Three towns in two counties of the Research Triangle Region will be able to begin work on a joint effort to increase water supply to one of the fastest-growing areas of the state now that the Local Government Commission (LGC) gave its seal of approval for more than $368 million to cover project costs.
The LGC approved a request from the Wake County towns of Fuquay-Varina and Holly Springs, and Sanford, in Lee County, about 30 miles away from the other two towns, at its meeting on Tuesday, July 9. The commission has been assisting towns and counties across the state to find ways to merge or otherwise link water and sewer systems.
The Sanford Water Treatment Plant would be expanded to accommodate an additional water flow of 18 million gallons daily and to expand treatment capacity. The project is needed to accommodate present and future growth in the area.
Sanford got the OK for $76 million in revenue bonds and a loan of nearly $88.4 million from the State Revolving Fund to complete the project, which falls under an interlocal agreement among the three municipalities. Fuquay-Varina and Holly Springs received approval to issue $75 million in revenue bonds each, and Fuquay-Varina can now pursue an additional $54 million loan from the State Revolving Fund. The town of Pittsboro (Chatham County) was an original member of the group but has merged its water and sewer system with Sanford.
The LGC is chaired by State Treasurer Dale R. Folwell, CPA, and staffed by the Department of State Treasurer (DST). It has a statutory duty to approve most debt issued by units of local government and public authorities in the state. The commission examines whether the amount of money that units borrow is adequate and reasonable for proposed projects and confirms the governmental units can reasonably afford to repay the debt. It also monitors the financial well-being of more than 1,100 local government units.
Also at the meeting, the commission voted to return financial control to Spring Lake (Cumberland County), population 12,000. The LGC assumed control of the town’s finances in October 2021. The LGC impounded its books and records, assumed control of town finances and all financial affairs, and dedicated state staff to help the local officials correct course. At the time, the town of 12,000 residents was in jeopardy of defaulting on debt service payments. It had obtained a $1 million loan without required LGC approval, and was subject of a state audit at the time that later found more than a half-million dollars in wrongful and questionable spending and missing money, which resulted in a prison term for the former finance director on embezzlement charges.
In other items on the agenda, LGC members considered an application for a combined $228 million in financing for Cabarrus County, however, no member offered a motion for approval so the application did not move forward. Members expressed concern over the type of debt structure to be used, but left the door open to work with county officials to find a better method for funding desired projects.
County officials had sought $186 million in limited obligation bonds related to building a new elementary school, courthouse, library and EMS headquarters. Bond proceeds would have refunded a prior variable rate bond anticipation note with fixed rate financing and paid additional costs for those previous projects. Another $42 million in limited obligation bonds was sought to acquire the former ACN Corporate Headquarters in North Concord to house a new human services facility. Limited obligation bonds do not require voter approval.
The city of Charlotte (Mecklenburg County) was given a green light for $70 million in general obligation bonds to refund an older bond at an interest savings of $4.1 million.
LGC members signed off on a request from the city of Greensboro (Guilford County) to issue $47.5 million in limited obligation bonds. Proceeds will be used to build a new fleet servicing garage, and for improvements to parks and recreation facilities, the Greensboro Science Center, Cultural Arts Center, Heritage House, library, solid waste transfer station, police facility security, streets and lighting. Yard waste collection carts will be replaced. No tax increase is expected.
Lincoln County wants to expand, renovate and equip its jail, and will move forward now that the LGC gave the go-ahead to issue $30 million in limited obligation bonds for the work. No tax increase is anticipated.
The town of Leland (Brunswick County) received LGC consent to a request to obtain $13.5 million in limited obligation bonds to renovate and enlarge the existing Town Hall. Town officials said the project is necessary to add new offices, for HVAC system upgrades, and storage and processing space for police force operations. The LGC had received about 150 public comments about the project, with most voicing opposition.
Rocky Mount (Nash and Edgecombe counties) earned 5-3 approval from LGC members for $11.4 million in financing to construct a two-story fire station on a 1.1-acre lot on Grace Street. It will replace a 46-year-old structure. Mayor Sandy Roberson, City Manager Keith Rogers, Finance Director Krystal Hunter, and representatives of the city’s financial advisor and bond counsel attended the meeting to answer questions about financing for the 16,240-square-foot masonry and steel structure, which will have equipment bays, offices, a day room and kitchen.
Concerns were raised because the city already has committed to $15.5 million in financing to buy land for an unrelated purpose, and that could hamper Rocky Mount’s ability to obtain additional debt for future critical needs.
The town of Garner (Wake County) has a growing workforce, and will enter into a $6.25 million installment purchase to buy and renovate a new Town Hall annex to house its engineering, IT and communications departments. LGC members approved the installment purchase, which allows for payments to be made over time rather than paying all debt up front. No tax increase is anticipated.
Aqua North Carolina, a multi-state company providing drinking water to communities, plans to inventory service lines of unknown composition to classify them as lead, non-lead or galvanized in need of replacement. The work will be done in Cumberland, Hoke, Iredell, Catawba, Gaston, Surry and Warren counties to meet Environmental Protection Agency requirements. The company received a thumbs up from the LGC for the thumbs on a nearly $2.3 million loan from the State Revolving Fund for the work. The company will present a case for a rate increase to the N.C. Utilities Commission.
Valdese (Burke County) received the LGC’s stamp of approval for a $1.48 million loan from the State Revolving Fund to replace pump station piping with larger diameter infrastructure and other upgrades including raising manholes in the 100-year floodplain. The work is needed to reduce infiltration by repairing failing portions of the collection system. The town anticipates a 10% increase in water rates and 30% increase in sewer rates from the current fiscal year through project completion in 2026.
The town of Andrews (Cherokee County) plans to purchase three police vehicles with a $170,000 installment purchase OK’d by LGC members. Town officials say the current vehicles are costly to maintain and replacing them will provide safe, reliable cars for police and adequate public safety for residents.
Several housing authorities received approval for conduit revenue bonds, which allow the authorities to loan the proceeds to a third party. They are:
- Inlivian Housing (Mecklenburg County), $38.5 million, proceeds of which will be loaned to Roers Charlotte Apartments, a Minnesota LLC. Roers will use the money to acquire, build and equip a 238-unit, multifamily rental unit called Linden Village Apartments on Gibbon Road in Charlotte. Low-income households will be targeted for occupancy.
- North Carolina Housing Finance Agency, $16 million for a loan to Partnership Property Management of Greensboro. The money will pay to acquire, rehabilitate and equip about 381 apartment units in 14 rural communities: Chadbourn (Columbus County); Roanoke Rapids (Halifax County); Washington (Beaufort County); Maxton (Robeson and Scotland counties); Hookerton (Greene County); Elizabethtown (Bladen County); Newland (Avery County); Hamlet (Richmond County); Sparta (Alleghany County); Taylorsville (Alexander County); Sylva (Jackson County); Scotland Neck (Halifax County); and Fairmont (Robeson County).
- Durham Housing Authority (Durham County), $7 million, proceeds of which will be loaned to Southside Revitalization Phase IV, a Missouri limited partnership, or one of its affiliates. The money will finance a portion of the acquisition, construction and equipping costs for the Lofts at Southside, a 44-unit, multifamily housing development for rent to low-income households on Memphis Street.