Status Report on the Water Utilities for the Town of Woodland
(March 19, 2019)

State Mandate for Water Utilities: The State Water Infrastructure Authority, which was formed in 2013, by the N.C. General Assembly was tasked with assessing and making recommendations about the state's water and wastewater infrastructure needs. A letter, dated March 21, 2017, was sent out to all agencies that operate water and wastewater utilities, explaining the plans for the state to ensure that all individual water utilities are, or are on a path to be viable systems.

To this end, the State Water Infrastructure Authority completed a blueprint entitled “North Carolina's Statewide Water and Wastewater Infrastructure Master Plan: The Road to Viability.” This document is a road map for developing and maintaining viable water and wastewater utilities that safeguard public health, protect the environment, encourage economic development, and support vibrant communities. Simply said, each town and county which operates a water utility is responsible for ensuring that those water utilities are being operated as vibrant and successful businesses, which are self-sufficient. A copy of the letter is attached for your review.

Public Hearing for Water Rate Increase – On August 16, 2018, the Town Board held a public hearing to provide information to the community regarding the need to raise the water rates. The original water rate was $21.00 for up to 3,000 gallons of drinking water consumption and $21.00 for up to 3,000 gallons of sewer water. The monthly total was $42.00. Anything over 3,000 gallons was charged at $.05 per every 1,000 gallons. Woodland had not raised its water rate since 2010.

On October 15, 2018, the Town Board adopted the new water rates.

The new rate for drinking water was set at a base rate of $13.00 for the hook up to the water system. Then charge each customer $3.50 for every 1,000 gallons used.

The new rate for sewer water was set at a base rate of $14.00 for the hook up to the sewer system. Then charge each customer $4.50 for every 1,000 gallons used.

The total base rate for both water and sewer combined will be $27.00. The total each customer will be charged is $8.00 for every 1,000 gallons of water and every 1,000 gallons of sewer water used.

The new rate for out-of-town customers was set at $26.00 and $7.00 for every 1,000 gallons used. The base rate for out-of -town customers is double the rate of in town customers, because they do not pay taxes to the town, but the town is still obligated to maintain those water lines.

On February 7, 2019, the water rates for out-of-town customers was reduced to $26.00 as a base rate and $5.00 for every 1,000 gallons used. The fees were reduced, because the Town Board believed that this newer rate was a more reasonable rate to charge the out-of-town customers.

Revolving Loan for New Well – On October 4, 2016, Woodland was approved to receive a water revolving loan in the amount $663,550.00 from the NC Department of State Treasury, State and Local Government Finance Division and the Local Government Division. The funding request was made by the town, in order to install a new production well for the town's drinking water.

The term of the loan was set at a period of 20 years. One-half of the loan amount ($331,775.00) was determined as “Principal Forgiveness,” which means the Town of Woodland would not be responsible to pay back that amount. Pursuant to the terms of the loan, annual payments in the amount of $16,588.75 were to made in the month of May of each year.

New Well - We have completed a large portion of the project to install a new well on Linden Street (NC Route 35). The well has been drilled and all of the water quality tests have come back as satisfactory. We are now in the process of installing the wellhead, or structure to cover the well. This structure will also house the tank, which will contain the chemicals needed to treat the water. This project is scheduled to be completed by mid-July 2019.

Drilling for the test well project on Linden Avenue commenced in mid-March 2017. According to the contract, it was agreed that expenses would be covered down to a depth of 360 feet. A.C. Shultes, the contractor on the project, did find an aquifer at that depth, but according to geological studies; a larger aquifer, the Cape Fear Aquifer, was located at 420 feet.

Due to the excessive depth involved, the costs of the test drill project was increased by approximately $18,740.00, from $130,242.27, to $148,982.27. This was an alarming concern for the Town Board. Mr. Blaine Humphrey, an engineer from Rivers and Associates and the Project Engineer stated, “Drilling for water is not a precise science and there is no way to know what you are going to find, or where you will find it, until you actually start drilling.” The drilling was completed in mid-May 2017.

As a result of the additional expenses of the drilling project, as well as increased construction costs to install the wellhead, Woodland had to seek additional funding. A request was made to the NC Department of State Treasury, State and Local Government Finance Division and the Local Government Division. The additional loan request was for $121,375. This raised the total amount of funding received from the state to $784,925. The total principal forgiveness remained at $331,775. The new loan amount (with zero percent interest) was increased to $453,150. The annual payments also increased from $16,588.75, to $22,657.50. This represents an annual loan payment increase of $6,068.75.

The second portion of the well project has begun. The construction plans and engineering plans have all been approved. According to the contractual requirements imposed by the State of North Carolina, the entire project must be completed by mid-July, 2019.

Once the well is completed, Well # 1, located on Oak Street, will be permanently closed by a state certified, well abatement contractor. In the meantime, the town is still obligated to take regular water samples from that well for testing purposes. These tests are rather expensive and they add to the overall costs of operating this water utility.

Water Meters – During the Town Board Meeting held on May 3, 2018, Mr. Marshall Lassiter, the town's Officer in Responsible Charge for the water and wastewater system, recommended that we replace the town's water meters due to the following reasons.

We have a total of 259 meters in town. Based on recent assessments, 97 meters registered that over 1 million gallons of water have gone through each of them. According to state standards, any meter that has over 1 million gallons of water, should be replaced. Mr. Lassiter said he would recommend that the meters be replaced at 2 million gallons.

Mr. Lassiter also informed the Town Board that when a meter has experienced over 2 million gallons of water, on average, it becomes between 9%-15% ineffective. That means we were losing between 9% to 15% of our water. The water is passing through the meter, but it is not being registered. That means we are not charging our customers for that 9%-15% of water usage. The water utility was losing money and the town was losing money. The town was still paying the electric bill for the pump required to pump the water through the town, but the town was not being reimbursed. This problem had to fixed.
41 meters in Woodland registered to have had in excess of 2 million gallons of water pass through them. There were 97 meters with over 1 million gallons of water registered.
Since the town needed to consider replacing a significant number of water meters, the Town Board decided to invest in the purchase of auto-read wand meters. They are more expensive than standard meters, but in the long run, they will prove to be very cost effective.
Mr. Lassiter stated that the town uses approximately 36 man hours to read meters each month. With a wand reader, it would take 1 person 4 hours to read all of the meters. The replacement meters cost approximately $75 each. The purchase and installation cost was approximately $60,000. Most, if not all of the new water meters have been installed.

Fire Hydrants – During the Town Board Meeting on May 3, 2018, Mr. Lassiter also informed the Board Members that he and the Public Works Crew recently did an extensive fire hydrant flushing test on all of the hydrants in town. He said there are 15 hydrants that require significant repair, or replacement. He said this is another need for the Town Board to consider. New valves will also need to be purchased for each of those hydrants.

Valves for Underground Water Pipes - If we are able to apply for and obtain a grant to repair our drinking water system, we need to consider not only replacing those 15 hydrants, but also placing new valves (20) at strategic locations throughout town so that we can shut off water at certain locations, without having to shut water off for the entire town, or a large section of town. For example, if there is a water line break on Peach Tree Street, the water would have to be shut off for the entire north side of town. The problem may only affect one, or two homes, but because there are no valves in that neighborhood, the water must be shut off at Main Street. This scenario has played itself out on numerous occasions over the past few years.

Unaccounted For Water – The State of North Carolina requires all water utility organizations to be able to account for all of its drinking water. All but 15 percent of a utility's water is allowed to be considered as “Unaccounted For.”
According to Mr. Lassiter, Woodland is unable to account for 18 percent of its water. This is a serious problem of concern, particularly since the state is paying close attention to this town's wastewater problems.
This “”Unaccounted For” figure would represent leaks in underground pipes, which would obviously lose water. The old, ineffective water meters were another source of water loss. The Woodland Volunteer Fire Department's use of water from the town's hydrants is another source of “Unaccounted For” water, as well as whenever the Public Works Department has to flush the hydrants as part of the maintenance program.

Application for Asset Inventory Assessment Grant for Drinking Water – In the fall of 2018, the Town of Woodland applied for a state grant to receive funding for an Asset Inventory Assessment Project. The grant, if approved, will enable the town to develop an Asset Inventory Management Plan for the drinking water system, as well as a Capital Improvement Plan. The adoption of these plans will help place the town in a more positive position to receive grant funding. The application is pending.

Asset Inventory Assessment Project – On June 2, 2017, Woodland received notification from the state that it was approved for a Wastewater Asset Inventory and Assessment Grant from the Water Infrastructure Fund in the amount of $76,000. Special features of the grant included a 1.5% ($1,140.00) Grant Fee. Additionally, 5% of the grant could be paid through “In Kind” services, such as the cost of labor required to complete the project.
The engineering firm of Rivers and Associates was hired to perform the work. As a result of the grant, two documents were created:

The Asset Inventory Management Plan: The Asset Inventory Management Plan presents a detailed description of the wastewater system and how it is operated.

The Capital Improvement Plan: The Capital Improvement Plan identifies the problem areas of the wastewater system, the estimated cost for repairs and a three-phase program to repair those areas.
The estimated costs of repairs for the wastewater system is $3,282,000.00!!!

Violations Cited for Sewer Overflow – The underground pipes of the town sewer system are in desperate need of repair. There are cracks and breaks in the pipes, as well as in some of our manholes. This allows rain water and debris to enter the pipes and the sewer system, whenever the town experiences heavy rain. This is known as Inflow and Infiltration (I&I).

Due to the excessive amount of surface water (from rain) that enters the sewer system, the system becomes over flooded, which results in sewer overflow. This is a violation of the permit issued by the state, to allow the town to operate the wastewater system. As such, whenever there is a significant amount of sewer overflow, the town must report the incident to the State of North Carolina's Department of Environment and Natural Resources, Division of Water Quality.

As a result of these reports, from 2009 through 2018, the Town of Woodland has been cited by the state for having violated the conditions of its permit on eight occasions. The town was ordered to pay a civil penalty for three of those violations. The total amount of those financial penalties is $4,907.37.

Incident Date(s)                         Estimated Gallons                       Penalty
11/11/2009                                       163,500                             $2,074.48
06/01/2012                                          9,000                              No Penalty
09/08/2014                                          8,395                              No Penalty
11/26/2014                                        15,000                                  $301.13
10/2/2015                                          21,375                              No Penalty
09/32016 – 09/21/2016                   150,000                                $2,531.76
04/24/17 – 06/05/2017                      22,950                               No Penalty
07/24/18 - 08/12/18                             1,850                                 P ending

On January 11, 2019, Woodland received a letter from the State Division of Water Quality. According to the letter, between July 24, 2018 and August 12, 2018, the town's sewer system suffered another series of overflow incidents (6). The town is facing a $25,000 fine. The state has the option of imposing a $25,000 fine for each of those six incidents ($150,00). The Town Board is doing everything it can, in order to convince the state to not impose this financial sanction.

The State of North Carolina has been sending notifications to the town since November 2009, but the town has done very little, with regards to addressing this notorious, overflow problem. State officials believe that Woodland has not been taking the warnings seriously over these past nine years. Woodland is now facing the imposition of a $25,000 fine for each subsequent overflow violation!!!

There is no simple solution that can be used to repair this problem The project will take an enormous amount of funding, estimated at $3,282,000. This number is climbing, because of the increased costs for labor, equipment and materials.

The Public Works Department has made some repairs to strategic areas of the wastewater system, in order to reduce the amount of overflow on the occasion of a heavy rain. As a result, in spite of the amount of rain the town received during the month of February 2019, the town did not suffer any additional overflows.

Community Development Block Grant – On August 27, 2018, a public hearing was held to provide specific information to the community about the town's intentions to apply for the grant, with the assistance of the Upper Coastal Plain Council of Governments.

In October 2018, the Town Board of Commissioners submitted an application for a CDBG in the amount of $2 million, to assist in the repairs of our wastewater system. The money would be used to repair two of our lift stations, which are responsible for pumping wastewater from the town to the wastewater facility treatment plant outside of town. The funds will also be used to repair and replace some of the underground pipes and manholes.

Increase in Wastewater Rates – The Town Board recently received information that state did not award the grant to Woodland. According to Mr. Joe Dooley, a former attorney who currently serves as a consultant for the Upper Coastal Plain Council of Governments, the Town needs to raise the wastewater rate to a level of $58.00 for 5,000 gallons of usage. He stated that the towns that received the grants, were towns that had raised their rates to the level which the state expects to see.

Based on Mr. Dooley's recommendation, the Town Board intends to raise the wastewater rates, so that Woodland will be in a better position to obtain the necessary funding, in the form of grants, from the state. We are hoping to avoid the need to apply for any additional loans for our water system, if possible. If the town is unable to obtain the funding and is unable to make the necessary repairs to the sewer system, the state could impose additional and excessive fines noted above. Woodland cannot financially afford to allow this to occur. The Town Board must do everything within its authority to correct these overflow problems!!!

Clean Water Trust Fund Grant - In April 2019, the Town Board will be making an application for the state's Clean Water Trust Fund, at the recommendation of Mr. Dooley. With the implementation of the new wastewater rates in place, it is hoped that Woodland will receive the funding it so desperately needs, to repair the many problems with the wastewater system.

Please be assured that the Town Board of Woodland is committed to continuing to provide good, dependable and reliable water utility services to the town of Woodland. We are here to serve you.

Respectfully Submitted By: Kenneth W. Manuel, Mayor - Town of Woodland

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Town of Woodland, NC
PO Box 297
123 E Main St., Woodland, NC 27897
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