City sewer deal could net $1 million

VERGENNES — Although there remains a major contingency, Vergennes aldermen reached a deal on Tuesday that could net the city $1 million plus more in ongoing user fees in exchange for extending a city sewer line two miles north into neighboring Ferrisburgh.
That line, under the terms of a memorandum of understanding with Infill Ferrisburgh Partners LLC, would be capable of handling 100,000 gallons of wastewater a day, an amount that could meet the needs of about 200 homes and businesses. The city would not have to pay any of the cost of building the new line.
The city’s plant is now running at about 60 percent of its 900,000-gallon-a-day capacity, and aldermen who favored the deal — Mayor April Jin, Randy Ouellette, Tracy MacLean and Ziggy Comeau — believe there would be plenty of remaining capacity to handle any foreseeable growth in Vergennes and that the financial benefits are too good to pass up.
“I feel it is a good thing for Vergennes,” Jin said. “We’re bringing a million dollars into our sewer system.”
The deal between aldermen and Infill could allow intensive development of a key open 32-acre parcel near Ferrisburgh’s school and town offices, while also solving existing septic problems along a mile-long stretch of Route 7.
The contingency is that the deal will not take effect unless the town of Ferrisburgh agrees to change zoning for the key parcel in question to allow many times more than the nine homes that are now permitted there. Infill group head William Niquette has had preliminary discussions with Ferrisburgh officials; he says that he would like to create a village-type development there but is not ready to offer details. 
The agreement on sewer extension — something that has been controversial in the past in both communities — includes provisions that will give the city say over the kind of uses its sewer system would support; require Infill to pay all of the $2 million in construction, land purchase, legal and other costs; and require town sewer users to pay 50 percent more in annual fees than city users.
If Infill’s plans are eventually approved in Ferrisburgh, something that may well require an updated town plan as well as amended zoning laws, Vergennes could use the money to stop sewer fees from spiraling higher, catch up with lagging treatment plant maintenance, and perform costly and badly needed septic lagoon cleaning.
“If we can do something to lower the burden on the taxpayers in Vergennes, then it behooves us to do it,” Jin said.
Jin also said that dozens of new homes two miles north of the city would create students for under-populated city schools and customers for city-area businesses.
“This will bring more people into our business sector. They’re building a village, not a downtown,” she said.
Jin also offered an example to illustrate just how much excess capacity the city’s sewer system has.
“Even if we had 1,000 homes added to Vergennes, you’re looking at 200,000 gallons that’s still available for capacity,” she said.
Not all aldermen favored the deal. Alderman David Austin opposed it and refused to attend the executive session on Tuesday in which final details were worked out, while Deputy Mayor Craig Miner and Alderman Mike Sullivan abstained.
Austin said any deal involving sewer extension into a neighboring town should be based on a model Vergennes voters approved in 1994, although that agreement never was put in place because Ferrisburgh voters rejected it.
That agreement called for the town of Ferrisburgh to give Vergennes tax revenue on some of the real estate value that the city sewer extension added to the property it focused on: a still-empty tract at the corner of Routes 7 and 22A. That land is now the proposed site of an Agency of Transportation park-and-ride commuter lot. 
“The issue of sewer extension has been given careful consideration in previous years by previous councils,” Austin said. “This issue was determined to have such importance in 1994 that the question of sewer extension was put to the voters. That document clearly created the framework for any sewer extension.”
Aldermen who supported the deal with Infill said it includes safeguards to protect the city, including provisions that prohibit the line from serving “big box” retail outlets, gas and service stations, and fast food restaurants. Also excluded are dairy processing plants, which can cause problems for sewer treatment.
“We didn’t go into this lightly,” said Ouellette, a member of the council subcommittee that negotiated with Infill. “We put a lot of conditions on it, or this thing couldn’t happen.”
Jin said the final deal included upgrades from the initial offer from Infill, a company that grew out of the effort to rebuild downtown Winooski in the past few years. Niquette oversaw the project for Winooski.
The deal Infill originally proposed offered $400,000 for 40,000 gallons of daily capacity, asked for the right to purchase 60,000 gallons more for another $600,000, and set user fees for Ferrisburgh at 25 percent higher than those within city limits.
The final deal called for the $1 million as soon as Infill has permits for its Ferrisburgh project, set Ferrisburgh user fees at 50 percent higher, and called for city ownership of the new sewer line.
Critically, Jin believes it also gives the city the same kind of security as the 1994 agreement because it will allow the city to take over and sell delinquent properties. 
“It gives us the right that we have in the city, that if people don’t pay their bill, we put their property up for tax sale,” Jin said.
The agreement also said Infill’s sewer allocation “shall be assignable by Infill” within an area bounded to the north by the town fire station, to the south by Little Otter Creek, to the west by the railroad tracks, and to the east by the eastern edges of properties with frontage on Route 7.
In recent meetings in Ferrisburgh about sewer issues, including some focusing on creating a community septic system, town officials have said that many properties have failing or uncertain septic systems.
The town has already spent about $90,000 to buy an easement on the 32-acre parcel to replace the Ferrisburgh Central School’s existing failing system, something mandated by the state, and will spend another $260,000 this year to install the system. It is not likely that the school could postpone that project further.
The memorandum of understanding also calls for the $1 million payment to be made within 180 days of Infill’s final permitting for its project, and states that an “independent professional engineering investigation” confirmed by the city will retain enough sewer capacity “to support growth and development within the city for the foreseeable future.”
Ultimately, Jin said, Ferrisburgh must decide whether it wants to allow intensive development in its village center and whether it wants the potential benefits of municipal sewer there.
Austin, however, said the first prerogative belongs to city voters. Outside of Tuesday’s executive session Austin described the deal as “political suicide” for its backers, and said many citizens will join him in opposing the agreement.
A petition is likely, he said, in part because “there has been absolutely no public discussion” of the wisdom of the deal and whether the city should retain all of its sewer capacity.
“I and a lot of other people feel this thing was railroaded through,” Austin said.
But Jin said she has heard from many citizens who appreciate the deal’s potential financial benefits.
“People are free to petition whatever they want. And then you see what happens,” Jin said.
Austin and local real estate broker Lynn Jackson Donnelly, who also waited outside during the closed-door session, also questioned whether $1 million was enough money for what was being sold. Donnelly said sewer capacity often sells for many times more than in this deal.
Jin said on Wednesday that the deal was fair given Infill’s additional investment of at least $2 million in extending the line.
“You have to look realistically at what you stand to gain,” Jin said. “Could there be a better deal out there? Sure. But this is a good enough deal for us to take it.”
While refusing to attend negotiations Austin also said aldermen may have acted illegally by over-riding the 1994 extension agreement.
“My decision not to participate in the executive session to negotiate the memorandum of understanding with the Infill Partners LLC was based on my belief that this agreement can’t even be considered in light of the 1994 vote,” Austin said on Wednesday. “The action taken by the mayor and the council … demonstrates a lack of respect for city residents regarding this issue.”
Jin said the 1994 agreement was specific to another parcel and that since then the council has twice agreed to extend sewer lines to Ferrisburgh for projects that were subsequently abandoned, once for Country Home Products and once for Specialty Filaments. Both of those projects were proposed for the AOT park-and-ride site.
“I deeply resent David’s suggestion that this is illegal to do,” Jin said.
Ultimately, she said, she will stand by the agreement and its potential benefits.
“This isn’t 1994. Circumstances have changed. We can’t afford to be static. You have to look to the future,” Jin said. “It’s very shortsighted to keep referring back to the past. I believe we’re elected to make decisions.”

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