Lexington Jumps Into The Eminent Domain Sewer Again

The Town of Lexington is trying to condemn (acquire through eminent domain) a wastewater facility from the company Blue Granite Water (BGW) (formerly Carolina Water Service).  As one might expect given the subject and the participants, it’s a messy, stinky process with the Town, apparently, using it’s all-too-common practices of executive decision.

Carolina Water Service (CWS) was a crappy – uh – poorly managed – treatment service for a long, long time.  It was repeatedly cited and fined for illegally dumping partially treated wastewater in the Saluda River, causing recreational activities to be halted and a variety of heath and safety concerns.  CWS operated several facilities throughout Lexington and Richland Counties and pretty much became the poster child for lousy management, facility maintenance, incompetence and arrogance.

Last year, not long after the company changed it’s name to Blue Granite Water (BGW), former DHEC Director Catherine Heigel, only six months removed as South Carolina’s top environmental official, became President of BGW

Since Heigel took the helm, BGW has significantly overcome many of the company’s problems and pretty much got it’s sh… stuff together.

But this story isn’t about the wastewater company’s past transgressions or even it’s reconditioned future.  No, it’s about what a town is trying to do to that company in the name of the taxpayer.

Lake and Main has an uncomfortable familiarity with the Town of Lexington and it’s (Mayor Steve MacDougall’s) propensity to acquire property via eminent domain.  L&M is indifferent to eminent domain as a practice because each instance of it’s application must be judged individually.  Some are righteous acquisitions necessary for the common good while others – ain’t.  There are occasions when a municipality is simply making a power grab or, heaven forfend, take property to accommodate a crony’s business interests.  SOMETIMES, there are opportunities to accommodate the TOWN’s business interests to the detriment of private individuals or companies.

The Lexington/BGW tale is long, ugly and boring, so let’s get to the current key issues.

I20 captionedBGW owns a wastewater treatment facility has a wastewater treatment plant off Leaphart Road in Lexington County, near Interstate 20.  Referred to as I-20, the facility services about 2,500 residential customers.

Over the last nearly 20 years, BGW (as CWS) tried numerous times to connect to the Town of Lexington’s larger, more modern system.  The Town repeatedly refused.  At one point, in 1996, the company tried to sell the facility to Lexington, but the Public Service Commission denied the sale because, it ruled, it would not be in the interest of the ratepayer.  That is, the Town would raise rates on residential customers.  This is important.

For the next 13 years, the Public Service Commission denied service contracts between the company and the Town of Lexington because … it would not be in the interest of the ratepayer.

In 2009, Lexington and Cayce made an agreement to issue tax free bonds that would not allow a service agreement with a private company (Carolina Water). To preserve the tax exemption of the Town’s bonds there is “a prohibition on private use of tax exempt bond-financed facilities.

Apparently, according to sources, the Town didn’t tell the company that pretty important detail.  Two years later, in 2011, CWS AGAIN asked the Town of Lexington about making a connection, but the Town reportedly never responded.

2013, yet another entreaty by CWS, but the Town said it can’t accommodate the flow from the company.  NOT that it was restricted by the bonds, just that it can’t handle the volume.  The following year, yet another connection request was rejected.

In July, 2015, the PSC, apparently recognizing that Carolina Water has no options, signaled that it was going to renew the company’s permit to operate the facility.  Members of the General Assembly, responding to loud citizen complaints, let it be known that should that permit be granted, they would take legislative action to counter approval by the PSC.

In September, the Public Service Commission officially denied renewal of  Carolina Water’s permit, teeing up the I-20 facility for takeover.

Now, there is a LOT of technical and bureaucratic constipation … sorry, congestion and backflow in the 20+ year history of this issue and there are pieces and details left out for brevity (I know, “too late!”). 

The Town of Lexington and Blue Granite Walter, nee Carolina Water Services, are going to court as a result of the Town’s condemnation effort.  L&M has been told (unconfirmed) that BGW has put a compensation amount of $13M for the I-20 facility.  The Town countered, also unconfirmed, with $1.6M.  And, finally, HERE is where there seems to be something floating in the pool.

Lake and Main has asked a series of questions of the Town Administrator, Britt Poole, regarding the decision process in these proceedings.  You see, the published Town Council Meeting agendas for the last several years have NO items in which the Council voted to initiate condemnation procedures, reject CWS offers to connect OR buy the I-20 facility.  Nor is there any record of the Council deciding on what amount to offer Blue Granite in the condemnation proceedings.  NONE.

There ARE, however, numerous references to Council discussing “water and sewer” issues in executive session.  Let’s revisit this subject.  According to state law Title 30, Chapter 4 specifies that “Council may not take any vote or action in executive session except to adjourn or to return to public session.”

By whom or how was it decided to pursue eminent domain condemnation of the I-20 wastewater facility ON BEHALF OF THE CITIZENS of the Town of Lexington?  According to published records, not in public session.

I’ve been told that Mr. Poole has been given the authority, by the Council, to negotiate on it’s behalf.  How and when was that decided?  According to published records, not in public session.

By whom or how was the monetary sum ($1.6M?) determined ON BEHALF OF THE CITIZENS of the Town of Lexington?  According to published records, not in public session.

By whom or how was BGW’s offer ($13M?) rejected ON BEHALF OF THE CITIZENS of the Town of Lexington?  According to published records, not in public session.

And let’s not forget that the Public Service Commission had said the Town assuming operation of the facility would be detrimental to ratepayers.  Meaning rates would go up!  How many people along Leaphart Road know that?  How many voted to let that happen? 

Is the Town of Lexington making multi-million dollar decisions out of the public eye?  Such has been the practice of the Council body under Mayor Steve MacDougall.

Is the Town of Lexington, once again, confiscating private property, not for the common good, but for the fiscal benefit of the Town?  Mayor MacDougall does love him some eminent domain.

It will be interesting to see what happens in court when the case comes up.  Often, condemnation cases fall to the favor of the condemned, but I’ve been told that no one at City Hall can recall an instance when the Town of Lexington failed to get it’s way.

More to come.  I’ll light a match and turn on the fan.


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