May 1, 2014

Tega Cay OKs agreement to take over private utility

The Tega Cay City Council voted unanimously Thursday night to take over the troubled, privately owned Tega Cay Water Service utility.

The Tega Cay City Council voted unanimously Thursday night to take over the troubled, privately owned Tega Cay Water Service utility.

The council instructed City Manager Charlie Funderburk to sign a 59-page purchase agreement that outlines city and utility responsibilities for the transfer from private to public ownership.

“It’s just another step going forward to purchase the system,” Mayor George Sheppard said.

The purchase would more than double the number of water and sewer customers the city serves.

Tega Cay Water Service serves about 1,700 Tega Cay homeowners. The city provides water and sewer services to about 1,500 property owners.

On April 8, the council announced Tega Cay Water Service had agreed to sell its system to the city for $5.85 million. The council spent 45 minutes behind closed doors Thursday before voting in open session.

Signing the purchase agreement is similar to putting a house under contract, Sheppard said.

Closing is set for May 30, pending more needed council approvals. Sheppard asked residents for patience, saying not all the problems plaguing the utility – mainly the repeated spillage of hundreds of thousands of gallons of sewage into Lake Wylie – will be fixed immediately.

“We’re going to take ownership of the system, if council votes to do so, on May 30,” Sheppard said. “That does not mean that the entire system will be fixed on the 31st of May.”

Also Thursday, the state Public Service Commission unanimously voted to approve the sale. An April 28 letter to the PSC states the Office of Regulatory Staff has no objection to the transfer.

In approving the sale and transfer, the Public Service Commission waived a hearing and noted no letters of protest had been submitted. The commission now awaits closing on the transaction.

Both city and Tega Cay Water Service officials described the PSC approval as “one more step” toward a final deal.

“That’s definitely one step in the right direction,” said municipal clerk Katie Poulsen.

The state Department of Health and Environmental Control – which issued a consent order against Tega Cay Water Service for environmental infractions following multiple sewage spills into Lake Wylie – also must approve of the sale.

The council will first consider a bond and budget measure to pay for acquiring the system during a special called meeting May 12, with a second vote scheduled for May 19.

If the city takes control of the utility, it won’t immediately become part of city-owned Tega Cay Utilities Department. The two would continue to operate independently for a while, Sheppard said.

“It is probably something we would look to do in the next 10 years or so,” Sheppard said of combining the two systems.

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