Tuesday, January 11, 2011

Big Gap Exists Between Stated and Real Purpose of Oconee County Sewer Project

Zoom Bait/St. Mary’s/Gordy Project

The Zoom Bait/St. Mary’s sewer project that Oconee County presented to the state, the federal government and the public is a limited, $383,055 undertaking to provide sewer services to two established businesses in the county with low-to-moderate income employees.

The actual project is a $851,639 infrastructure investment designed to provide sewer services to Zoom Bait and St. Mary’s Health Care System as well to the owners of a 114-acre parcel the county wants to develop as part of its Epps Bridge Parkway commercial complex.

At its Feb. 8 meeting, the Board of Commissioners is scheduled to consider a proposal by representatives of that 114-acre parcel that the owners give the county easements to build the sewer line on their property, but only if the county agrees to reserve 50,000 gallons of sewage treatment capacity for the property for five year.

The representatives also want the county to pay $1,000 in expenses associated with the negotiated settlement.

BOC Chairman Melvin Davis pushed the proposal at the Board’s Jan. 4 meeting, but the other four members of the BOC bulked, saying they had been kept in the dark about the true nature of the project and about the negotiations with the representatives of the 114-acre tract.

News about the value of the project for the owners of the 114-acre parcel first leaked out at the Nov. 2 meeting of the BOC.

What has not been clear until now is the extent to which the county had worked to mask the true nature of the sewer line project in the state and federal grant application.

I filed an open records request with the county on Nov. 15, asking for copies of the grant application the county had made when it sought state and federal support for the project and for related documentation and correspondence.

The application to the Georgia Department of Community Affairs for federal Housing and Urban Development block grant funds, approved by the BOC unanimously on May 26, 2009, is clear in its description of the project.

The county said it was seeking $373,422 in federal funds to provide sewage service to Zoom Bait Company and St. Mary’s Health Care System Highland Hills Village on Jennings Mill Road.

The county said that it expected the total cost of the project to be $383,055, or $9,633 more than it was requesting from the state, and that it would pay that difference from Special Purpose Local Option Sales Tax funds

The county told the state it needed the federal money to keep Zoom Bait from leaving the county and to help St. Mary’s operate within its “financial means.”

The county said Zoom and St. Mary’s together provide jobs for 99 low or moderate income employees and will hire an additional seven low-to-moderate income employees once the sewer service is in place.

The application said Zoom Bait, which manufactures “artificial fishing lures for sportsmen,” has 127 employees, and “78.6 percent of these employees are low-to-moderate income individuals.”

It said St. Mary’s “has committed to work toward hiring 51 percent of their future employees meeting the low-to-moderate income criteria” of the federal government. The St. Mary’s facility includes residential units, a Center for Alzheimer’s and Dementia Care and a hospice house.

Specifically, St. Mary’s anticipates hiring 12 employees, according to the application, with wages ranging from $7.25 per hour for one housekeeper to more than $20 per hour for one licensed practical nurse. The average anticipated wage will be $11.72 per hour, according to the application.

The focus on low and moderate income jobs was advantageous for the federal Economic Development and Employment Incentive Program, from which the county was seeking funding.

The county said in its application that without the federal funding, the “project will not be completed” because Oconee County is using its existing resources for expansion of its Calls Creek sewage treatment plant and for construction of the Hard Labor Creek Reservoir in Walton County.

The application contains a map showing the location of the proposed gravity-flow sewer line and the properties it crosses. It also contains another map showing the contour of the land.

By putting the two maps together, it is possible to see that the proposed line stays just out of the flood plane for McNutt Creek, which forms the border between Clarke and Oconee counties in that area.

BOC Chairman Melvin Davis sent a letter to the Georgia Department of Community Affairs on Aug. 5, 2009, reaffirming that the project was for Zoom Bait and St. Mary’s alone.

Only two properties in the area other than those of Zoom Bait and St. Mary’s are not served by existing sewer lines, Davis wrote.

The two exceptions, which the sewer line actually crosses, are owned by the city of Athens and by the Evelyn and Frank Gordy Family, shown as Varsity Realty, Inc., on the map submitted with the application.

The 14-acre parcel owned by Athens was used in the past as an oxidation pond for sewage treatment for the Kingwood subdivision, according to the application documents. Davis said in his letter that there are “no known development plans” for the parcel.

Davis also wrote that there are “no known development plans submitted to the county” for the 114-acre Gordy property.

The state approved the Oconee County request for the sewer line for Zoom Bait and St. Mary’s on Oct. 5, 2009, but it said it would provide only half the requested money, or $186,711.

The BOC agreed to go ahead with the project on Nov. 24, 2009.

The construction was expected to cost $315,555, based on the preliminary engineering report by Williams & Associates, an Oconee County land planning firm.

In May of 2010, the construction bids came back, and the lowest bid that met the specifications were $327,212 higher than the $315,555 that Williams & Associates had estimated, bringing the total project cost to $710,267.

Davis wrote to the Georgia Department of Community Affairs on May 19, asking it to increase its award from $186,711 to $500,000.

He restated that the project would provide needed sewer services for Zoom Bait and St. Mary’s, resulting in the retention of 127 jobs at Zoom Bait. He also said St. Mary’s would create 12 new full-time positions.

Davis made no mention of the Gordy property.

“With the revelation of the issues associated with the errors in the preliminary engineering report,” Davis wrote, “Oconee County is facing a commitment level of $522,556.22.”

Davis asked the state to increase its funding level to $500,000.

“Commensurately, Oconee County will increase its level of participation in this project to $210,267.22,” Davis wrote.

On June 28, Brian Williamson from the Department of Community Affairs said it would not change the grant because the department’s “management protocols and precedent with regards to similarly positioned grant recipients would prohibit such an increase.”

The BOC agreed at its Aug. 3 meeting to cover the full costs of the project, taking the additional money from SPLOST funds.

The Zoom Bait/St. Mary’s project was on the BOC agenda on Nov. 2 over the objections of Chairman Davis, who argued that the Board had already approved the project.

At that meeting, Davis urged the Board to approve rebidding the project, since the bids received in May of 2010 had expired.

The other four members of the Board objected, however, because St. Mary’s, the Gordy Family and the city of Athens were asking the county to pay for easements to run the proposed sewer line across their property.

At the Jan. 4 meeting, Oconee County Economic Development Director Rusty Haygood and Utility Department Director Chris Thomas reported on their efforts to get the property owners to donate those easements, but the four commissioners were focused on other things.

Commissioner Chuck Horton told Haygood and Thomas “There has been a lack of disclosure” about the true nature of the project.

“I need to know who was meeting and who stands to benefit from a piece of property. I don’t know how much clearer I can make it,” Horton said.

Luke said he agreed with Horton.

“I am embarrassed that I voted for a project I knew so little about in the beginning,” he started.

He added that he had asked specifically at the July 27 meeting if others besides Zoom Bait and St. Mary’s would benefit from the project “and one of the two of you told me no.”

Luke, Horton and Commissioner Margaret Hale all asked Thomas that question at the July 27 meeting.

“This project is specifically designed for those two businesses,” Thomas said, referring to Zoom Bait and St. Mary’s. He said no other customers had been identified.

Thomas also said the properties behind Walmart and Kohl’s, which is where the Gordy property lies, would be served by an existing sewer line. He made no mention of any possible value of the new line to the Gordy property.

Only after the Nov. 2 meeting did Haygood release to me a map showing that the Gordy property lies lower than the existing sewer line, making the proposed new sewer line more suitable.

County Utility Department Director Thomas also reported at that meeting on discussions he and Davis had on July 7 with Atlanta developer Frank Bishop.

According to Thomas, Bishop has an option on the Gordy property.

At the Jan. 4 meeting, Luke said he now has heard that “there have been meetings between representatives of the Gordy property and long before I knew about this project.”

Luke said he wasn’t sure Haygood and Thomas are to blame. “You are staff and you do what you are told,” he said.

“This thing just has not been carried out in a professional manner,” Luke said.

Commissioner John Daniell told Haygood and Thomas “you are seeing a huge change in culture” in the county and the BOC wants more information. “Hopefully everybody is learning that things are different.”

He said staff needs to learn to throw “everything out into the open.”

Commissioner Hale said her big concern was the special deal for the Gordy property owners. The county normally does not reserve sewage capacity for more than a year.

Davis sidestepped the criticism of the four commissioners by recalling the number of times the Board already approved elements of the project.

“It is a worthwhile commercial development project,” he said, “something that would be good for Oconee County long term.”

“Funding is available to handle this without being a budget breaker,” he added.

Horton told Davis he feels he should have been informed about the discussions with Bishop about easements on the Gordy project.

“If the Board is to make a decision about a project, and there is no information that would really affect that decision...now I’m confused...” he said.

Hale challenged Davis.

“Who makes the decision (about) what I need to be able to vote?” She asked. “I’m just saying, everything wasn’t disclosed.”

The specific proposal on the table calls for the county to accept easements from Zoom Bait, St. Mary’s and the Gordy property that would allow the county to put the sewer line on their property without paying for those easements.

The value of the easements was put at $600 in the case of Zoom Bait, $19,640 from St. Mary’s, and $84,910 for the Gordy Property. The county would have to pay the Gordy representatives $1,000.

These figures bring the total cost of the project to $851,639, up from the estimated $773,000 back in July, but the cost to the county would be $559,799, since the easements would be granted without cost (except for the $1,000) and the county is hoping it still hoping to obtain the $186,711 from the state.

Utility Department Director Chris Thomas told the Board that he anticipated generating $967,660 in capacity and other fees from Zoom Bait, St. Mary’s and Gordy’s in the future, so, to his way of thinking, the county actually would be making more than $400,000 from the project.

Nothing was said in the discussion about the easement on the property owned by the city of Athens.

The BOC voted to table the proposal until its Feb. 8 meeting so it can give additional thought to the issue. It also instructed the staff to revisit the easement issue and particularly the offer to reserve sewage capacity for the Gordy property.

The project already is far behind schedule.

According to conditions put forward with the award of the $186,711 by the state, Zoom Bait and St. Mary’s have only until Oct. 5 of this year “to retain and create and document the new jobs” resulting from completion of the sewage project.

Haygood told the Board he thought it possible to get an extension.

While application for the federal funds the county submitted to the state didn’t mention the value of the sewer line to the Gordy property, it did contain a section on citizen input to the decision-making process.

The county advertised in The Oconee Enterprise on May 7, 2009, that it would hold a public hearing about its plans to apply for the grant.

The headline on the 4-inch by 5-inch textual advertisement was simply “Public Hearing Notice.” The meeting was held on May 14, 2009.

Only two persons’ names appear on the sign-in sheet included in the application. Those names were Melvin Davis and Rusty Haygood.

The county dutifully included with the application the minutes of that meeting, which began at 6 p.m. in the Commissioner’s Chamber of the courthouse. Haygood took and signed the minutes.

The minutes begin by noting that Haygood “welcomed those in attendance.”

That would be Davis, whose office is just down the hall from Davis’ in the courthouse and to whom Haygood reports.

Haygood then explained that the county was proposing to build a sewer line “to begin at Zoom Bait, cross Jennings Mill Road, travel across St. Mary’s property, and terminate near Kohl’s department store.”

He also reported that the county intended to seek a grant “to assist low-to-moderate income persons working within Oconee County.”

After his presentation, according to the minutes, Haygood “opened the floor for questions or comments from the public.”

“Davis questioned about the time line for the grant application,” Haygood wrote.

Haygood reported that he told Davis the county anticipated making the application before June 1, 2009.


I was not able to attend the meeting on Jan. 4. Russ Page, a citizen who did attend, shot video for me. I have edited the video to include only the one-hour discussion of the Zoom Bait/St. Mary’s/Gordy sewer line and have uploaded it to the Oconee County Observations Vimeo site.