Drip, drip: A timeline of the Pittsboro and Sanford water merger


PITTSBORO — The town of Pittsboro’s water infrastructure has been a hot-button issue for commissioners and residents alike. 

Town staff and elected officials are working to develop a plan to merge Pittsboro’s water and wastewater facilities with Sanford’s, which staff argues would help alleviate limitations in the town’s current system. 

The News & Record has created an updated timeline of the merger process between Pittsboro and Sanford. Here’s what’s been reported on so far: 

August 2021: Board of commissioners votes to declare intent to merge with Sanford

During their last meeting of August 2021, Commissioners authorized then Town Manager Chris Kennedy to send a letter of intent to the City of Sanford to merge the two municipalities’ water and sewer capacities.

This move followed two decades of conversations and research between Sanford and Pittsboro seeking solutions to Pittsboro’s inadequate water capacity and treatment capabilities.

Kennedy’s resolution details the discussions and negotiations leading up to the decision, saying it was important to document the 23 years since the town established a moratorium related to limited water capacity.

“What I endeavored upon when I was working on this resolution was when we first formally talked about coordination with the city of Sanford,” he said. “I felt like it would be appropriate and productive to map that out, going back 23 years until April of 1999, and looking at that and saying we have created opportunities for ourselves today to do better to provide water and sewer.”

The proposed Sanford-Pittsboro partnership would allow the two municipalities to “regionalize the public water and wastewater utility systems of the Town of Pittsboro,” which would include water treatment plants, distribution, wastewater treatment and public wastewater collection infrastructure.

During his nearly two-year tenure as town manager, Kennedy said he has prioritized finding a solution to Pittsboro’s decades-long water capacity issues.

“I told the board when I got here I was going to work very hard to provide the town and the community generations’ worth of water and sewer capacity to the best of my ability,” he said. “This is an attempt — this is not a guarantee, Sanford is under no obligation to work with us or take on our water and sewer needs. We feel we have a good partner with them (Sanford).”

August 2022: Town receives first update on status of merger

Kennedy also provided an update on the merger of Pittsboro and Sanford’s wastewater utility systems.

Freese and Nichols Inc. — the consulting engineering firm on the project — has developed a scope of work, which outlines what tasks the firm would be responsible for should a merger take place.

FNI said it would help conduct a study that considers financial options and impacts, system operation, assets and other factors associated with a merger. The firm also said it would carry out a rate analysis and develop a multi-year rate plan for three scenarios: the town only, the town with a merged system and the city with a merged system.

October 2022: Commissioners hear update on force main project

Town Engineer Kent Jackson gave commissioners an update to a project relevant to the Sanford merger in October 2022. 

That September, the Wooten Company, on the town’s behalf, applied for a $10.5 million construction grant from the N.C. Division of Water Infrastructure to supplement the funding for the project. Jackson said he expected to hear back about the grant approval status in January.

“As we anticipate with everything with the bidding climate that the bids may be slightly higher than anticipated,” Jackson said.

Jackson also said that prior to former Town Manager Kennedy’s departure, Kennedy sent a letter to the Local Government Commission and the Division of Water Infrastructure requesting a loan increase request. The request was approved a few weeks later, bringing Pittsboro’s loan approval amount to $26.5 million, Jackson said.

SUBHEAD: Feb. 15: Board votes to move forward and create an interlocal agreement 

Jackson said the town approved staff to start selecting bids for two construction contracts for a wastewater systems improvements project — the Sanford Force Main project. Jackson said the town received two bids in November — one bid for the contract regarding laying down more than 67,000 feet of force main pipes and another for modifications to the town’s wastewater treatment plant.

Once receiving bids, the town entered a 90-day negotiating period with contractors to discuss costs for each of the projects. That period ended on Feb. 8, and Jackson said only one of the two contracts granted a written extension to discuss project costs; the town will have to restart the bidding process for the wastewater plant contract.

Both projects ended up being more costly than town staff originally expected, according to Jackson. The force main project’s estimated cost is around $44 million for the contract, other fees and expenses.

Jackson said he and his staff met with local officials and state representatives to explain the unique situation Pittsboro finds itself in with the funds for the contracts. They’ve also been in contact with Chatham Park Investors, and they’re working to find a way to “fund the gap.”

“Identifying the funding is still a challenge,” Jackson said. “As we stand today, we have $37 million in loans, through the state revolving fund against the $44 million project costs … We’ve made some progress [with Chatham Park Investors], but we have not closed the gap completely yet.”

The board of commissioners came to a consensus, asking Jackson to continue conversations with Chatham Park Investors.

March: Pittsboro receives millions in funds for water infrastructure 

Chatham County municipalities were awarded more than $29 million for infrastructure projects, including $28.4 million for water and wastewater projects in Pittsboro.

For this round of funding, the state’s Department of Environmental Quality (DEQ) received 649 applications from 91 of North Carolina’s 100 counties, and reconsidered applications from spring 2022. In total, 734 applications were considered for funding, representing requests of more than $3.5 billion. The awards are funded by a portion of $2.3 billion from the American Rescue Plan Act, State Revolving Funds (including Bipartisan Infrastructure Law funds), and Community Development Block Grant funding.

Rep. Robert Reives II (D-Dist. 54), who represents Chatham County in the N.C. House of Representatives, said investing in infrastructure projects is a necessity with the incoming development and growth.

“Chatham and Randolph are growing quickly — as fast as any other part of our state,” he said. “With that growth, we need to make investments in our water and sewer infrastructure in order to continue serving both residents and new businesses. I am glad to see this money coming into our communities to ensure clean water is available for every resident, and so that we keep pace with the needs of new industries locating here.”

June 13: Board sets public hearing for interlocal agreement draft

Charles Archer from Freese and Nichols provided a presentation on the work the firm did on the study and analysis on the merger. He talked about phase two of the study, which included a governance group made up of officials and staff from both Pittsboro and Sanford.

“We spent a lot of time talking, and we spent a lot of time outside of the meetings thinking about this,” Archer said. “It’s been a big commitment of time and of folks sharing their knowledge and insight.”

The governance group held four official meetings, according to Archer. Each meeting had a specific topic the group would focus on, including:

  • What a merger with Sanford would look like
  • Capital project financing
  • The merger agreement outline and schedule
  • The official merger agreement draft and schedule

The draft interlocal agreement was made available to the public in the agenda items packet for Monday evening’s meeting. 

Archer broke down the highlights of the merger agreement, which “irrevocably grants Sanford the right to design, construct, operate, maintain and perform all related activities required to operate, maintain, expand, upgrade and improve Pittsboro’s Utility Systems, which includes the right to decommission, sell or otherwise dispose of property in accordance with Sanford’s water, water reclamation and sewer system standards and policies for operation and performance, level of service, reliability and redundancy.”

Sanford will also be the entity responsible for establishing system development fees and water and wastewater utility rates, according to the merger agreement. Both towns would also agree to move forward with “reasonable future growth” for the infrastructure, as well as would provide the same level of service to Pittsboro customers that Sanford customers receive.

Jackson stepped up and went on to explain eight benefits of merging water systems with Sanford. A merger could:

  • Stabilize and reduce a need for rate increases on current or future utility users.
  • Allow capital projects to continue as planned.
  • Provide sustainable water and wastewater infrastructure solutions for the present and the future.
  • Create an eventual rate parity with Sanford.
  • Reduce or eliminate the negative impact on rate payers.
  • Grow the economy of scale and diversify the town’s revenue.
  • Create a beneficial relationship between Sanford and Pittsboro for collaboration on future projects.
  • Leverage future grant funding opportunities.

The board set a public hearing for June 26 to have residents and other members of the public comment on the merger agreement.