Local News

Cary-Raleigh fee dispute isn't water under the bridge yet

Posted May 1, 2008 6:04 p.m. EDT
Updated May 1, 2008 9:33 p.m. EDT

— Raleigh leaders want Cary to be neighborly about sharing water from Jordan Lake, but Cary officials say they're not ready yet to call a 6-year-old fee dispute water under the bridge.

City leaders said they approached town officials two months ago about allowing Raleigh to tap into Jordan Lake, Cary's primary water source, during emergencies, including drought-related conditions.

"If we had an emergency, we would ask them for water, and if they determined in their sole discretion that they had no water available, they could sell it to us," Raleigh City Manager Russell Allen said.

An agreement drafted by Cary, though, contains a $1.573 million up-front charge for Cary to make the service available to Raleigh – a fee that Allen said "is absolutely not appropriate in this circumstance."

Cary Town Manager Bill Coleman said the charge is appropriate because it would cover the cost of the increased capacity that Cary would have to sustain to fulfill the agreement.

The $1.5 million fee stems from a contract Cary signed in 1998 to buy water from Raleigh while the town expanded its water treatment plant. The contract was set to expire in 2003.

Coleman said Raleigh leaders insisted Cary managers "get off the (city) system" and "use whatever means necessary ... to finish that plant early." Financial incentives spurred contractors, and they finished the work a year early, Coleman said.

Cary wanted to stop the flow of water into the town and money out, but, Coleman said, Raleigh's city manager told him that Cary "had a contractual obligation that Raleigh relied upon for supplying water" and owed $3 million. They went into mediation, and Cary paid out $1.3 million.

Cary wants to charge Raleigh the same amount, plus six years of interest, that the city charged the town during the drought of 2002, Coleman said.

"I don't believe I would be living up to my responsibility to the citizens of Cary if I agree to sell water under conditions less stringent than they sold water to us," Coleman said.

Allen said the current circumstances are different than when Cary bought water from Raleigh.

Then, Raleigh reserved a specified amount of water for Raleigh. The city, though, has asked Cary only to agree to sell water under certain circumstances that would depend on availability, and an availability fee does not apply, Allen said.

"There is no way I would recommend that (draft agreement) to the City Council," he said.

Coleman said Cary is willing to draft an agreement, without the availability fee, to cover emergencies, such as breakdowns in water treatment or distribution.

A drought is a capacity-demand issue that involves planning and is not an emergency, Coleman said.