by Casey Mann, Senior Correspondent

The Briar Chapel Community Association announced it had reached an agreement with Newland, the development company that built Briar Chapel, and Old North State Water Company which currently owns and operates the community’s wastewater treatment system.

The agreement outlines several items that the Community Association announcement said was in the “best interests” of both the association and the community while ending the “year-long, costly battle over regionalization of the Briar Chapel wastewater treatment system.”

Residents of the Briar Chapel Community have raised alarms about failures in the sewage treatment system for nearly two years, resulting in raw sewage spills and foul odors for some residents. According to the N.C. Dept. Of Environmental Quality (DEQ), since 2016 the community’s wastewater system has officially logged more than two dozen sewer overflows, sending more than 35,000 gallons of untreated sewage into the community.

At the same time, Old North State Water Company was seeking approval from the N.C. Utilities Commission to connect the Briar Chapel wastewater treatment system to the Fearrington Village wastewater treatment system, which is owned by Fitch Creations, Inc. d/ b/ a/ Fearrington Utilities as a proposed part of a regional solution to wastewater needs in the area. 

During public hearings before the North Carolina Utilities Commission (NCUC) about the request, some residents began collaborating to oppose the proposed connection while demanding improvements to the community’s system. A group of these residents called themselves StopChathamNorth.

The situation seems to have come to a head as Newland is seeking final approval for two final plats in the Briar Chapel community. During the Chatham County Board of Commissioners meeting on Oct. 19, all four groups – the Briar Chapel Community Association, Newland, Old North State Water Company, and Stop Chatham North – were provided the opportunity to present their case to the board.

The next day, the Briar Chapel Community Association announced the agreement between the developer, the system owner and the association. The agreement includes timelines for specific improvements and, in exchange, the community association agreed to support Newland’s final plat approval request. StopChathamNorth was not a party in the agreement.

Highlights of the agreement:

• Within sixty (60) days, restore irrigation to the sports courts and replant trees and shrubs
• Old North State Water Company will install in the next year a bypass line for the current forcemain line that has suffered repetitive breaks over the past few years
• The capacity for the wastewater treatment plant (WWTP) will be increased from 250,000 gallons per day to 500,000 gallons per day to support the final build-out of Briar Chapel
• And both Old North State Water Company and Newland agree to submit bonds to Chatham County, sufficient to cover the costs of these improvement
• Old North State Water Company agrees to withdraw its application with the NCUC to connect with Fearrington within seven days and agrees not to file a similar application in the future

The agreement also creates a “Tri-Party” council of representatives from each of the organizations which will work together to solve wastewater issues as well as others that may affect the community. The council will include representatives of each of the organizations including the caveat that if the wastewater system were to be sold, the new owner would also need to comply with the arrangement.

The announcement by the Briar Chapel Community Association was accompanied by a letter from Hope Derby Carmichael, the attorney for the Briar Chapel Community Association, to the Chatham County Board of Commissioners. The stated purpose of the letter was to “correct any misimpressions” from the Oct. 19 board meeting, calling out StopChathamNorth’s attorney Dwight Allen for “near slanderous statements” and intimations that the community association is in the “hip pocket of the developer.”

The letter outlined the association’s relationship, as representative of the 2,500 current residents, to act “in the best interests” of the community, while not having the authority to file “nuisance claims or other civil damages” on behalf of individual homeowners. And while StopChathamNorth has received the support of about one-quarter of its residents, according to a StopChathamNorth petition, it lacks the legal authority to represent those residents as well. The letter from Carmichael asserts that since the group has never formally organized by filing legal paperwork with the State and/or County stipulating an organizational structure, it was a “movement” rather than an official organization that can legally be a party to an agreement.

The letter goes on to say that while the association was upset about Allen’s “vitriolic attack” against the association and its board members, the association has “consistently praised and thanked” individuals associated with StopChathamNorth, acknowledging not only the success of the group’s advocacy in preventing the connection to the Fearrington system, but for “laying the groundwork” for the creation of the Tri-Party Council.

Liz Rolison of StopChathamNorth said that while there are positives in the agreement, such as the withdrawal from the connection to Fearrington and enforceable timelines for improvements, there was nothing in the agreement about odors from the plant. In addition, there are no restrictions on what other wastewater systems and/or communities that Newland or Old North State Water company may want to add to the system in the future. Rolison also noted that the agreement does not note any resident participation on the Tri-Party counsel.

At its Oct. 19 meeting, the Board of Commissioners decided to table the discussion on Newland’s final plat approval as it awaited documentation of agreements and paperwork as well as the opportunity for the County Attorney to connect with all parties. The discussion was expected to return to the county board of commissioners at its meeting on November 16th.

StopChathamNorth makes its case

Prior to the meeting on the 16th the attorney for StopChathamNorth, Dwight Allen, sent a memorandum to Chatham County and the attorney for NNP-Briar Chapel, LLC (“NNP”), Nick Robinson, outlining its concerns for approving the final plats requested by Newland and its legal assertions for the basis to deny the final plats pending resolutions of outstanding issues regarding service inadequacies with the waste water treatment system servicing the Briar Chapel Community

Allen also stipulated in the memorandum that “StopChathamNorth” is an unaffiliated nonprofit corporation, organized pursuant to Chapter 59A of North Carolina General Statutes. 

Information supplied by StopChathamNorth indicates that it has raised $48,198.68 from 465 families and spent $38,789.27 to date.

The Chatham County Line was unable to verify a filing for “StopChathamNorth” with the Secretary of State’s office, the State Board of Elections, the Chatham County Register of Deeds and/or the Chatham County Board of Elections although it may not be required to do so.

The mission statement for StopChathamNorth is clear that “StopChathamNorth is an unincorporated non-profit association representing concerned homeowners within Briar Chapel.” 

Allen further requested on behalf of StopChathamNorth that the Chatham County Board of Commissioners:

“…deny approval of the two plat plans up for consideration until action has been taken to alleviate the problems identified by the Planning Board in its unanimous decision to deny final approval, because it believed that it was its equitable duty to do so.”

Allen made a number of citations in his letter to county ordinances and related allegations to buttress his case and alleged that “…if Newland is allowed to complete their final plats without fully complying with all County Ordinances, the costs to repair the system will be left to ONSWC and its ratepayers.”

He further stated “That is not a fair or reasonable result. StopChathamNorth has no ill will toward Newland. It does not dispute that Newland has been a good corporate citizen as stated by Tanya Matzen at the October 19, 2020 meeting. However, the accomplishments mentioned are typical of the contributions made by builders of large developments. Certainly, they are of value to the community but are largely motivated by the goal to sell houses and other properties rather than reasons of altruism. That is not a criticism but an observation, and there is nothing wrong with that.” 

Newland responds

To no surprise Nick Robinson, the attorney for NNP-Briar Chapel, LLC (“NNP”) sent a letter back to the County and Dwight Allen addressing his memorandum for StopChathamNorth.

Robinson asserted that “North Carolina law establishes unambiguously that the final plat decision is a non discretionary ministerial approval” and “an applicant’s compliance with established procedures and requirements of the plat approval process renders the applicant entitled to the permit as a matter of law.” 

For Robinson “the bottom line is that all plat approval requirements have been met, and your Planning Staff agrees.” 

Robinson also took issue with the timing of communications from Mr. Allen and the tactics of StopChathamNorth: 

“Despite you (Chatham County) having invited such information from any opponents a month ago, it comes as no surprise that the letter was delivered on the Friday before a Monday hearing on the matter. This has become a pattern in these proceedings. NNP keeps bringing parties together in cooperative, proactive and practical attempts to solve problems. StopChathamNorth seems to keep doing everything in its power to create last minute discord, delay, and confusion. The StopChathamNorth Letter is erroneous on the law as well as misleading and often erroneous on the facts.”

Robinson spent the remainder of his letter laying out his case on behalf of NNP which ended with the statement that “..if Chatham County should deny approval of the Final Plats in contravention of the Subdivision Regulations and the preemption doctrine, NNP will have no option other than to seek redress through the courts and, of course, will seek an award of reasonable attorneys’ fees and costs under N.C.G.S. § 6-21.7 on the basis of Chatham County having exceeded “unambiguous limits on its authority. We have faith and confidence in the Chatham County Board of Commissioners to fulfill its duties and obligations under the law by approving the Final Plats.” 

On November 16th Robinson addressed the County Commissioners and specifically requested the approval of both plats.

He also stated that the parties are in a great position to address the concerns that have been raised due to the Tri-Party agreement that was executed by his client NNP, Old North State and the Briar Chapel HOA and that they should see progress with with the issues regarding Old North State and that financial guarantees are in place to do so.

Finally Robinson asserted that the position of counsel for StopChathamNorth is not with legal merit.

The County attorney weighs in

[Publishers Note: the following comes from the audio and video available online from Chatham County at https://bit.ly/2JcFWva. Subheads are added for organizational purposes.]

County Chair, Karen Howard, then asked the County attorney, Robert Hagemann, for clarification of a few points being made by all parties in particular regarding the regionalization question. Howard felt that the points that had been made in the public input session did not align with the understanding of the Board.

The County attorney, Hagemann, addressed the board regarding regionalization and the legal concept of “preemption” with the goal of separating issues that had become “conflated during this debate”

“I along with the commissioners have heard legitimate concerns about capacity and operational issues about the plant,” said Hagemann “nothing that I will say about the law is intended to minimize or discount the legitimate concerns that have been raised. I will talk about how they can and cannot be addressed by this body and where I believe under state law they will and should be addressed.”

Hagemann went on to advise the board, “Preemption is a legal doctrine–in particular a subset known as field preemption–that occurs when the State of North Carolina has provided by law and regulation a complete and integrated regulatory scheme to the exclusion of local regulation. The doctrine to ensure that local governments do not have ordinances or regulations that conflict with what the state has done in a regulatory context.

The state of course is the sovereign and local governments are not the sovereign.

The doctrine of preemption recognizes that when the state has put in place a regulatory scheme that is designed and intended to occupy the field there is no room for local governments to act in that area. 

Interestingly one of the leading cases in NC regarding preemption is from Chatham County. 

A 2002 case that the State Supreme Court decided Craig vs. Chatham County is a case that struck down local regulations in Chatham County from the board of health and County Commission that attempted to regulate the operation of swine farms. The court recognized that the state of NC had extensive regulation of swine farms and using the doctrine of field preemption struck down the county’s regulations finding them to be in conflict with the state where it had a complete and integrated regulatory scheme.

In the case of wastewater treatment plants and in particular capacity and operational issues such as spills and leaks that result from line breakage and/or odor problems what we find is extensive state regulation through the NC Utility Commission “NCUC” and the North Carolina Department of Environmental Quality (DEQ).

In terms of the issue of wastewater capacity there is clear state law, statutes and regulations that are part of the permitting process for sewer line extensions (and there will need to be sewer line extensions to serve both of these plats) and as part of that regulatory review process. There must be certification by the applicants and the determination by the state that there is sufficient capacity to deal with the additional wastewater generated by the sewer line extension. 

To the extent that the current wastewater treatment plant “WWTP” and spray irrigation fields might be bumping up against capacity (and I do not know that they are) the state has put in place a regulatory scheme to make sure that before the sewer line extension is constructed and before it is connected to the existing system that there is adequate capacity to treat the additional wastewater. Similarly, regarding enforcement or spills resulting from pipe breakage and odor issues the state has regulatory oversight and can and has issued notices of violation(s).

We can disagree with whether the state has been aggressive enough in addressing violations, but ultimately it is the state that gets to make those determinations.

In the context of a plat approval, I understand why concerned residents have raised these issues before the Board of Commissioners, but the decision is whether to approve these final plats.

When discussing preemption in regards to sewer plant capacity and enforcement actions, I am suggesting that for you to bring those matters into your decision making process runs straight into the doctrine of preemption and is subject to challenge. 

If you find, however, that there are deficiencies with the final plat in regard to what is in the ordinance you are well within your right to deny final plat approval.

I am cautioning you to be careful to not allow this conflation of the “WWTP” issues in terms of capacity and compliance (concerns that are very legitimate about the harm that your constituents might be suffering) and be careful and cautious to not bring these into the subdivision plat approval unless we can find a reason based on the ordinance for doing so. If you deny this it is potentially subject to legal challenge. Of course we all recognize that that is not a reason to avoid a principled decision, but we need to be aware of a potential legal challenge.

I also want to address the specific points that the attorney (Dwight Allen) raised on Friday in his letter where he contends that there is a basis within the subdivision ordinance to deny these plat approvals.

Specifically Section 9.3 of the subdivision ordinance, which is the pre-2008 ordinance that is applicable to Briar Chapel, does specifically state that all compact communities, which Briar Chapel is, shall comply with the provisions of the Chatham County compact community ordinance.

The attorney (Allen) argues and suggests the compact community ordinance is incorporated by reference into the subdivision ordinance and therefore the failure to comply with any portion of the compact community ordinance is grounds to deny the final subdivision plats.

Turning to the compact community ordinance what was identified is section 7.2 which deals with wastewater treatment and in particular there is a paragraph that requires the filing for public review of certain documents including as built plans performance reports and data and other materials and it specifically says to do so prior to final plat approvals.

So there is a direct linkage between final plat approvals and that obligation that I think it is worthy of consideration.

I understand why it was raised and my understanding is that planning staff has been encouraging the developer to meet that requirement as recently as this summer and ultimately the attorney (Allen) was not aware of this and maybe some constituents weren’t as well, but Newland did provide a letter with accompanying materials on October 9th that planning staff has determined satisfied that obligation

So to the extent that what was raised on Friday is a subdivision requirement staff believes that this has been met. 

It was stated today by at least one person who spoke at public comment that there is a provision within the compact communities ordinance that states that provisions shall be made for sludge management and odor control that eliminates to the maximum extent possible adverse impacts to the compact communities residents and neighbors.

I have two observations about that provision. The state does regulate odor control so there is at least an argument that the regulation is redundant and may in fact be preempted and more significantly it is not tied to plat approval and to the extent that is an obligation that the county has the authority to enforce it is a continuing and ongoing obligation that unlike the previous issue is not tied to plat approval and apart from preemption concerns I do not believe that it is a basis for you to bring it into your consideration of the plats.

To approve or not to approve–that is the question

Before discussing regionalization I want to lay out what your options are–I see three options:

You can vote tonight to approve the subdivision plats and it is within your power and within your authority.

You can vote tonight to deny the subdivision plats. If you are taking that action I would encourage you to hone in on what particular aspect of the subdivision ordinance that you believe is the basis for denial.

One and two are a vote to approve or a vote to deny.

The third option is well within your rights. The ordinance gives the board of commissioners 60 days from when a final plat is first presented to you to act on that request and acting on that request is voting to approve or deny it and the ordinance says that if the board does not act upon that request within 60 days the plats are deemed approved.

In other words your failure to act to approve or deny within 60 days means that the plat is approved by operation of law. The plats were presented to the board of commissioners on October 19th for the first time and that started running a 60 day clock and the 60 day clock will run out on December 18th. 

Your regular meeting in December is after that date so unless the board holds a special meeting if you choose not to vote tonight before you meet again for business purposes in December that provision by operation of law would result in the approval of the subdivision plat.

Those are your three options.

Chatham County is a bystander with the Tri-Party agreement

To clarify for the benefit of the public you heard back in October that through the Tri-Party agreement, to which the County is not a party and is not an overseer, it is not a county document and is not an agreement that the county can enforce or oversee– but through that agreement as presented and explained to the County, Old North State agreed to and has withdrawn its application to the NCUC to combine the Fearrington system with the Briar Chapel system. 

Two things that I want to make sure everyone is clear on:

The Tri-Party agreement is a document that can be amended at anytime by the parties, so while the agreement is in place– that agreement for Old North State to pull back and promise not to apply in the future for approval from the utilities commission to combine it with Fearrington is enforceable by the other parties if they choose to enforce it.

But it is an agreement that can be amended. It is conceivable that the parties agree to amend it to take out that prohibition.

Second is that commitment is on behalf of only Old North State who is the legal entity that is a party to that agreement and it is not binding on the successors who might own one and/or the other of those two wastewater treatment plants. 

I want to be very clear that is a contractual commitment among those three parties and is not something that the County has the ability to enforce and that there are ways it can be amended and not binding on the successors.

Can the Briar Chapel wastewater treatment plant serve other properties?

If anyone came away with the impression that the Briar Chapel wastewater treatment plant won’t serve additional development outside of Briar Chapel that is incorrect. 

The Briar Chapel wastewater treatment system, if it has capacity, is legally under county regulations and county zoning and consistent with precedent can serve future additional development. 

And to the extent that somebody views that as a regional system they need to understand that. 

As mentioned the system is already treating development outside of the Briar Chapel Development and it’s allowed under the county ordinances that apply to that treatment plant. 

Legally under county regulations and if it has capacity and can get the required approvals from the state it could serve additional development. 

Madam Chair you urged us to clarify those points for the public about it being a regional system.

Questions from the Board of Commissioners:

Chair Karen Howard: “Are there any further questions from this board?”

Vice-Chair Diana Hales: “I must ask about serving future development. Because Briar Chapel was able to serve a couple of their neghboring communities by their footprint to bring them in that allowance opens the door for everything. Am I correct that it is not simply a neighboring property…it could be any property?”

County attorney Hagemann: “ I am very glad that you asked that question. I have made inquiries to lawyers who practice extensively before the utility commission on this issues and what I was led to believe was that the North Carolina Utilities Commission grants a Certificate of Public Convenience and Necessity to private utility providers and those certificates define the geographic area that can be served by one of these utilities. The Briar Chapel wastewater treatment plant has a certificate and there is a defined area in which it can serve. 

There is a relatively simple and easy administrative process to expand the service area to contiguous properties. It still has to be approved by the North Carolina Utilities Commission because it is an amendment to the service area so there is regulatory oversight in order to expand beyond the currently approved certificate of approved area. Any attempt to serve development that is not contiguous requiries a more rigorous process before the North Carolina Utilities Commission including the public hearing process that was underway for the combination of the Fearrington system with Briar Chapel and those changes give an opportunity for interested parties such as we saw with the Fearrington process to appear before the utility commission to intervene and present their case for why it should not be approved.

Under the county zoning and regulation they can serve other areas, but it is still subject to regulatory approval at the state level with particularly the non-contigous properties and notice to those who would want to actively participate.”

Moving forward

After the meeting StopChathamNorth sent out an email where they confirmed that “based on Rule R10-25, ONSWC can submit a notice of contiguous extension to extend their service area to property that is contiguous (property that shares a significant common boundary) with the existing service area.”

Typically such notice is reviewed by the NCUC Public Staff and if no concerns are raised it is sent to the weekly NCUC meetings where they can decide to issue an order approving the contiguous extension.

Given that the mission statement for StopChathamNorth clearly states that “it does NOT support a regional wastewater treatment plant within the residential community of Briar Chapel” and “is opposed to all of these plans to expand Briar Chapel’s WWTP for uses outside of the Briar Chapel residential community” it is likely they will monitor all requests to NCUC public staff and are aware that regionalization is not a dead issue.