of selling their recently updated sewer systems to ReWa. The meeting was for information only, with no such action considered at the time.
West Pelzer Mayor Blake Sanders reported that discussions with ReWa on the subject have been underway informally for ten months now.
“I have met with ReWa, their lawyers, their accountants and their staff. We have received a letter of intent from ReWa expressing their interest in acquiring our systems, and the two towns’ attorneys are currently reviewing those terms,” Sanders said. “This sort of transfer of assets is a whole new idea, and Mayor McGregor and I felt like it is time to let the public, and our respective town councils to know what is going on.”
The formation of a joint sewer committee comprised of both mayors and both mayors pro tem earlier this year began the process as the two towns explored cooperative efforts to reduce operating costs by combining the towns’ efforts. Shortly after, in a lunch meeting with ReWa officials, the question of a purchase of the sewer systems came up casually.
Sanders said that the two sides subsequently chose a third party to conduct a feasibility study. The Anderson firm DesignSouth was retained to conduct a feasibility study on the acquisition, management and maintenance of all wastewater infrastructure. Aside from the specific information related to that possible purchase, Sanders says the study has already provided a great deal of valuable information, such as the number and location of all the manholes, including when they were replaced, as well as the total footage of the two systems.
Sanders said that there are five goals that the two towns want to see addressed by the sale of the systems, should that prove to be the case. The acquisition by ReWa should assist in growing both towns; it should provide expansion to feasible economic development for both towns; all debt by the towns related to the systems should be totally assumed by ReWa; the towns should be fairly compensated for the sewer system assets; and lastly, sewer rates should remain at or lower than current levels.
The combined costs of the two system upgrades in recent years come to $19.2 million dollars, with a combined debt of $3.75 million dollars. Pelzer has a much larger system, with sixty one thousand linear feet of lines and 441 manholes, while Pelzer has just over thirty six thousand feet of lines and 189 manholes.
The annual debt that would be assumed for each town would amount to approximately ninety thousand per year for Pelzer and approximately sixty thousand annually for West Pelzer. The two goals of maintaining or lowering current rates and receiving fair compensation from ReWa seem to conflict. Sanders said that ReWa officials explained that the more they pay for the systems, the higher the rates go to absorb those costs.
According to projected figures, however, each town would receive cash in the amount of a six figure range, without raising rates.
Sanders said that the jurisdictional lines for such a transaction may cross from state to federal, possibly even requiring federal legislation. “There is no rush on this decision whatsoever. There is a lot of work to be done. We simply felt that it is time to let the public know what is going on and what may occur in the future.”
By Stan Welch