EXCLUSIVE: Lexington wants to add private utility’s entire nearby network

Lexington town leaders want to acquire the entire water and sewer network near the community from a private utility under fire for polluting the lower Saluda River.

It’s an ambitious goal that would tie more neighborhoods in the Oak Grove area and along the south shore of Lake Murray into municipal service that is regularly improved.

“We have state-of-the art facilities that will be a major upgrade for everyone,” Lexington Mayor Steve MacDougall said. “We provide a product and service that is above grade.”

If accomplished, the effort will add about 3,300 homes and businesses to the 15,000 now served by Lexington.

The move for a complete takeover comes as state environmental officials push Carolina Water Service to hook up its sewage disposal plant in Oak Grove to town facilities that are part of the regional network.

Officials of the private utility are looking to strike a deal with the town as the South Carolina Department of Health and Environmental Control threatens to shut down the company plant for continued pollution.

Environmental groups are upset with sewage spills into a river popular for outdoor recreation.

The town’s takeover plan is “a very welcome surprise,” said State Sen. John Courson, a Richland County Republican who is among lawmakers favoring an end to sewage discharges into the river. “It’s a very big step forward.”

Congaree Riverkeeper Bill Stangler likewise said the takeover would be “another step in continuing to clean up the river.”

Any takeover agreement requires approval from the S.C. State Public Service Commission, whose major concern is the impact on utility bills.

The typical monthly bill for homeowners outside Lexington town limits is about $112 compared with $86 for residents served by Carolina Water Service.

Bills from Lexington are likely to continue rising.

Town leaders are looking at four more years of increases of 2.5 percent annually, recommended to pay for the rising cost of operation, additional facilities to keep pace with growth and tougher environmental protection requirements.

It’s unclear if town officials will have to improve water and sewage lines and other facilities in the two areas targeted for takeover, adding an unknown factor in rate-setting.

Those uncertainties could lead town officials to come up with an alternate plan spreading out costs of acquisition and improvements to ease rate shock in the areas acquired.

Looking at that is premature until Town Hall has a firm idea on what a takeover would cost, MacDougall said.

Higher bills might be what Carolina Water Service customers face in exchange for ending ties with a company they say makes frequent billing errors and responds poorly to calls for help.

“The trade-off might be worth it,” said Ryan Jones of Oak Grove.

Officials at the state agency that represents consumers in utility rate-making are taking a wait-and-see attitude on Lexington’s bid to acquire the two areas.

“Once the deal is known, it’s something for us to review,” said Dukes Scott, executive director of the state Office of Regulatory Staff. The agency makes recommendations to the PSC.

Turning over the two areas to Lexington would still leave Carolina Water Service with about 9,000 customers in the Ballentine area on the north side of Lake Murray as well as others scattered across South Carolina.

Town officials are confident a takeover is affordable, but say it’s too soon to discuss how it would be financed. The main choices are doing it through bond debt or spending savings set aside for other projects.

MacDougall pledged a takeover won’t increase bills of those now receiving town utility service.

“It’s the right thing to do environmentally without a negative impact on current customers,” he said.

Town Hall’s interest in a takeover of the two areas comes as it prepares to close a sewage disposal facility that also has been in trouble with DHEC for spills into a creek that flows into the river.

Adding the two areas won’t strain the town when it comes to sewage disposal, officials say.

Those areas will add about 1 million gallons of sewage to the 3 million gallons now handled daily, well below the 12.5 million capacity designed for continued growth, officials said.