PUBLIC
SERVICE COMMISSION
OF
WEST VIRGINIA
CHARLESTON
* *
* * * * * * *
OLD
STANDARD, LLC Case No. 05-0042-S-CN
HEARING: Tuesday, August 9, 2005
9:33 a.m.
LOCATION: PSC Howard M. Cunningham Hearing Room
201 Brooks Street
First Floor
Charleston WV 25323
P R
O C E E D I N G S
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CHAIRMAN MCKINNEY:
Good morning. My name is Jon McKinney. I’m the new Chair
of the Public Service Commission. This
is Ed Staats and Mike Shaw, Commissioners.
It’s interesting, this is my first time to go through this, so I’m
looking forward to hearing this particular case. Case Number 05-0042-S-CN, Old
Standard, LLC, application for a Certificate of Convenience and Necessity to
construct, install, and operate a wastewater treatment facility in Jefferson
County.
We will begin by
taking appearances of the parties and their attorneys. Following appearances, I will ask Counsel
for parties to summarize their positions in this case. When they have finished their summaries, the
Commission will hear from members of the public. There’s a sign-in sheet, and I’ve got a copy of the sign-in
sheet, which is what I will use to call those who wish to speak. If you have not signed yet, please see the
court reporter.
When all of the
public comment has been received, the Commission will begin the evidentiary
hearing of this case. We appreciate all
of you coming here to participate. I
will now take appearances.
ATTORNEY MCDONALD:
Good morning, Your
Honor. Appearing this morning on behalf
of Old Standard, LLC, D. Dandridge McDonald from the firm of Steptoe and
Johnson of Charleston.
ATTORNEY KELSH:
Good morning, Your
Honor. My name is James V. Kelsh,
representing the Jefferson County Public Service District.
MR. FAULKER:
Good morning, Your
Honor, my name is Scot Faulkner. Myself
and my wife, Vicky, are pro se.
ATTORNEY
ROBERTSON:
Good morning,
Chairman, Commissioners, my name is Ron Robertson. I’m here on behalf of the Commission Staff. Thank you.
CHAIRMAN MCKINNEY:
Is there anyone
else today who wants to make an appearance in this case? If that’s all, then we’re ready to proceed
with the public comment portion of today’s hearing. Old Standard, are you ready to proceed with summarizing your
case?
ATTORNEY MCDONALD:
We’re ready to
proceed, Your Honor. Good morning. As I say, my name is Dan McDonald, attorney
for Old Standard.
Your Honor, this
is going to be an interesting case, I think, because it involves a fairly new
concept in the provision of utility service.
We might call it the build-and-donate concept. But this is new to West Virginia. This is one of the first, if not the first projects to embrace
this idea.
Jefferson County
has a critical shortage of wastewater treatment plant capacity. This shortage has virtually stopped growth
in one of the most robust markets in West Virginia. The Sheridan Estates Development, which is located along Route
340 East of Charles Town in Jefferson County is designed for approximately 180
homes. It has been ready to sell houses
for several years, but has been stymied for lack of sewer service. Our evidence will show that many other
developers and projects have been stopped because of lack of sewer.
Old Standard, LLC
is a development company proposing to install a 50,000 gallon per day Membrane
Bio-Reactor wastewater treatment plant on company-owned land, which is an
abandoned quarry in Jefferson County.
There’s a long history of the Sheridan Development’s seeking sewer
system, going back to 2001 and before.
Throughout these
interations we have come now to this new so-called build-and-donate concept,
which we believe will provide a win, win, win situation for everyone. The developers will obtain wastewater
treatment capacity for the subdivision.
The Jefferson County PSD, the public utility in the area will get a
technologically superior wastewater treatment plant and all the mains at no
cost, so that most of the revenues, if not all, it receives from customers will
be incremental. Jefferson County gets
additional wastewater treatment plant capacity which will permit development
not only in the area of the plant, but also around Charles Town, by easing
pressure on the existing Charles Town Wastewater Treatment Plant. And then of course citizens get an
opportunity to buy houses and set up families.
Our evidence will
describe the contracts between Old Standard and JCPSD, the MBR, membrane
bioreactor plant, the cost of operating, its location and its environmental
advantages. PSC Staff has recommended
that this Commission grant a certificate based on two conditions. One, that Old Standard guarantee the
financial feasability for the PSD. And
two, that Old Standard study the option of moving its flows to the Charles Town
treatment plant.
Our evidence will
show that we have met both of these conditions, including the conclusion that
the Charles Town option is not feasible for a number of reasons. After the Commission hears the evidence, we
ask it to issue a Certificate of Convenience and Necessity for the Old Standard
Wastewater Treatment Plant, approve the agreements between Old Standard and
JCPSD, and entertain, after construction of the plant is completed, a petition
from the District and Old Standard to transfer these assets to the District at
no cost. Thank you, sir.
CHAIRMAN MCKINNEY:
Thank you. Jefferson County.
ATTORNEY KELSH:
Good morning. My name is Jim Kelsh, representing the
Jefferson County Public Service District.
The Jefferson County Public Service District currently is only a
collection system, that is it collects wastewater and transmits it to Charles
Town for treatment.
In light of the
rapid expansion of development in the Jefferson County area, the District needs
to move to a decentralized approach to wastewater treatment. That is, it needs to consider and act
appropriate on proposals to construct treatment facilities and rely upon
treatment facilities other than Charles Town Wastewater Treatment Plant.
This project is
actually the first sizable facility which the District is proposing to the
Commission. The District also faces
some difficulty in meeting its duty to serve Jefferson County. The District has some of the highest rates
in the state. Currently for a homeowner
using an average of 4,500 gallons, they will pay, to the District,
approximately $51 per month just for sewer service. On top of that, they will have a water bill.
These high rates
make it difficult for the District to engage in conventional financing for
projects to serve the county. This
project, as Counsel for Old Standard represented, represents a new concept and
a very promising concept to assist with the expansion of wastewater treatment
in Jefferson County. This project will
serve not only the Sheridan Development, but has the potential to assist the
District in meeting its wastewater treatment demand needs in other places of
the county.
The Commission has
issued an order on July --- I’m sorry, I’m not sure of the date of the
order. But anyway, the Commission asked
the parties to identify witnesses. And in response to that, the four parties
have identified a total of 26 witnesses.
I’ve been in practice before the Commission for five years and I can’t
say that I’ve ever been involved in a case in which the Commission took the
testimony of 26 witnesses, and that includes two major rate cases for the West
Virginia American Water Company.
The number of
witnesses may lead you to suspect that this is a very complicated case. I beg to differ. This case involves essentially the difficult decision of ruling
upon a 100 percent grant-funded certificate project for a wastewater treatment
plant which will produce the highest quality effluent in Jefferson County and
the highest quality effluent ever in the state.
This project
offers an enormous benefit to the District.
Not only will the developer donate all the capital facilities, but the
developer will guarantee that the District will at least break even on operational
costs. It is expected that once growth
emerges, that the District will do better than break even on this project, and
that should assist its financial position.
This is a win-win
proposition. The District fully
supports Old Standard’s application and looks forward to operating the Old
Standard facility.
Despite the
obvious and strong benefits of the project, the interveners, the Faulkners, and
the Staff Commission suggests that perhaps it might be better to transmit
wastewater to Charles Town. That is an
unfavorable alternative for several reasons.
One is the tremendous uncertainty associated with relying upon the
Charles Town Wastewater Treatment Plant.
The District is effectively is in a moratorium currently. Construction is under way for expansion to
that facility. However, the list of
folks who are going to use the capacity created by that expansion is quite long
and it’s expected that that new capacity will be consumed quite quickly. The plant’s further capacity are rather
vague. In any event, it is unlikely
that should Old Standard construct the facilities that Staff suggests to
connect to the Charles Town wastewater plant, it is unlikely that the District
will be able to obtain capacity at that plant.
For these reasons, the Charles Town alternative is clearly an inferior
solution.
The District
strongly urges the Commission to grant Old Standard a Certificate for this
project. Thank you.
CHAIRMAN MCKINNEY:
The Faulkners.
MR. FAULKNER:
Good morning, Mr.
Chairman. This is a complex case, not a
simple case. And there are three
numbers that you need to keep in mind as you hear all this testimony. These are 178, 270 and 1,250. 178 is the number of homes currently
permitted for Sheridan Subdivision, the main purpose for this Old Standard
sewer. 270 is what your own Staff say
is the break-even mark for this plant to be economically viable. 1,250 is the permits granted by the --- the
number of units granted by the Department of Health from the West Virginia
state government that says that for everything to work, the pumps, the pipes,
the plant, they need this amount for the top of the line permit.
We’re going to be
going over these three numbers and showing that, number one, this plant will
never be economically viable. And
number two, this plant will never be technologically viable. And so these three numbers you all three
need to be considering because these will become very important as the day
continues.
Another component
of today’s discussion is, you have the plant in Charles Town that is currently
being built and has been allowed to go forward. You have plants before this Commission at Bellair, and this plant
on the books being --- coming before this Commission from the PSD itself at
Flowing Springs. Flowing Springs is
right across the street from Sheridan, not two and a half miles away. Bellair is a half a mile from Sheridan, not two
and a half miles away.
You must ask
yourself, why, with Charles Town plant being expanded and the original pipe for
Sheridan, which Sheridan was actually approved on
---. I mean, you have to understand, for the last
three years the developers of the Sheridan Subdivision have put forth official
documents to the state government, to the county government and represented in
every public hearing before the Planning Commission in Jefferson County that
they would be served by the Charles Town plant. They received building permits based upon that, so the Sheridan
Subdivision has proceeded forward. They
have sold houses, they have excavated the land, they have laid pipe. They have received every possible approval
from the county government of Jefferson County without Old Standard even being
whispered. So therefore, when they say
that Old Standard needs to be built so Sheridan can be built, one has to
question that logic.
So where is Old
Standard being built? Two and a half
miles away, in the middle of a
rurally-zoned area and surrounded by Harpers Ferry National Historical
Park. Tourism is the second largest
industry in the state, the fastest growing industry in the state, and currently
represents close to 22 percent of the entire employment base in Jefferson
County. So to put a plant which on the
surface seems to be designed to stimulate intense residential growth in the
very area that is the main tourist gateway to the eastern part of the state,
where 22 percent of our employment base is based on, one needs to weigh that as
to, is this truly a public convenience.
And we will be going through that in detail.
But the key is,
remember the numbers. Is this
financially viable? Can it ever be
financially viable? And secondly, can
it be technologically viable, because there are not enough homes and there will
never be enough homes to make either of these numbers work. Thank you.
ATTORNEY
ROBERTSON:
Chairman,
Commissioners, basically what Staff had did in this approach, in looking at the
Old Standard certificate, Staff’s major focus is looking at both orderly and
also the timeliness in this particular application. And just to give you a little bit of a background. In the Charles Town immediate area there are
three current sewer treatment plants, one at Tuscawilla, one at the City of
Charles Town, and also one at Willow Springs.
And primarily what the Staff is going to be focusing on at a treatment
project at the City of Charles Town.
Currently, they do have a project that’s being upgraded to 500,000
gallons of capacity to expand, to give extra capacity.
Also, the Staff
will present testimony looking at Ranson, the City of Ranson, which is
currently building a flow station, constructing a flow station to accept
additional flows, and one the Staff has proposed as its first recommendation
for orderly and also timeliness of development as having the Sheridan
Development to be 178 lots, actually to go back in and to tie into the
Breckenridge Pump Station. The
Breckinridge Pump Station will tie to this Flowing Springs Pump Station, then
it would feed to the City of Charles Town.
Looking at those
particular things that Staff looked at, for an orderly and timeliness of
development with the developer to serve the residential subdivision and also to
provide with the District an orderly development of the District’s infrastructure,
since this particular project was going to be looking at conveying over to the
District.
As an alternative,
the Staff has also looked at the Old Standard plant itself. And that would be I’ll say the Staff’s
second preference as a recommendation.
And that would be looking at the Old Standard plant being built. Also, there are some of the provisions of
looking at, that Old Standard would also provide a letter of credit, a bond to
ensure that the District’s rates are unharmed, they’re not affected, until the
build-out of the Sheridan Development will actually support itself, so the
District and its ratepayers aren’t harmed by the building of this particular
project.
In looking upon
that, depending upon the evidence that’s presented today, that’s the two
Staff’s alternatives and at least we would like to have the Commission
understand and hear both sides, both provisions from Staff of looking at those
recommendations. And we will proceed
with that particularly in the rest of the hearing. Thank you.
CHAIRMAN MCKINNEY:
Now we’re ready to
begin to take public comments. You will
not be sworn in, but please come up to the witness stand here on my right. Please speak slowly and into the microphone
so we can hear you, particularly the court reporter, who will be taking down
remarks, so that we may review them when we decide this case. We need to know your name and address
first. Please spell your name and any
parts of your address that could be spelled in more than one way. After that, you may make your comments. I believe we have one public comment. We had someone sign up. And it’s hard for me to read. It looks like Lynda ---.
MS. LEIMBACH:
Leimbach.
CHAIRMAN MCKINNEY:
Yes.
MS. LEIMBACH:
Good morning. How are you?
CHAIRMAN MCKINNEY:
Good.
MR. LEIMBACH:
My name is Lynda,
that’s L-Y-N-D-A, Leimbach,
L-E-I-M-B-A-C-H. I live in Harpers
Ferry. It’s 45 Pintail, P-I-N-T-A-I-L
Court. And that’s in Harpers Ferry,
West Virginia. I’m coming here kind of
as a dual purpose. I have been a
resident of Jefferson County for nine years.
My husband is a Shepherd University graduate, I’m a Shepherd University
graduate, our son is a Shepherd University graduate. We have always been in love with Jefferson County, that’s why we
moved there nine years ago.
Fortunately, there was some building going on at that time which enabled
us to move in. I also work for K.
Hovnanian Homes, who is going to be the builder for Sheridan Estates.
I have brought
some letters from some of my homeowners whose lives have been drastically
affected by this two-year delay. It is
true that homes were sold in January --- January 17th of 2004. We thought we were going to be able to move
forward. We have not received any
permits for that community to be able to start building. Some of my homeowners really wanted to come
but could not bear the expense of a hotel and airfare to come here, so I am
here to speak for them as well as for myself and for the growth of Jefferson
County and the future of Jefferson County.
But I have some
homeowners who –-- they are residents of West Virginia, and they’ve lived in
West Virginia for 15, 20 years. One
couple has lived there for approximately eight years, he’s a fireman. Him and his wife are due for their first baby
in August of this year. They certainly
thought they would have been in their home by now. And they haven’t even put together a nursery yet because of all
the delays. I have another homeowner
who got married last year. He thought
he would have been in his home last year.
His wife is going to West Virginia University, he lives in Waldorf,
Maryland, which is approximately two and a half hours from Jefferson
County. He has had to stay down there
living with his dad and she’s going to West Virginia University. Their one-year anniversary was in July and
they’ve been separated all this time.
I liked some of
the comments this gentleman made, and he said, in a little over two weeks it
will be our one-year wedding anniversary.
We still have no house to celebrate in, no house to have friends over
in, no house to have family over in, and no house to live together as husband
and wife. These are just a few of the
letters that I would like for the Commission to review, to see how it has
affected some of the homeowners’ lives.
I’ve been enjoying
Jefferson County for nine years and I would like to see other people be able to
come into our county and enjoy it as much as I do. Since Sheridan has not been able to move forward, which is what I
was hired for two years ago, they have moved me to the Huntfield
community. I know that community is a
3,200 home community and these capacity that they’re talking about the Charles
Town plant being increased to isn’t even going to handle that 3,200 home
community. So as I believe as has
already been mentioned, the sewer plant capacity that’s being increased is
already spoken for.
We have a lot of
commercial components --- and this is talking as a resident of Jefferson
County. We have a lot of commercial
components coming to our place. We have
Home Depot, we have Premier Breads.
I’ve met with a lot of these individuals. You have to have population to support these businesses, and
without population, these businesses are going to fold. I would hate to see that happen in Jefferson
County. I actually saw it happen in
Frederick, Maryland, where there was no growth for a while, and this was a
while back, but businesses started closing up because the population wasn’t
there.
So I just wanted
to speak as a Jefferson County resident, myself. I am in Harpers Ferry myself.
I think growth is a very good thing.
I’m born and raised DC and moved to Frederick. It grew, but I’ve always loved Jefferson County and that’s why we
moved out here. I also wanted to share
my letters with you. And I also brought
some brochure packs to show you the type of quality home they’re going to be
building. We’re going to be building
homes that are 2,800 square feet to almost 3,800 square feet, so these are not
shabby homes. They’re very, very nice,
good quality homes, and we are a national home builder. That’s all I wanted to share with you today.
CHAIRMAN MCKINNEY:
Thank you.
MS. LEIMBACH:
Thank you. What would you like for me to do with these?
CHAIRMAN MCKINNEY:
Are there other
public comments? If not, we’ll proceed
to the evidentiary part of the hearing.
Those of you that made comments are welcome to stay and observe. This part of the case is presented by the
parties and their Counsel. First, we
will tend to the preliminary matters.
Old Standard had some publication of hearing on May 8, as the Commission
previously ordered.
ATTORNEY MCDONALD:
Your Honor, I
tender an affidavit of publication from the Spirit of Jefferson Advocate
indicating that notice of today’s hearing was published in that paper on July
21, 2005.
CHAIRMAN MCKINNEY:
So are you
submitting this for file?
ATTORNEY MCDONALD:
Yes, sir. We normally mail in affidavits of
publication to the executive secretary, and we did mail in the notice of the
July 13th hearing which has already been made part of the file. But that’s the only copy that I’m submitting
for today’s hearing. Thank you.
CHAIRMAN MCKINNEY:
Are there other
preliminary matters that the parties wish to bring to the Commission’s
attention? Then the Commission is ready
to receive the evidence in this case.
Old Standard, are you ready to proceed?
ATTORNEY MCDONALD:
We’re ready to
proceed, Your Honor.
CHAIRMAN MCKINNEY:
Please call your
first witness.
ATTORNEY MCDONALD:
My first witness
is Mr. Herb Jonkers.
CHAIRMAN MCKINNEY:
I’ll ask the court
reporter to swear in the witness.
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HERBERT
JONKERS, HAVING FIRST BEEN DULY SWORN, TESTIFIED AS FOLLOWS:
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DIRECT
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. Good morning, sir.
A. Good morning.
Q. Would you state your name and
business address, please, sir?
A. Herbert Jonkers, 1784 Kabletown Road,
Charles Town, West Virginia.
Q. And what is your employment, Mr.
Jonkers?
A. I’m a member of Sheridan, LLC and ---
excuse me, manager of Sheridan, LLC and manager of Old Standard, LLC.
Q. Tell the Commission what Sheridan,
LLC is and what its primary project is.
A. Sheridan, LLC entered into a contract
to purchase approximately 99 acres in the early part of 2002 for the
development of 178 lots and subsequently contracted with K. Hovnanian,
successor to Washington Homes, to build 178 homes on the site.
Q. What is Old Standard, LLC?
A. Old Standard, LLC was formed to
purchase 410 acres of an old quarry site along the Shenandoah River, south of
Harpers Ferry.
Q. Are you the manager of the Old
Standard, LLC ---
A. Yes, sir.
Q. --- as well? Mr. Jonkers, did you cause to prepare and be
filed in this case the application for a Certificate of Convenience and
Necessity?
A. Yes, sir.
Q. And did you cause that application to
be supplemented on two occasions, one for initial information on the Division
of Environmental Protection’s NPDES permit and then supplemented again for
information to and from the state Historical Preservation Office?
A. Yes, sir.
ATTORNEY MCDONALD:
Your Honor, may we
have the file of which is the January, 5, 2005 application, together with the
March 31, 2005 supplement, and the April 6th, 2005 supplement, bound in the
notebooks which I have just passed out and marked for identification as Old
Standard Exhibit Number One?
MR. FAULKNER:
Objection. We have not received a copy of that.
ATTORNEY MCDONALD:
Did you ask for
one?
MR. FAULKNER:
Yes.
ATTORNEY MCDONALD:
Well, you haven’t
asked me.
MR. FAULKNER:
We asked --- well,
we asked the PSC for all materials that relate to the application of this
certificate and we did not receive any of that material.
ATTORNEY MCDONALD:
Are you saying,
Mr. Faulkner, that you don’t have a copy of the application?
MR. FAULKNER:
That is
correct. And the amendments.
We have
the original but not the amendments.
ATTORNEY MCDONALD:
I move that the
exhibit be marked for identification, Your Honor.
CHAIRMAN MCKINNEY:
Let’s go off the
record.
OFF
RECORD DISCUSSION
BY
ATTORNEY MCDONALD:
Q. Mr. Jonkers, I’m going to show you an
aerial photograph and display it for the Commission. And I’m going to ask you to authenticate it. And then I’m going to ask you to describe
for the Commission what is depicted on this aerial photograph. First, generally describe what is it and then
we will see if we can get it marked as an exhibit.
A. It’s an aerial photograph of the area
which contains Sheridan Estates on the lower-right quadrant and the Old
Standard quarry site in the upper middle of the photograph.
Q. You may leave your seat.
A. I’m sorry.
Q. This view is generally south up?
A. This is south, north Charles Town, in
this direction, Harpers Ferry is in this direction. This is the Shenandoah River, this is the quarry excavation,
which is nearly a mile long body of water, it’s a lake. This is the Sheridan
Subdivision. This is an industrial site
known as Amerigas, where they make concrete pipe, boxes, culverts and
such.
This construction that’s going on
here is on the Park Service property, which is the customs --- where they’re
putting in a customs facility. It’s an
underground firing range training facility.
The quarry property is from
approximately right here all the way to this tip over here and is approximately
a mile and a half in length. The white
areas here are the old industrial Brownfields location. There are spoil piles
which we’ll show some photographs of later.
It’s approximately one to two million yards of pipeline that was
reject. These old buildings --- old
concrete buildings are falling apart.
The quarry has not been active since, I believe it’s 1974, when they
couldn’t keep up with the infiltration of water.
This is an old dump site known as
the Millville Dump, for which we have a remediation program. This entire area through here has been
released, with the exception of this ten-acre site from the voluntary
remediation program that we entered into when we bought the property back in
2003. I believe that’s all.
Q. Mr. Jonkers, is any part of the
Harpers Ferry National Historical Park depicted in that photograph?
A. The Park Service owns this property
right here. And that purchase goes back to when the Park Service had both sides
of the road under contract to purchase for the Fish and Wildlife training
facility. They closed on this
piece. They did not close on this
piece. The owner was in
bankruptcy. He was having some other
problems. Then they opted to purchase
the property in Shepherdstown, along the Potomac River, rather than conclude
this purchase, so the Park Service does own this and ---.
Q. But it’s not part of the actual
Historical Park, though, is it?
A. Not that I’m aware of. It’s owned by the Park Service, that’s all I
know.
Q. Is any part of the park depicted on
the left-hand side of that ---
A. Down in here ---
Q. --- photograph?
A. --- is what’s known as Murphy’s
Landing. And right here is the visitors
center. The Park Service did buy this
park. This is where the visitors center
is located. This is a trailer park,
campgrounds. You’ve got a motel right
here. The Shipley School is right
here. This is Carriage Park
Subdivision, with a commercial car repair facility here and a church right
here.
Q. Carriage Park Subdivision has septic
service for its ---?
A. Septic and well, yes, sir.
Q. Septic and well?
A. Right.
Q. Now, briefly describe for the
Commission the --- again, point out where the proposed Sheridan Subdivision
is. And then with your finger draw a
line tracing the proposed route of the sewer lines to the Old Standard treatment
plant.
A. The pump station would be located
right here. It would be crossing Route
340, coming down the southerly side of 340, up and down Bloomery Road, as soon
as we get to our corner of our property, we’d be stepping across onto our
property. Coming down the old railroad
bed, which traces along through here to our site for the sewer plant which is
approximately right here. I’m sorry,
it’s right here. And then from there,
we’d be coming across here, going out into the river is the effluent line.
The location of the plant is
between two rather substantial berms that, as you can see, is completely
overgrown with trees. No one would be
able to see anything from the road. The
entire plant is within --- contained within a structure, so it’s all enclosed,
there are no outside pools, ponds, whatever.
Everything is pretty much inside.
The two earth berms here and here are the residue of the overburden that
was taken off of the stone as they were working their way down the quarry and
piling up on the side.
Q. Does the Shenandoah River flow from
top to bottom in this photograph?
A. It flows in this direction.
ATTORNEY MCDONALD:
Okay. Your Honor, may we have this photograph
marked for identification as Old Standard Exhibit Number Two?
(Old
Standard Exhibit Number Two marked for identification.)
CHAIRMAN
MCKINNEY:
Hearing no
objection, it will be received.
ATTORNEY
ROBERTSON:
This is
particularly just for a housekeeping matter.
The certificate application, the separate document of the DEP permit and
also the SHPO compliance have different dates in the letter. Is the Commission considering that as one
exhibit?
ATTORNEY MCDONALD:
What’s the
question, Ron?
ATTORNEY
ROBERTSON:
For those three
documents that you identified as an exhibit of Old Standard, is that going to
be identified as exhibit total Number One or is it going to be One, Two and
Three?
ATTORNEY MCDONALD:
No, that’s just
One. The package is the application.
ATTORNEY
ROBERTSON:
Okay. Thank you.
BY
ATTORNEY MCDONALD:
Q. Mr. Jonkers, I’ve displayed on an
easel a map of Jefferson County, titled Jefferson County zoning map. Are you familiar with that map?
A. Somewhat, yes, sir.
Q. That does represent the entire
county, ---
A. Right.
Q. --- so would you point out to the
Commission where the major geographical features in the county are, including
Charles Town, Ranson, Harpers Ferry, Shepherdstown and so on?
A. This is Charles Town, Harpers Ferry,
Shepherdstown. This is the Old Standard
quarry site. This site here includes
both the old quarry that’s on Blair Road and the property that the Park Service
purchased for the Fish and Wildlife Training Center. The property approximately right here is the Amerigas facility
that we showed in the photograph. And
Sheridan is right here.
Q. And do you believe that map
accurately depicts the zoning classifications at the time that it was prepared,
which looks to be about 2002?
A. It was prepared for the Jefferson
County Planning Commission by Dewberry (phonetic) Surveyors, and, yes, I think
it’s accurate.
ATTORNEY MCDONALD:
Your Honor, may we
have the zoning map marked for identification as Old Standard Exhibit Number
Three?
(Old
Standard Exhibit Number Three marked for identification.)
CHAIRMAN
MCKINNEY:
Hearing no
objections, we will receive it.
BY
ATTORNEY MCDOHALD:
Q. Mr. Jonkers, describe briefly for the
Commission, now back to Sheridan, the Sheridan Subdivision, the --- well, let’s
display some photographs. I’m going to
hand you a photograph that’s titled Sheridan Subdivision, August 2005, and ask
you, to the best of your knowledge, who took that picture?
A. I believe it was taken by Mr.
Snyder. It shows the first paved road
into --- and a storm water detention pond in Sheridan and the Carriage Park
houses in the background.
Q. This is generally looking northeast
maybe?
A. It would be looking northeast.
Q. I hand you a second photograph and
ask you --- all these photographs were taken by Lee Snyder, were they not?
A. Yes.
Q. What is that next photograph?
A. That’s the drainage swell along the
first entry road, showing the water meters, sewer laterals, fire hydrants, and
the house construction pads.
ATTORNEY MCDONALD:
Your Honor, may we
have the first photograph that’s been handed out, the 8 and a half by 11,
marked for identification as Old Standard next number, Number Four, I
believe.
(Old
Standard Exhibit Number Four marked for identification.)
CHAIRMAN MCKINNEY:
So marked.
BY
ATTORNEY MCDONALD:
Q. Now Mr. Jonkers, I’m going to show
you a third photograph called Sheridan Subdivision. This one’s got a number three on it, August ’05. Could you tell the Commission what this
photograph depicts?
A. This photograph would be the third
cul-de-sac up on top of the hill, looking south, showing a graded road, sewer
laterals, fire hydrants, indicating that the water services have been
installed.
ATTORNEY MCDONALD:
Your Honor, may we
have this photograph marked for identification as Old Standard Exhibit Number
Seven?
(Old
Standard Exhibit Number Six marked for identification.)
CHAIRMAN
MCKINNEY:
So marked. And that’s Exhibit Number ---?
ATTORNEY MCDONALD:
Six, sorry.
BY
ATTORNEY MCDONALD:
Q. Do these pictures accurately depict
the Sheridan Subdivision, if you will, as it exists today?
A. It depicts is as it exists today, all
of the --- or I’d say 99 percent of the overlot grading has been
completed. All but about 30 lots are
improved with sewer and water laterals.
That’s all that’s remaining to be done on the site.
Q. So you got paved roads?
A. We have paved roads to approximately
40 lots, and then just graded roads ready for gravel for the balance.
Q. Okay. Have any houses been built?
A. No.
Q. Why not?
A. We had received two building permits
and then they were revoked when we reversed our flow on the sewer line instead
going to Charles Town, where there was no capacity to the new plant, which was
proposed at Old Standard. The county is
now in the process of issuing new permits.
Q. So you think you can get some
building permits?
A. That’s correct.
Q. How is this real estate deal
working? You’re a developer, you buy
the land and you put in roads and water and sewer, and then ---
A. I sell ---.
Q. --- do you sell lots individually?
A. I sell lots in bulk to National
Builders.
Q. And then they sell to ---?
A. And they sell to the individual
homeowners.
Q. Okay.
A. One of --- the first picture shows
their sales trailer in the corner, which has been vacant for about the better
part of a year.
Q. How long has the lack of sewer been
holding up the construction of houses at Sheridan?
A. We started the process of trying to
build our own plant and going through the exercise of buying a state-of-the-art
facility, I would say at the end of 2003, first part of 2004.
Q. Okay.
A. We went to the PSD in, I think it was
in April or May of 2004, to propose and come to an agreement on the four
documents which we will talk about later.
Q. Okay. So is it true to say that lack of sewer is what’s holding up
---
A. Yeah.
Q. --- house construction in Sheridan?
A. That’s correct.
Q. And I’m going to hand you a series of
pictures that I’d like for you to identify for the Commission. These pictures were also taken by Lee
Snyder, were they not?
A. Yes, they are.
Q. He’s going to be a witness in a
little bit. Describe the picture that
is being ---
A. This is part of ---
Q. --- displayed currently.
A. --- the Old Standard quarry in
operation, which obviously is falling into disrepair and is falling apart. These are some old kilns that were on site
where lime was burned back in the early part of the century, the 1900s. The quarry had gravel that had a high level
of magnesium in it and this material was shipped to Pittsburgh for additive to
steel. When that market dried up,
because of the shift in the depth of the rock, they changed to a different product,
rock wool, which was a predecessor to Fiberglas insulation.
Q. How long, again, has that
manufacturing process been stopped there?
A. It’s my understanding that the whole
facility closed down in 1974, when they pulled everything out of the pit.
Q. Okay. The next picture I’m going to hand you says number five, Old
Standard quarry. Describe what this
picture displays, please.
A. Again, these are some old kilns and
part of the structures that are in the Brownfields area, or what was considered
the Brownfields area.
ATTORNEY MCDONALD:
Your Honor, let me
make sure we’re up to date here. I have
three pictures of Old Standard, Exhibits Four, Five and Six, and now two of Old
Standard quarry site, Number Seven and Number Eight. Can we have this most recent one marked for identification,
Number Eight?
(Old
Standard Exhibit Numbers Seven and Eight marked for identification.)
CHAIRMAN
MCKINNEY:
So
marked.
BY
ATTORNEY MCDONALD:
Q. I hand you a picture labeled Number
Six, Old Standard quarry. It has a photograph
of what appears to be a big tank.
Explain what that picture depicts, please.
A. That’s an old lime silo that is still
full of lime. Obviously, the concrete
is giving way and it’s going to topple over one of these days.
Q. Incidentally, is this --- are these
ruins and this tank a part of the area which is part of the remediation
program?
A. Yes, sir. The entire property was put into a voluntary remediation
program. And of that --- of the
property, approximately 300 acres has already been released and 100 acres still
needs to be taken care of. That 100 acres has now been tested and
completed. And we have a toxicologist
here who will testify to its safety.
Q. I’m sure the Chairman understands
remediation, but why don’t you tell the rest of us, briefly, what that means.
A. Well, we had to have Triad
Engineering do a lot of testing on site to check soils, check any lime piles,
check water in the lake, anything that might have some toxic quality to it
which would interfere with anything we would want to do with the property at a
later date. As a result of all of that
testing and some work that we have done on site in cleaning up some of what’s
known as the hot spots, we have gotten the 300 plus acres released. And we still have to deal with the old manufacturing
site, which testing has now been completed.
And we have to finish up with actually capping the old dump site, the
old dump site.
Q. Do you know whether the land and
structures depicted in the photographs that we’ve already looked at cover remediated
land or unremediated land?
A. This area has not been remediated,
but it has been completely tested and found to be acceptable.
Q. Okay. Now, I hand you another ---.
ATTORNEY MCDONALD:
We marked this
tank, didn’t we?
CHAIRMAN MCKINNEY:
Yes.
BY
ATTORNEY MCDONALD:
Q. I hand you another one, another
photograph, labeled Number Seven, Old Standard quarry. And I ask you to explain to the Commission
what’s depicted by that photograph.
A. These are some of the lime piles, the
reject lime piles, which we have somewhere between one and two million yards of
reject pile.
ATTORNEY MCDONALD:
Your Honor, I ask
that the lime piles be marked for identification as Old Standard Exhibit Number
Ten.
(Old
Standard Exhibit Number Ten marked for identification.)
CHAIRMAN
MCKINNEY:
So
marked.
BY
ATTORNEY MCDONALD:
Q. I now hand you a photograph labeled
Number Eight, Old Standard quarry, and ask you to explain for the commission
what this photograph depicts.
A. This was the old rock wool manufacturing
facility, which is going south from the first number of structures that we
showed you. The old railroad track that
this --- upon which we’re going to put the wastewater treatment facility would
be just to the left of this picture.
Q. I now hand you a photograph labeled
Number Nine, Old Standard quarry, and ask for you to explain to the Commission
what this picture depicts.
A. This is, in fact, the old railroad
bed. And the circle area, the widened
area, is where the plant is going to be situated. The plant will have roughly a dimension of, I guess 50 by 60
feet. It looked like a barn sitting
there. And that’s the entire facility. The incoming flow will be coming from the
direction that the photographer was sitting in. And the effluent line will be going further down the track,
looking down into the woods.
Q. Is that site in open view?
A. No.
If you look to the right, you can see the trees are starting to grow up
a hill. And on the left, they’re
starting to grow up a hill. So on both
sides, either from the lake or from the road, and to approximately 300 feet off
the road, you wouldn’t be able to see the site. The hill is taller than the peak of the roof.
ATTORNEY MCDONALD:
Your Honor, may we
have photograph label Number Nine marked for identification as Old Standard
Exhibit 12?
(Old
Standard Exhibit Number 12 marked for identification.)
CHAIRMAN
MCKINNEY:
So
marked.
BY
ATTORNEY MCDONALD:
Q. Mr. Jonkers, approximately how far is
the proposed plant site from the edge of the river?
A. It’s about 4,000 feet. It takes 4,000 feet of pipe to get to the
river for the effluent line to discharge this water.
Q. Now, I wonder if you could, in just a
few sentences, summarize the agreements that you have with Jefferson County
Public Service District. In other
words, how is this deal going to work?
A. Basically, what we’ve agreed to do is
donate to Jefferson County Public Service District approximately three acres,
which we have already conveyed, for a dollar. We’ve leased it back from them
for a dollar. We will build the plant
and all of the lines coming to the plant and from the plant. And when the entire project is built and
operating, they will have a --- we have a maintenance and operational agreement
--- operating and maintenance agreement with the JCPSD. And then when the project is completely
built out in terms of the housing, they will buy it from us for a dollar.
Q. Well, at some point they’ll buy it
from you for a dollar, generally, upon completion of construction of a
wastewater treatment plant and testing; is that right?
A. Well, it will be a little bit after
that, but it’s --- effectively, yes.
Q. Meanwhile, they’re going to operate
the system, are they not?
A. That’s correct.
Q. There’s been some concern expressed
by the Staff during our discussions about the financial feasibility of this
plant. Explain to the Commission, if
you will, what steps you’ve taken to assure that this plant would be
financially feasible for the District.
A. We will be providing a $50,000 letter
of credit to guarantee any shortfalls in operation of the facility. And all of our cost projections indicate
that that would be more than enough to double whatever shortfall would occur
during the first year. After the first
year, it starts to break even. And at
the end of the third year it’s actually making a profit of $20,000 a year.
Q. And have you agreed with the District
to financially guarantee that the District will not lose money on this until
the plant is profitable for two consecutive quarters?
A. That’s correct.
Q. And JCPSD is going to bill --- send
bills to your homeowners?
A. That’s right.
Q. Does Old Standard intend to remain a
utility or to cover the costs of its construction or financing through rates?
A. No.
Absolutely no.
Q. What is the status of the permits
required from the West Virginia Health Department?
A. We have a permit from the West
Virginia Health Department.
ATTORNEY MCDONALD:
Your Honor, that’s
tab five in the filing.
BY
ATTORNEY MCDONALD:
Q. And what’s the status of the Division
of Environmental Protection, NPDES discharge permit?
A. We have an approved discharge permit.
ATTORNEY MCDONALD:
Your Honor, that
is in the March 31, 2005 supplement to the filing.
BY
ATTORNEY MCDONALD:
Q. Has there been any construction on the
wastewater treatment plant at the Old Standard site?
A. The plant is on order and we’re
waiting for its arrival.
Q. What is Old Standard’s investment, to
date, in the wastewater treatment plant and related mains?
A. Well, it’s a combination of Old Standard
and Sheridan. But the total project is
going to run close to $3 million. The
monies expended to date probably are somewhere around a half a million dollars,
just in the plant portion.
Q. Well, this application was filed to
serve the Sheridan Subdivision and perhaps the Shipley School and the Cliffside
Inn. Explain to the Commission,
briefly, the status of your discussions with the school and the Inn for
providing service from this facility to them.
A. We made a proposal to the school
board, it was probably in July of 2003, whereby in exchange for their support
for some of our projects, we would provide for them to hook up the Shipley
School. The Board took no
---
the school Board took no official action on it, but we have had ongoing
conversations with them. We have
included, going to --- talking to them about how their new school board
building was going to be built on another site. And during the course of that conversation, the Shipley School
situation came up again. The chairman
of the school Board and the superintendent of schools are both interested in
getting the septic field closed down at Shipley School and tied into a regular
sewer line.
As for the Cliffside Inn, we had
some preliminary conversations with Mr. Patel.
He was concerned because of the lack of quality of water, his sewer
plant was failing at the Cliffside. He
had some additional capacity and we were discussing trading initial capacity at
his plant for future access to our new plant.
And when he started looking at the numbers, I guess he decided it wasn’t
worth his time to pursue that, because the numbers were getting too big for
him. That’s the Cliffside relationship.
Q. Mr. Jonkers, summarize for the
Commission what it is that you would like for them to do.
A. We would like to proceed with what we
have set out to do, and that’s provide a state-of-the-art facility for the
State of West Virginia. When we first
got started talking to the PSD about bringing sewer service to Sheridan, we had
a main line extension agreement but there was no way to get past the
Breckenridge Pump Station at the time.
Then the capacity issue came up for the City of Charles Town and we’re
sitting there with project going underway and no place for the sewage to
go. So we contacted the PSD. They put us in touch with some folks who had
this state-of-the-art facility who had been in to talk to them, and that’s
Enviroquip out of Austin, Texas. They
came up, made a presentation. And
although their facility was more expensive than a standard facility, we felt
that --- at the time we knew that
Chesapeake Bay regulations were going to come into effect in the near future,
so we figured, well, rather than pay twice, we’ll pay once and get it over with
and do it right to start off with, and that’s where we are.
I feel that this plant is going
to put out water that is a better quality than the Shenandoah River is
itself. And as a result, I just think
we are ahead of the curve. And I think
a lot of the other builders and developers in Jefferson County have seen the
wisdom of this and they are moving ahead with it in the same fashion.
ATTORNEY MCDONALD:
Thank you, Mr.
Jonkers. Your Honor, the witness is
available for Cross Examination.
ATTORNEY
ROBERTSON:
Excuse me, Your
Honor. At this particular time I would
like to ask Mr. McDonald a question.
Basically, it does get into the exhibits that he’s identified for the
record at this time, if that would be allowed.
CHAIRMAN MCKINNEY:
Yes.
ATTORNEY
ROBERTSON:
At this particular
time, I’m assuming Mr. McDonald is also going to call Mr. Lee Snyder ---
ATTORNEY MCDONALD:
That’s correct.
ATTORNEY
ROBERTSON:
--- to provide the
foundation for the taking of these pictures.
ATTORNEY MCDONALD:
Sure.
ATTORNEY
ROBERTSON:
That’s all I
needed to know. Thank you.
ATTORNEY KELSH:
I have a few quick
Cross Examination questions.
CROSS
EXAMINATION
BY
ATTORNEY KELSH:
Q. Mr. Jonkers, if the Commission
approves your application for a Certificate of Convenience and Necessity, how
long do you expect it will take you to complete construction of the
transmission lines and the wastewater treatment plant?
A. We hope to be in the ground and
operational within six to eight months.
Q. Okay. Your Counsel has kept you apprised of the filings by the various
parties in this case?
A. Yes, sir.
Q. Are you aware of any other options
that are capable of providing the Sheridan Subdivision with wastewater
treatment services within the timeframe you expect to receive it, if you
construct this facility yourself?
A. No, sir.
ATTORNEY KELSH:
All right. Thank you.
That’s all I have.
MR. FAULKNER:
Thank you, Mr.
Chairman.
CROSS
EXAMINATION
BY
MR. FAULKNER:
Q. Mr. Jonkers, you say you’re the
manager of the Sheridan, LLC; is that correct?
A. That’s correct.
Q. What is your percentage of ownership
at the Sheridan, LLC?
A. I don’t own anything.
Q. How are you compensated as a manager?
ATTORNEY MCDONALD:
Objection, it’s
irrelevant. It’s a Certificate of
Convenience and Necessity issue.
MR. FAULKNER:
The pattern of
ownership and who else is involved is very critical when we get further into
this matter.
CHAIRMAN MCKINNEY:
Objection
upheld. Excuse me, one second.
OFF
RECORD DISCUSSION
CHAIRMAN MCKINNEY:
I’m sorry. Objection overruled.
ATTORNEY
ROBERTSON:
Mr. Chairman, I’d
like to make a comment about the objection.
CHAIRMAN MCKINNEY:
Just one second.
OFF
RECORD DISCUSSION
CHAIRMAN MCKINNEY:
At this time I’d
like to take a break for 15 minutes.
Before that, I’d ask that Mr. McDonald provide a copy of Old Standard
Exhibit One to the Faulkners and other parties for their review. This is required for all exhibits. At this time, we’ll take a 15-minute
break. We’ll be back at five ‘til
11:00.
SHORT
BREAK TAKEN
ATTORNEY MCDONALD:
In compliance with
your instructions, I have given the Faulkners a copy of Old Standard Exhibit
Number One. We passed out copies of
Exhibits 4 through 12 to all parties as we were displaying those to the
Commission, so they have copies of all those exhibits. That leaves Exhibit Two, which is the large
photograph, and Exhibit Three, which is the zoning map. And with the Commission’s indulgence, we
will get copies of those after the hearing and distribute them to the
parties.
The
big photograph was very expensive. We
will produce smaller versions from the same negative.
ATTORNEY
ROBERTSON:
With the
Commission’s --- the overruling of Mr. Faulkner’s objections, the Staff has a
couple of questions or comments to the Commission. Looking at the Notice of Filing that Old Standard gave
publication to in Jefferson County and submitted an Affidavit of Publication of
their Notice of Filing, their Notice of Filing has --- is to serve only the
Sheridan’s Homeowners’ Association, the Shipley School and the Cliffside
Inn.
We’ve heard from
Mr. Jonkers about the status of the Shipley School looking at connecting to
this Old Standard plant. We also heard
that with the Cliffside Inn, and trying to looking and at hooking up with the
sewer connections for the Cliffside Inn.
As this particular
time, we’ve heard nothing from who is the Sheridan Homeowners’
Association. Is that part of Sheridan,
LLC? We have no indication that
Sheridan --- Sheridan Homeowners’ Association wants and is willing to have
sewer provided by Old Standard, so I think the ownership provisions of
Sheridan, LLC, Old Standard, LLC, is a proper place in this forum with the
Commission to understand the relationship of both of those LLCs. Thank you.
COMMISSIONER SHAW:
The Commission did
not deny the inquiry into ownership.
The Commission did deny how much the witness was making.
ATTORNEY MCDONALD:
May I respond to
Staff’s comments, Your Honor and Commissioners? This application was filed January 5 or so. And at the time, of course, it was proposed
that this wastewater treatment plant would serve three customers, the
homeowners’ association, the school and the inn.
Subsequent to the
filing, the Commission entered its decision in the Sheeley versus Jefferson
County Public Service District case, which established the law in the case that
Old Standard should file for a Certificate of Convenience and Necessity. If it gets a Certificate of Convenience and
Necessity, of course, it becomes a public utility and it has to serve whoever
requests service. So while our original
plan was to serve only three customers, the Commission, in the Sheeley case
asked us to file for a Certificate of Convenience and Necessity and that’s what
we did.
ATTORNEY
ROBERTSON:
May I make a
response? With the applicant’s filing,
that is the Notice of Filing, to serve those three customers, at no time has
this Commission had from the applicant, Old Standard, any expansion or --- an
expansion of the scope of the certificate.
Nothing has been formally filed from Old Standard. And that’s how the Staff works with this
Notice of Filing with these particular three customers. Thank you.
MR. FAULKNER:
And if I may speak
on this matter as well, Mr. Chairman.
What I was trying to get to is that Mr. Jonkers, is he speaking as an
individual, a private citizen, is he as manager of both Sheridan and of Old
Standard. If he has an ownership or
other financial interest, then the Commission should know who he’s speaking for
and what may be motivating his answers.
CHAIRMAN MCKINNEY:
Please proceed
with your examination.
MR. FAULKNER:
Yes.
BY
MR. FAULKNER:
Q. Mr. Jonkers, do you recall the
community impact statement of Sheridan --- or not Sheridan ---. No, I’m going to do this first. The Sheridan community impact statement that
has your signature and was done in December of 2000.
MR. FAULKNER:
Give copies out to
--- especially Mr. Jonkers. I’d like to
have this be the next exhibit. I don’t
know if we number them as our exhibits or these just become another part of the
overall Commission exhibits, but we’d like to enter this into the exhibits.
CHAIRMAN MCKINNEY:
Faulkner Exhibit
One.
(Faulkner
Exhibit Number One marked for identification.)
MR.
FAULKNER:
This
would be Faulkner Exhibit One, I guess.
CHAIRMAN MCKINNEY:
Yes.
A. This is not a document that I have
signed.
BY
MR. FAULKNER:
Q. Yes.
Mr. Jonkers, a community impact statement was submitted to the Jefferson
County Planning Commission on behalf of Sheridan Subdivision. Are you saying that you had nothing to do
with this community impact statement?
A. That’s correct, not the one that
you’ve just handed me.
Q. Will you please --- as everyone will see,
it was received by the Jefferson County Planning Commission and it was approved
by the Jefferson County Planning Commission on January 9th, 2001. Are you saying that as the manager of the
subdivision or Sheridan, LLC, that you had nothing to do with this document?
A. If you’ll note, this is not from
Sheridan, LLC. As I testified to earlier, Sheridan, LLC did not come into being
until 2002, which is when I purchased --- or was part of the group that
purchased the property. This predates
anything I had to do.
Q. So who owned it at that time?
A. Gene Capriotti.
Q. And at that point, you had no
interest in Sheridan, LLC at the point of this community ---?
A. There was no Sheridan, LLC at that
time.
Q. All right. Well, the question is, obviously somebody created this document
that is an official submission required under the regulations of the zoning
subdivision ordinances of Jefferson County.
A. You should find that person and
discuss it with him.
Q. Right. But the issue is, it was approved. It was the first step in making Sheridan Subdivision exist?
A. It could be. I don’t know, I wasn’t involved then.
Q. Okay. To humor me, will you please read number 16 into the record?
A. Jefferson Utilities will provide
water service from its Meadowbrook and Walnut Grove water system. Jefferson County Public Service District
will provide sewer service.
Q. Okay. So at the time that you purchased this --- or Sheridan, LLC came into existence, what was your
understanding of where the sewer service would come from, in terms of location?
A. Jefferson County Public Service
District.
Q. And what facility, at that time, was
your understanding ---?
A. It was to go back to the Patrick
Henry Estates, I believe.
COMMISSIONER SHAW:
I’m sorry, I
didn’t hear you.
A. I believe it was to go to Patrick
Henry Estates.
BY
MR. FAULKNER:
Q. And then from there into the Charles
Town plant?
A. That’s what I just said, it goes to
Patrick Henry Estates.
Q. And again, you were part of Sheridan,
LLC starting on what date?
A. 2002.
MR. FAULKNER:
2002. And I’d like to enter the following document
into the record as Faulkner Exhibit Two.
(Faulkner
Exhibit Number Two marked for identification.)
BY
MR. FAULKNER:
Q. So that the audience understands what
we’re doing, can you please read the text of the letter which I’m offering?
A. Dear Mr. Laughland, the Jefferson
County Public Service District will service the sewage needs of the Sheridan
development through its collection system.
From our system the flow will proceed to Charles Town Wastewater
Treatment Plant.
Q. So as a participant and manager of
Sheridan, LLC, do you recall this letter at that time?
A. No, I don’t.
Q. So, again, as a manager ---?
A. It was addressed to John Laughland at
the facility design group, who was our engineer.
Q. Okay. So as the engineer for Sheridan, LLC, and you as the manager of
Sheridan, LLC, you’re not familiar with this letter?
A. Not this specific letter, no.
Q. But again, this was a letter required
by the subdivision ordinances of Jefferson County?
ATTORNEY MCDONALD:
Well --- no
objection.
A. I knew at that time that it was going
to Charles Town. But you’re asking me
whether I’m familiar with this letter.
No, I’m not familiar with this letter.
MR. FAULKNER:
Okay.
ATTORNEY MCDONALD:
Well, he asked you
if this letter was required by the zoning ordinances. And I’m not sure you presented yourself as a zoning expert, but
maybe you can answer it.
A. It seems to me that this was an
informational letter that was directed to our engineer, not to the Planning
Commission.
BY
MR. FAULKNER:
Q. Can you remember the sequence of
events between the Sheridan, LLC and the Jefferson County Planning Commission
in terms of various approvals? That’s
just a yes or no. I mean, you were the
manager, were you involved with the approval process?
A. To some degree, yeah.
Q. To some degree?
A. Uh-huh (yes).
Q. Then you remember that --- this,
again, may have been before your involvement, but that as probably part of your
due diligence, as a good businessman, you would know that the preliminary plat
was approved by the Jefferson County Planning Commission on July 21st, 2002.
Are you familiar with that?
A. Yes.
Q. Are you also familiar with the final
plat for Sheridan’s Subdivision was approved on April 22nd, 2003?
A. Right.
Q. And that you sought bonding authority
and received bonding authority from the Jefferson County Planning Commission on
September 22nd, 2003?
A. Yes.
Q. And the first building permits or
location improvement permits were issued for the Sheridan Subdivision on April
8th, 2004?
A. Okay.
Q. So at any point through the bonding
process, had Old Standard been discussed with the Jefferson County Planning
Division?
A. No.
Q. So up until that point, all of the approvals,
the community impact statement, which is the first major step that is required
under Jefferson County Subdivision ordinances, the preliminary plat approval,
the final plat approval and the bonding were all done with sewer service coming
from Charles Town?
A. That’s correct.
Q. Okay.
ATTORNEY KELSH:
Your Honor, I’m
going to object to this line of questioning.
I’ve been here listening patiently, trying to see how Mr. Faulkner is
going to try and tie this into the Commission’s standards with respect to
granting Certificates of Convenience and Necessity. And I don’t see how Mr. Faulkner’s getting us there.
In the July 20th,
2005 Order in this case, the Commission said that it would not listen to
re-litigation of issues properly within the jurisdiction of other
agencies. It seems to me Mr. Faulkner
is raising concerns about the Jefferson County planning process. I don’t know that this Commission can do
anything. But if it wanted to, to
modify actions of the Jefferson County Planning Commission, I don’t see how
this is relevant to the decision before the Commission.
MR.
FAULKNER:
Mr. Chairman,
quite to the contrary. We are not
talking about the Jefferson County Planning process or critiquing it in any
way, shape or manner. The whole point
of today’s proceedings is a Certificate of Convenience and Necessity. And they have been, as in the summations at
the very beginning of this day’s hearing, the whole point. And the point of these photographs is that
Sheridan cannot exist without Old Standard, when in fact Sheridan exists
through ---. In the eyes of the
Jefferson County Planning Commission and the Jefferson County government and
all those involved in the planning, zoning and engineering office, Sheridan is
approved. And guess what, Old Standard
had nothing to do with those approvals.
So the whole issue of necessity rests on the fact that Sheridan moved
forward and even received building permits without Old Standard being linked to
it. So that is why --- but that line of
inquiry is completed. We’ve made our
point, we feel.
BY
MR. FAULKNER:
Q. Let’s move on to the --- and in this
case you actually did sign this document.
This is the West Virginia Department of Health and Human Services,
Bureau of Public Health, Environmental Engineering Division, Sewage Collection
and Treatment Systems, forms and required information for Old Standard, LLC,
dated February 3rd, 2004.
MR. FAULKNER:
We’d like to enter
this into evidence as our Exhibit Number Three.
(Faulkner
Exhibit Number Three marked for identification.)
BY
MR. FAULKNER:
Q. And as you can see, Mr. Jonkers, you
have signed this document dated the 1st or the 30th of January ’04. I’m
assuming that’s your signature.
A. Yes, it is.
Q. So on the page after your signature,
they have
---
at the very top of the page it says, facility description. And you have an X for the school and an X
for the subdivision, and then you have number of persons at 3,570. Under C, would you read the number of home
sites, multiple home sites, et cetera?
What’s listed there for C?
A. It says one school, one motel, 180
single-family dwellings, 550 town homes.
MR. FAULKNER:
Thank you. On the last page of the document, which was
part of the attachments to this package --- and the entire package I have in my
hand, Mr. Chairman. The key is, we’re
excerpting the items that we feel are irrelevant to today’s proceedings.
COMMISSIONER SHAW:
Mr. Faulkner, let
me ask you a question, ---
MR. FAULKNER:
Sure.
COMMISSIONER SHAW:
--- get me
straightened out here. Are you
questioning the validity --- the current validity of the permits in place from
either the Department of Health, the Planning Commission? Are you questioning that they are valid
today?
MR. FAULKNER:
No, sir.
COMMISSIONER SHAW:
Then I don’t
understand why we’re going back to it.
MR. FAULKNER:
Because we are
creating a time line, first of all. And
secondly, as I mentioned in my opening remarks about numbers, for this
Commission to approve a certificate --- and, again the burden of proof is on
the applicant.
COMMISSIONER SHAW:
I know that.
MR. FAULKNER:
They must prove,
number one, that it’s necessary for what they plan to serve. Number two, it’s financially viable. And number three, that it actually will
work. And in order to prove that it
will be financially viable, they have to show that there are actually enough
customers so that there’s any possible hope at some point in this thing of not
only breaking even, but turning a profit.
We are questioning
those assumptions. We are also
questioning the assumption that technologically the pipes that are planning to
be laid, pump stations that are planning to be installed, and the membrane
plant that was eventually to be built, needs a certain number of customers to
actually work, otherwise sewer lays in the pipes and doesn’t move. And that’s the main focus of the permits
relating to --- issued by the Department of Health, that they ---. I’m assuming that we’re going to have
members of the Department of Health testifying and they will talk about their
calculations.
So if certain
assumptions are made about how many customers there are and they approve it
based on those assumptions, we feel it is legitimate to question those
assumptions because the Department of Health doesn’t necessarily certify the
number of customers, they only certify the submission.
COMMISSIONER SHAW:
I understand where
you’re coming from. I do not understand going back to these permits. If based on today’s issue ---
MR. FAULKNER:
Yes.
COMMISSIONER SHAW:
--- here, those
numbers are relevant, I agree with that.
But going back to these permits and not questioning their validity, I
have my doubts about.
MR. FAULKNER:
Well, again, we’re
building a record that Sheridan was indeed approved without Old Standard even
being anywhere in plan. So where’s the
necessity?
COMMISSIONER SHAW:
If you want to
attack the validity of those permits, this is the wrong place.
MR. FAULKNER:
No, that is not
what I’m saying, sir. I’m saying that
Sheridan --- it may still look like an empty property with construction
equipment, but it has, in fact, moved a substantial distance because the
Jefferson County Planning Commission turns down subdivisions. They just rejected one unanimously last
month. So the fact is is that a
subdivision moving from a twinkle in the eye of the developer to building
permits is a substantial accomplishment and it was done without Old Standard
being in the mix. Therefore, we start
to raise the issues about the necessity of Old Standard as it is being offered
up as a vital for Sheridan.
COMMISSIONER SHAW:
But you’re getting
the cart before the horse, because a lot of these things you’re asking about
are not before us. This man hasn’t
testified to a number of things you’re getting into. But go ahead, I’m just trying to keep this thing focused a
little.
MR. FAULKNER:
Sure. We are very focused. We feel we’re going to be moving to the next
stage right now.
COMMISSIONER SHAW:
Yes.
BY MR.
FAULKNER:
Q. So on the last page of the health
permit, at least of the excerpts we’ve had, there’s a chart. And again this is a document that you
affixed your signature to, dated January 22nd, 2004. And there are ten items relating to the flow rates that you are
requesting permits for. So what we’d
like to do is, using our map, which I’d like to offer up as our next exhibit,
and this would be Exhibit Number Four, I think, Faulkner Exhibit Four, it would
be this map which is of eastern Jefferson County.
(Faulkner
Exhibit Number Four marked for identification.)
MR. FAULKNER:
And first of all,
I would like to point out --- or my wife pointed out, that the brown on this
map is the current boundaries of Harpers Ferry National Park. As you will see, the entire land ---.
ATTORNEY MCDONALD:
Your Honor, I
assume that the parties’ statements and testimony will be subject to Cross
Examination; is that true? He’s not
just questioning the witness now, he’s testifying.
CHAIRMAN MCKINNEY:
Oh, I see what
you’re saying. You’re calling him as an
adverse witness?
ATTORNEY MCDONALD:
Well, he’s not
asking questions of the witness.
MR. FAULKNER:
No, I am ---.
ATTORNEY MCDONALD:
He’s presenting
evidence and he’s testifying about what those exhibits show. So I assume that we can cross examine him on
the statement.
MRS. FAULKNER:
This is the
Harpers Ferry National Park map.
OFF
RECORD DISCUSSION
MR. FAULKNER:
If I may speak to
the motion, Mr. Chairman? If I may
speak to what Counsel said.
CHAIRMAN MCKINNEY:
Just a
minute. Well, I think we probably need
to continue questioning this ---
MR. FAULKNER:
Yes.
CHAIRMAN MCKINNEY:
--- witness and
quit testifying yourself.
MR. FAULKNER:
Okay. Well, what we’re doing here is the witness
--- and we can ask the court reporter to recall, said that Harpers Ferry Park
did not extend across the street. We
are showing counter evidence to that, that as on Cross Examination, that in
fact Harpers Ferry Park does extend across the street.
COMMISSIONER SHAW:
Then ask the
witness the question, ---
MR. FAULKNER:
Okay.
COMMISSIONER SHAW:
--- don’t tell us
what your opinion is.
BY
MR. FAULKER:
Q. So in your testimony, Mr. Jonkers,
you said that you did not know whether Harpers Ferry National Park was across
Route 27 from your property?
A. That’s correct.
Q. Looking at this map, which is
official map from the National Park Service, does it look like that, in fact,
may have been an error?
A. It’s still not an error because I
don’t see anything on there to tell me that this is an official map.
MRS. FAULKNER:
It’s right up
here. It says, Harpers Ferry National
Historical Park. Oh, I see what you’re
saying, it doesn’t.
A. Who created it.
MRS. FAULKNER:
Okay.
BY
MR. FAULKNER:
Q. So you’re saying this map may be a
fraudulent map?
A. It could be. I’m not a map expert. But I can certainly tell you that there’s
nothing on there that would indicate it’s made by the federal government, that
I can see.
Q. So are you saying that the
legislation passed in 2004, in September, which included all these parcels, may
not be real?
A. I’m not privy to the
legislation. Unless you’re ---.
Q. It was in all the papers, sir.
A. Well, that may be. I know that ---
Q. So you ---?
A. --- the national government --- the
federal government bought the property, that’s all I know.
Q. Okay. So for the sake of reference points, on this map where is the
proposed Old Standard sewer?
A. Do you want me to get up ---?
Q. Well, yeah, we’re going to put some
stickies on the map here. And where’s
Sheridan?
A. Right there.
Q. And the Shipley School?
A. Right here.
Q. In your submission of January 22nd,
you relate to the Kellem Estate, 200 units.
Where would that be?
A. Right there.
MR. FAULKNER:
Okay. The records would show he’s just marked park
land.
A. The park land just got hold of it.
BY
MR. FAULKNER:
Q. Yes.
A. That was not ---.
Q. Okay. I’m not saying that --- I’m not ---.
A. Yeah, well, you’re alluding --- you’re
alluding to the fact that this ---.
Q. No, I’m not ---.
MR. FAULKNER:
For the record, I
am, at no point, stating that the submission made on January 22nd in any way
--- of 2004, in any way is inaccurate in the circumstances of January 22nd,
2004.
BY
MR. FAULKNER:
Q. Again, our line of questioning
relates to how many of those units can ever exist?
A. This map can’t be right because it
also includes Doctor Gibson’s property.
Q. Well, I was going to ---.
A. And Doctor Gibson’s property is not
part of the federal government.
Q. It is not. It is not. It is within
the boundary. That is a different
issue.
A. So if that map is correct, which it
obviously isn’t ---.
Q. It is ---.
A. --- then it shouldn’t include his
property.
Q. Is it the map of the boundary, not of
the holdings, the boundary.
A. So the map is misleading.
Q. The map does not have a title on it,
sir.
A. Well, then why are we looking at it
then?
Q. You mentioned Mr. Gibson. Will you mark where that is on that park ---
on that map?
A. Up a little bit.
MRS. FAULKNER:
Up a little bit?
A. Uh-huh (yes).
BY
MR. FAULKNER:
Q. And where is the 150 units for
Bugler’s Rest?
A. Just north of the quarry.
MRS. FAULKNER:
I don’t know where
that would be. Would you just show me?
WITNESS
COMPLIES
MRS. FAULKNER:
On that white
area?
BY
MR. FAULKNER:
Q. And then Cliffside?
MRS. FAULKNER:
Would that be
right here? Cliffside?
ATTORNEY MCDONALD:
Your Honor, let’s
just have one interrogator of the witness.
MRS. FAULKNER:
Well, I’m just
asking for accuracy on the statement, that’s all.
MR. FAULKNER:
You might want to
use a different color, it’s hard to see.
MRS. FAULKNER:
Okay.
MR. FAULKNER:
Use green or ---.
MRS. FAULKNER:
Okay.
MR. FAULKNER:
Why don’t you use
green or blue.
BY
MR. FAULKNER:
Q. Now, you have 975 units for Old
Standard quarry. So would that be the actual area called Old Standard quarry?
MRS. FAULKNER:
This area right
here. Is that where the 900 units are?
BY
MR. FAULKNER:
Q. You have listed 975 units for Old
Standard quarry on the documents you signed.
A. Uh-huh (yes).
Q. So where would that be located on the
map?
ATTORNEY MCDONALD:
I object. What is the question?
BY
MR. FAULKNER:
Q. Well, is there a location for the 975
units, sir?
A. You put it in the industrial
area. Put it on the other side.
Q. Keep your voice up, Mr. Jonkers, so
that the court reporter ---.
A. You need to stay on the other side of
the quarry, like on the river side here.
You’re right in the middle of the quarry.
MRS. FAULKNER:
Is that better?
BY
MR. FAULKNER:
Q. And, Mr. Jonkers, where is the 60
units for the industrial park that you list in your document?
A. Up there.
Q. And the 200 units for the hotel?
A. At the head of the lake.
Q. So on January 22nd, 2004, Mr.
Jonkers, you attested to these projects either existing or could potentially in
the future exist and therefore you asked for certain permits from the
Department of Health. Today, now, in
August of 2005, which one of these projects are still in the mix, if you had to
do this chart over?
A. The numbers are changed but I would
suspect that the Kellem Estate would be gone.
Doctor Gibson would still be part of the mix at some number.
Q. Just for clarification, since the PSC
people down here may not know what goes on in Jefferson County in detail, what
occurred with the Gibson proposed subdivision in May of this year?
A. That’s subject to litigation.
Q. But what did happen? What’s the official act of the county
government?
A. It was rejected.
Q. Thank you. And so the Cliffside Inn, is that still in play?
A. It could be.
Q. It could be. Well, anything could be.
A. That’s right. It could be.
Q. You could be surveying New York City.
A. That’s right.
Q. Anything is possible.
A. That’s right.
Q. Okay. So is Shipley School in play?
Because you had mentioned that you had some extensive discussions and
even exchanges of documents; is that correct?
A. Uh-huh (yes).
MR. FAULKNER:
I’d like to enter
into evidence a letter relating to the discussions between Jefferson County
Schools and Mr. Jonkers and some of the organizations he’s affiliated
with.
BY
MR. FAULKNER:
Q. Mr. Jonkers, the letter dated March
7th of 2005 asks --- it’s a Freedom of Information Act request to the School
Board. And it asks for any
correspondence, communications, meeting notes, telephone records, faxes or
e-mails. And could you read the last
sentence of that letter into the record, Mr. Jonkers?
A. The Jefferson County Board of
Education is unaware of any such documents possession that are responsive to
the request above, Buster Nicholson (phonetic), Director of Operations.
Q. Thank you.
A. Well, he probably should have talked
to Doctor Nichols (phonetic), because he wrote a letter that contradicts this
shortly thereafter.
Q. Well, can you submit that letter for
the record?
A. Counsel has it.
Q. So you talked about the reasons why
the Drakes (phonetic) or now Old Standard property was up for sale. Since this
is an excerpt from an Exhibit Number Four in the Environmental Quality Board
case, this is a 1990 document that was prepared for the Park Service ultimately
because it was the Drakes Associates who were in negotiations with the Park
Service. And are you aware that the
parks --- the reason why the Department of Interior was not interested in the
Drakes’ property was that it cost them close to $50 million to remediate the
property?
ATTORNEY KELSH:
Your Honor ---.
COMMISSIONER SHAW:
You’re testifying
again.
ATTORNEY KELSH:
That’s not in your
document. And I’m going to object to
Faulkner identifying the Faulkner Exhibit Six, for failure to authenticate
these documents.
MR. FAULKNER:
Are you saying
that we need to have --- are you saying that that’s not the signature for the
material from the Board of Education?
ATTORNEY KELSH:
I’m saying that
you failed to lay the proper foundation to have this admitted into evidence.
MR. FAULKNER:
The witness
testified that he ---.
COMMISSIONER SHAW:
Mr. Faulkner, you
have a witness on the stand; ---
MR. FAULKNER:
Yes.
COMMISSIONER SHAW:
---
correct?
MR. FAULKNER:
Yes.
COMMISSIONER SHAW:
If you want to
introduce an exhibit, you ask him to identify it.
MR. FAULKNER:
Okay.
COMMISSIONER SHAW:
If he can’t
identify it, ask somebody who can, but you cannot identify it. You’re acting as your own counsel. And attorneys don’t testify, they ask
questions.
MR. FAULKNER:
Okay, sir.
BY
MR. FAULKNER:
Q. So going back to the Jefferson County
Schools, since this letter is not to you, but can you identify it as an
official document?
A. No.
Q. No.
Fine. So relating to the --- you
had mentioned that in remediation this document states that they want remove to
all the soil, that you encapsulated the soil; is that correct, in your
remediation? What method of
remediation, did you use to remediate the 300 plus acres that’s already been
approved for remediation?
A. We removed some soil. Let me rephrase. We removed the soil that needed to be removed and we didn’t do
anything to the soil that didn’t have any problems.
Q. So all you did was remove certain
amounts of soil?
A. That’s correct.
Q. Do you recall how much money was
spent on the removal?
A. That’s immaterial. What I can do it for and what you can do it
for are two different things.
Q. But approximate. I mean, you’re the manager of the
property. Wouldn’t you be looking at
the budgets?
A. No.
Q. No?
A. No.
I just write checks.
Q. Okay. In your own Exhibit One, tab C, there is a letter to ---.
COMMISSIONER
STAATS:
Excuse me.
MR. FAULKNER:
Yes?
COMMISSIONER
STAATS:
I’m confused.
MR. FAULKNER:
Okay.
COMMISSIONER
STAATS:
What is this
thing?
MR. FAULKNER:
That was our
exhibit. That was part of an exhibit in
the Environmental Quality Board case, which is Exhibit Number Four in that
case. And this is an excerpt from that
which relates to the remediation plan at the time of 1990.
COMMISSIONER
STAATS:
So this is part of
another document that is or is not part of evidence?
MRS. FAULKNER:
It’s part of
evidence, because ---.
MR. FAULKNER:
Well, the excerpt
is part of evidence in this ---.
COMMISSIONER
STAATS:
This isn’t marked.
ATTORNEY KELSH:
Well, Your Honor,
I objected to documents Five and Six. I
didn’t receive a ruling from the bench.
COMMISSIONER SHAW:
Okay. Which one are Five and Six?
ATTORNEY KELSH:
Faulkner Exhibit
Number Five is the letter from the Jefferson County Schools to the Faulkners,
signed by Buster Nicholson. Faulkner
Exhibit Number Six is a document that has HTS in the upper left-hand corner.
CHAIRMAN MCKINNEY:
Now, these two
documents have not been identified by the witness and therefore they’re not
admitted.
MR.
FAULKNER:
Okay. Fine.
BY
MR. FAULKNER:
Q. Mr. Jonkers, you state that you have
an Environmental Quality --- or Department of Environmental Protection permit
for Old Standard, LLC. What is the
status of that permit at the moment?
A. We are in remediation. We’re following through on our voluntary
remediation program.
Q. The permit for discharge, what is the
status of the discharge permit from the DEP?
A. I believe that’s been challenged by
the Water Quality Board.
Q. Thank you. Do you have any review, as manager of Sheridan, LLC, over the
sales of parcels at that site?
A. What do you mean by the review of
---?
Q. In other words, the brochures, the
training, the hiring of any of the sales people?
A. No.
Q. So who does?
A. K. Hovnanian.
ATTORNEY MCDONALD:
Could you spell
that, please?
A. It's K, period, Hovnanian,
H-O-V-N-A-N-I-A-N.
BY
MR. FAULKNER:
Q. Keep your voice up, please.
A. Sorry.
Q. Do you meet with this person on any
regular basis?
A. No.
Mr. Hovanian lives in a different strata.
Q. And you have no role in talking to
anyone on the sales site?
A. No.
Q. Mr. Jonkers, when you lobbied for
Senate Bill 700, was it because you did not think you could attain standards of
PSC ---?
A. No.
COMMISSIONER SHAW:
That goes clear
beyond the propriety. Don't go back to
the law and see how it was made.
MR. FAULKNER:
Okay. Then I'm completely through.
CROSS
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Mr. Jonkers, ---
A. Yes, sir.
Q. --- I'm trying to get a little bit of
a timeline here. The Sheridan LLC was
actually filed sometime in 2002 with the Secretary of State's office?
A. That's correct.
Q. And then Old Standard filed with the
Secretary of State's office, I believe, early in 2003?
A. That's correct.
Q. And I'm just going to --- I think to
provide a timeline for this Commission, I'm looking back --- I'm going to go
back about a year or two. And the
reason is ---.
ATTORNEY
ROBERTSON:
At this particular
time I'd like to have it identified as Staff Exhibit Number One.
(Staff
Exhibit Number One marked for identification.)
BY
ATTORNEY ROBERTSON:
Q. Could you actually read --- it's a
very short order, the Commission approval order. Are you aware of that particular document or the Commission
Order?
A. No.
And I bought the property with Mr. Capriotti. He told me that he had a mainline extension agreement, and that's
where I left it.
Q. But now with looking at the Sheridan
LLC, that you're just a manager of Sheridan, LLC?
A. That's correct.
Q. With this Mr. Capriotti, this was,
for the Commission's aspect, very summarized, was an alternative mainline
extension agreement with the Jefferson County PSD, and Gene Capriotti --- there
was a final order of the Commission October 22nd, 2001. That does predate the organization of both
Sheridan and also Old Standard; correct?
A. That's correct.
Q. So then is it your understanding that
this was the way Mr. Capriotti obtained --- put in the sewer lines in the
Sheridan development for the 178 lots?
A. Well, we went through --- or he told
me he went through an extensive number of iterations. He started out with an approved site on site to do his own
treatment, which would go in Flowing Springs.
Then he changed to go back to Charles Town or to Patrick Henry, I think
it is. And throughout our conversations
at that time that we were going through the throes of closing on the property,
he continuously and always said it was about 18,000 feet the way he had
easements purchased. I have never seen
a piece of paper that had 8,650 feet of linear force main. It was always 18,000 feet. And if I scale it out today, it's still
18,000 feet, regardless of what kind of number is on this piece of paper.
Q. At this particular time, are you
authorized to speak on behalf of the Sheridan LLC?
A. Yes, sir. That's why I'm here.
Q. And looking at your Notice of Filing,
is the Sheridan property Homeowners Association, is that also owned by Sheridan
LLC?
A. No.
I think it's a separate organization.
I'll be honest with you, I don't remember. I just asked the
---
Mr. Crawford, our attorney in town, to set it up so that we had a viable
homeowners association. I believe I'm
the manager of that also.
Q. So then either the Sheridan
Homeowners Association or Sheridan LLC, there's nothing in the file or indication
as to the status that either one of those entities is requesting sewer service
from Old Standard LLC?
A. That could be, yeah. I don't know what's in the file.
Q. But as a manager of Sheridan LLC,
have you made a request or looking to get served by the Old Standard LLC?
A. Well, since I'm a manager of both, I
can look in the mirror and ask myself to provide service. That’s really what you're asking. Since the manager of both organizations, I
really don't have to make a formal request to myself.
Q. With that said, that is the desire of
Sheridan LLC, is to receive --- currently to receive sewer service from the Old
Standard?
A. That's correct.
Q. Looking at after the Sheridan LLC was
created, at different times as manager of the Sheridan LLC, did you approach
the Jefferson County Public Service District to actually make a request for
services to serve the 178 lots in Sheridan?
A. What are you asking, for individual
lot permits?
Q. No.
I'm asking you, as the manager of Sheridan LLC, did you make any types
of requests to the Jefferson County PSD to receive sewer service?
A. Well, we had a mainline extension
agreement, if that's what you're asking me.
Q. Okay. And can you tell me what happened or did not happen with that
mainline extension agreement?
A. Well, it became obvious at the end of
2003 that there was no capacity in the Breckenridge facility. As I testified earlier, the folks at the PSD
introduced me to Mr. Pittcairn (phonetic), who's sitting back in the back. And
he and the folks at Enviroquip made a presentation as to the quality of the
effluent that would be produced from a facility that we could not build on a
piece of property that we had close by.
So in the course of the next several months, we engaged Mr. McDonald to
draft up documents which we presented to the PSD and, after some give and take,
they accepted. And then we, in mid
2004, reversed our flow to go east instead of west.
Q. So is it your understanding that the
Breckenridge Pump Station is owned by the Jefferson County Public Service
District?
A. I assume so. Who owns it is immaterial to me. When the man says it can't pump any of my
flow, that's all I needed to know is to find an alternative for how we get rid
of that flow.
Q. Well, if you can recall, who made
those representations about the Breckenridge Pump Station to yourself?
A. Ms. Lawton and some of her staff.
Q. Ms. Lawton is the manager of the
Jefferson County PSD?
A. That's correct.
Q. So with that, did you approach Ms.
Lawton about building a line from the Sheridan development over to the
Breckenridge ---?
COMMISSIONER SHAW:
Mr. Robertson, can
I ask you something? I understood in your opening statement that Staff approved
the application subject to confirmation and financial stability and subject to
the feasibility of another site. Am I
mistaken?
ATTORNEY
ROBERTSON:
I'll say to a
degree. Staff's first recommendation is
looking at taking the Sheridan development and going back to the Breckenridge
Pump Station for orderly and timely development. In the alternative, the Staff would have looking at the other
contingencies of approving the Old Standard plant. But the Staff's first preference in this particular case is to
have the Sheridan development go back in and tie into the Breckenridge Pump
Station. And we will have testimony and
evidence showing that that will work.
COMMISSIONER SHAW:
I didn't
understand that from your opening.
ATTORNEY
ROBERTSON:
Okay. Sorry about that.
BY
ATTORNEY ROBERTSON:
Q. I believe, Mr. Jonkers, I was asking you
that did you or Sheridan LLC approach the district or Ms. Lawton about running
a mainline extension from the Sheridan Development in a westerly direction to
tie into the Breckenridge Pump Station?
ATTORNEY MCDONALD:
Could you repeat
the first part of that question?
ATTORNEY
ROBERTSON:
Yes.
BY
ATTORNEY ROBERTSON:
Q. With Sheridan LLC, did you talk or
have written information from Sue Lawton, manager of a public service district,
approaching them about running a mainline extension, a main sewer line
extension, from the Sheridan development into a westerly direction to tie into
the Breckenridge Pump Station?
A. I couldn't tell you the answer to
that specifically. I can tell you that
we had a mainline extension agreement to go west for 18,000 feet.
Q. Okay.
A. And when we concluded the costs of
the 18,000 feet, the lack of capacity at the pump station and then the ensuing
lack of capacity in Charles Town, it became evident that we had to have an
alternative solution. And the
alternative solution was a property that we purchased in 2003 at the Old
Standard Quarry, which was substantially closer. That fits in with this 8,000 feet that's in the mainline
extension agreement that you handed me, then would allow us to provide service
in a much more timely fashion.
Q. Did the District inform Sheridan LLC
that they had a moratorium on the Breckenridge Pump Station?
A. They told us there was no additional
capacity. And if you go back through
the minutes of their June or July meeting of 2004, they asked the PSC for a
moratorium issue for the whole county because there was no additional capacity,
which was in the same timeframe that they approved our four documents for going
to Old Standard.
Q. And do you know if the Commission has
actually approved that moratorium?
A. No, they didn't. But you know, whether you approve it or not,
the fact is there is no --- there are no taps being issued, so there is a
moratorium.
Q. Moving on to another topic, looking
at --- Mr. McDonald asked you questions about --- with Old Standard, I'm
looking at the certificate application with Old Standard. Once the construction of the treatment plant
is built, Old Standard builds it, then what is actually going to be the process
to turning that particular plant and collection lines over to the
district? I suppose you have different
answers .
A. No, we don't have different
answers. You have copies of those four
documents. You've studied them. You've looked at them and you know exactly
what the process is.
Q. Earlier in your testimony you said
that --- first of all, you said that after the 178 lots had been milled out,
then at that particular time, that Old Standard would convey the property, the
assets, over to the District. Then you
said, I believe, anywhere from about 15 to 20 houses then will be
conveyed. So I'm trying to get ---.
A. No.
I don't think I said anything about 15 to 20 houses. I don't remember saying that at all.
Q. Let me try to reclassify that. I believe you said that sometime after the
plant is built, sometime.
A. Right.
Q. So that's ---?
A. That's exactly what I said because
basically you had --- there's a shakedown period. There's an operating maintenance agreement wherein they are paid
to operate and maintain the plant and get it up and running and operating correctly
and wherein during that time period I'm financially responsible for making sure
that they have no losses. And I would
presume that after about a year and a half of operation, it will pay for itself
because of the development of the lots.
Q. Looking at then the timing mechanism
of going and conveying this over to the District, as you're sitting here today,
is it your testimony that Old Standard is going to become a certificated
utility?
A. That was not the original intent in
terms of having the homeowners association be our single customer. But that is
still whatever --- whether they are a single customer or not be a single
customer, then --- if we have a certificate, then I guess we'll be the utility.
Q. All right. Then if you are granted the certificate, then you would be filing
rates and charges here with an approved tariff with the Commission?
ATTORNEY MCDONALD:
Your Honor, he's
getting into some legal issues here, you know.
We said in the application that we intend to use the rates of the JCPSD. JCPSD is going to bill the customers,
they're going to run the plant, they're going to use their own rates. We want to get rid of this just as soon as
we reasonably can. So as to whether we
have to file a tariff here, I don't know.
Maybe this is something you need to tell us what to do. This is a unique project. This is a new idea. We'll do what you tell us to do. But we just want to build this plant and get
it running right and turn it over to the utility.
ATTORNEY
ROBERTSON:
The reason for my
line of questioning of Mr. Jonkers, I believe it's very key, from the Staff's
perspective and also the Commission's perspective, depending upon if this is
going to be an immediate transfer over to the District or it's going to be some
lag of time where Old Standard would be a certificated utility. And the reason for that is, the Staff's
concern is if you have 30, 40, 50 lots served in the Sheridan development and
the district does not have the ownership of this collection line and the plant
and someone in the development files a complaint, the question is, who do they
file a sewer complaint with? If it's
not the District's ownership of it, then you have to have some way to file a
complaint regarding the sewer service.
And that was my reasoning for asking those questions. If the District doesn't own it, Old Standard
has to own it. So then at least
somebody can file a complaint with the Commission if there's inaccurate sewer
service, other complaint issues. And
that was looking at it from the Staff's concern of having a utility, so a
complaint could be filed so then we would have jurisdiction to investigate the
complaint.
COMMISSIONER SHAW:
How does that
address the two conditions that you've cited?
ATTORNEY
ROBERTSON:
One is looking at
--- I'm going to get into the financial considerations. The other is looking at if Old Standard is
going to be the utility that runs this operation or if it's going to be the
District. If it's the District, they're
already a regulated utility by this Commission and there's a complaint filed,
then Staff can go and investigate the complaint.
COMMISSIONER SHAW:
Just asking.
ATTORNEY
ROBERTSON:
But that wasn't my
reason for asking ---.
COMMISSIONER SHAW:
We'll let him
answer, okay.
BY
ATTORNEY ROBERTSON:
Q. Mr. Jonkers, then looking at this
with Old Standard, is it Old Standard's intentions to become a certificated
public utility or a private utility regulated by this Commission?
A. The intent of our agreements are to
turn this thing over just as quickly as we can. It's my understanding that until we hit 25 customers, we don't
need to have --- we're not a utility.
And it would be obviously my desire to turn this thing over as quickly
as possible so we don't end up with a --- I don't want to be in the utility
business. I have no interest in being
in the utility business. I don't want
to send out bills or collect this or that or the other. That's their job.
Q. With my line of questioning of
looking at the Staff and the Commission, of looking at if there was a complaint
filed, do you understand at least the Staff's rationale for that line of
questioning?
A. Well, I would have to agree with the
Commissioner that, you know, based on --- we recommended that the certificate
be approved after we look at going to Charles Town, that we've gone afield.
Q. Does Old Standard --- if the
Commission, with the evidence, grants Old Standard the certificate to build
this plant, does Old Standard, once it is up and operational, before it's even
hooking up any customers, does Old Standard have a problem with immediately
conveying it to the Jefferson County Public Service District?
A. I'm not hesitating because I'm trying
to think about the combination and permutations of what you're saying, I'm ---
Q. Take your time.
A. --- just --- don't see a need to be
in that big a rush. We've got issues
that any new structure and/or mechanical facility has. And for us to turn it over before we've had
any kind of a shakedown of the project I think would be foolhardy, because then
you just add one more level of people involved in getting it running
right. I think getting it run properly
and operational is more important than the immediacy of turning it over.
Q. So looking at then getting it on
line, getting it operational, until operations checks out A-okay, is it the
intentions of Old Standard to hook up any customers before that time?
A. I don't think you can operate the
plant without any customer flow coming to it.
Q. But you want to guarantee, I'll say a
test run of this plant, before you convey it over to the District?
A. Right.
Q. And that's the reason for the Staff's
concern, was even if you start hooking up customers and have not finished all
the checklist of being operationally sound and there's a complaint filed, the
Commission needs to be aware of that complaint; wouldn't you agree?
A. I don't know why you'd be involved in
any complaint on something that is just going through a shakedown. Why would you be involved? We're doing the repair work. We're doing the fix-up work. Why would you get involved?
Q. The Staff would get involved, and the
reason is because possibly it affects a customer. And you said that you didn't want to bill customers; correct?
A. That's right. That's why we have an operations and a
maintenance agreement with the PSD.
Q. And that's an O&M agreement?
A. Right.
Q. Then have you had another agreement,
such as a billing agreement, or is that contained in the O&M agreement?
A. That would be in the O&M.
ATTORNEY ROBERTSON:
If I could just have a second?
COMMISSIONER
STAATS:
May I ask a
question? Does the O&M agreement
cover the test period?
A. Yes, sir.
ATTORNEY
ROBERTSON:
At this time the
Staff has no other witnesses (sic) of Mr. Younger, so we'd like to reserve the
right to recall him.
CHAIRMAN MCKINNEY:
Do any other
parties have questions of Mr. Jonkers?
We'll grant that.
ATTORNEY
ROBERTSON:
You'll grant that?
CHAIRMAN MCKINNEY:
Yes. Thank you.
You may be excused.
A. Thank you.
ATTORNEY MCDONALD:
Your Honor, I have
one or two questions on Redirect.
REDIRECT
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. You were asked some questions, Mr.
Jonkers, about planning and zoning approval of the Sheridan Subdivision. Have the planning and zoning folks in
Jefferson County recently approved the movement of the wastewater to the Old
Standard plant and away from Charles Town?
A. Yes, they have. We submitted a new set of plans, red line
revisions. The Planning Commission
approved the staff, the Jefferson County Planning Staff, the right to authorize
that change last October and --- I believe it was October. And we have submitted all of the redesign
and they have been signed off and we have applied for building permits to get the
project started.
Q. So when the Faulkners filed a lawsuit
against the Planning Commission last week about that, that did not stop the
process of proceeding at ---
A. No, sir.
Q. --- Sheridan; is that right?
A. No.
Q. You were asked a couple questions
about your relationship with the school board and the offer to the school board
to provide wastewater service to them.
Did you cause a proposal to be made to the school board at some point?
A. Yes, we did.
Q. I hand you a two-sheet package of
papers and ask could you explain this to the Commission? What is this?
A. This is an outline of various
projects that we have in Jefferson County.
And I asked Mr. Chakmakian, an attorney in Charles Town, to make a
proposal to the school board wherein we would provide a new Board of Education
school building on a project we're doing in Ranson in exchange for some dollars
and their support of various projects.
One of the projects that would also come their way would be the addition
of Shipley School to the --- we would provide access to the sewer plant for
Shipley School, and we would provide a bus facility on Old Standard. None of that was ever acted on. It was submitted --- it was offered. It was not acted on, so it kind of died a
natural death, although we are still talking about building them a new school
board office at their Blackford Farms project.
Q. Are you saying that the Shipley
School and the school board has lost interest in the Old Standard project or it
just ---?
A. No.
What they lost interest in was supporting our various rezoning efforts. They never acted upon it. But as late as ---
I want to say a month ago, maybe a little bit longer, they are still interested
in having Shipley School hooked up to the sewer line so that they can abandon
the septic field that is currently serving Shipley School.
Q. And you've actually discussed that
subject with the Superintendent of Schools; have you not?
A. That's correct, the superintendent
and the head of the school board.
Q. I hand you a letter dated June 9,
2005, addressed to whom it may concern from the superintendent of the school
board. Would you explain this letter to
the Commission, please?
A. Well, when it became clear that the
Faulkners were questioning my veracity, I asked Mr. Nichols, Doctor Nichols, to
confirm that we had had these discussions about Shipley School. And he did so in a very lawyerly fashion to
avoid any conflicts.
ATTORNEY MCDONALD:
Your Honor, may we
have the school board proposal marked for identification as Old Standard
Exhibit 13 and the to whom it may concern letter marked as Old Standard Exhibit
14?
MR. FAULKNER:
I object to the
second letter, Mr. Chairman, on the ground that it is not notarized and we do
not know if that, in fact, is the signature.
It is a fax actually from Jonkers, LLC.
It is not from the school board itself.
As an alternative, if they're going to reference this letter as the
witness just stated in response to our foyer request, then the foyer request
should be put in --- place this letter in the proper context.
A. This letter was written after the
foyer request.
CHAIRMAN MCKINNEY:
I'm going to deny
the objection and we'll put this in for whatever weight it deserves.
(Old
Standard Exhibit Numbers 13 and 14 marked for identification.)
ATTORNEY MCDONALD:
I have no further
questions of Mr. Jonkers.
CHAIRMAN MCKINNEY:
Is there any other
need for Cross? You may step down. Thank you.
ATTORNEY
ROBERTSON:
The Staff has one
or two other questions. I'll be very
quick, Mr. Jonkers.
CHAIRMAN MCKINNEY:
Mr. Jonkers, I
guess you're still there.
RECROSS
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Mr. Jonkers, I'm not going to get
into the issues, but with the red line, what you call the red line version of
the Jefferson County Planning & Zoning Commission, for Sheridan
Development, was that to take the sewage that was going to be sent to Charles
Town to redirect it to the Old Standard place?
A. That's correct.
Q. And that was done, as you said, in
October of 2004?
A. No.
No. The approval from the
Planning Commission --- what happened was Mr. Rocco (phonetic), who's head of
planning, zoning and engineering, did not feel comfortable in accepting a
redirect of the sewage flow without authorization from the Planning Commission.
The Planning Commission voted to give him that authority. We supplied him with
the documents, and it has been processed and approved.
Q. And do you know approximately when
that date of that ---?
A. The actual approval?
Q. Yes.
A. July 6th.
Q. July 6th of?
A. 2005.
Q. 2005. So that's recently happened?
A. That's correct.
Q. So with Sheridan LLC, organizing in
2002, from 2002 up to July 6th, approximately July 2005, the intentions of the
Sheridan LLC from that time up to the July 2005 approval was to send the sewage
to Charles Town?
ATTORNEY MCDONALD:
Well, objection.
A. No.
ATTORNEY MCDONALD:
That question ---.
A. No, it was ---.
ATTORNEY MCDONALD:
Let me finish my
objection. Counsel is well aware of the
filing that was made at this Commission in 2003, pursuant to which the
developers of Sheridan would enter into an agreement with the Jefferson County
Public Service District for the PSD to build a treatment plant. So the question is based on a faulty
assumption.
ATTORNEY
ROBERTSON:
Well, let me move
on.
BY
ATTORNEY ROBERTSON:
Q. Mr. Jonkers, the only other thing, at
this particular time you are aware that at least --- I know your Counsel
brought it up, also that the Faulkners have filed a Circuit Court suit in
Jefferson County with the Planning and Zoning Commission?
A. They've filed so many suits, it's
just one of many.
Q. So you're unaware of that?
A. I'm aware of it.
Q. You're aware of it?
A. Yes.
Q. And is that --- do you know if that
proceeding is still pending at this time?
A. It just got filed, so yes. Their other suit got thrown out, but this
one is still pending.
ATTORNEY
ROBERTSON:
Thank you, Mr.
Jonkers. I still would reserve the
right to call Mr. Jonkers at a later time.
CHAIRMAN MCKINNEY:
Okay. Thank you.
Let's have a break. We'll expect you back at ten after 1:00.
LUNCH
BREAK TAKEN
CHAIRMAN MCKINNEY:
One of the things
I've noticed, since we've had only one witness on the stand and as the
extensive witness list was noted by Jefferson County, I would ask that you call
witnesses that only bring relevant and new information.
ATTORNEY MCDONALD:
Your Honor, the
parties have conferred and have agreed and would like to ask the Commission's
indulgence to take some witnesses somewhat out of order in order to accommodate
their travel plans. We've agreed that
the next witness will be Old Standard's Jason Allen, following him JCPSD's
Marty Kable. Following him, the Staff's
witness, Jane Arnett. I'd call Jason
Allen.
--------------------------------------------------------
JASON
ALLEN, HAVING FIRST BEEN DULY SWORN, TESTIFIED AS FOLLOWS:
--------------------------------------------------------
DIRECT
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. Would you state your name and
business address, please, sir?
A. My name is Jason Allen. My business address is 2404 Rutland Drive,
Austin, Texas.
Q. By whom are you employed?
A. Enviroquip, Incorporated.
Q. And in what capacity?
A. I am a support engineer/project
manager for the company, for the company's MBR division.
Q. MBR stands for membrane bioreactor?
A. That's correct.
Q. What business is Enviroquip in?
A. We're essentially a best available
technology provider for wastewater treatment.
Currently, the MBR group is --- we're the sole licensee for Kubota
membranes in North America.
Q. What responsibility do you have for
the Old Standard Wastewater Treatment Plant project?
A. Essentially I interact with a
national sales team of representatives.
I develop designs for preliminary proposals for clients that wish to use
our membrane products. If it goes
beyond that, I begin developing the purchase orders and support the regional
engineers on the project from start to finish.
Q. All right. Is that what you've done on the Old Standard project?
A. I'd say that pretty much describes
it.
Q. Would you briefly describe the
wastewater treatment plant that Old Standard has ordered?
A. Essentially they're getting a
membrane bioreactor plant. This plan
essentially, from our perspective, is going to cover everything from a fine
screen to the UV discharge. In between
those two points they'll essentially have three different process basins, an
anoxic basin, a peroration basin and an MBR basin. Essentially the bulk of the work is done in that MBR basin, where
wastewater is essentially filtered through a membrane cartridge, and that's how
we generate our client water. I think
that's about the easiest way to describe it.
Q. Would you describe this technology as
state of the art?
A. This is the best available technology
which is classified as state-of-the-art.
Q. Where been some talk already of the so-called Chesapeake Bay standards. Can you shed any light on what those are and
the role your plant will play in meeting them when they are determined?
A. It's my understanding that there's
two basic criteria for the proposed standards.
They're basically built around flow rate or flow capacity of the
plant. Old Standard is basically in the
short end of the permit restrictions.
They don't have to be as tight as some of the larger facilities. Basically what we look at are BOD, TSS,
total nitrogen and total phosphorus on discharge. Currently, this plant is less than five PPM on BOD and TSS, less
than eight PPM on total nitrogen and less than .1 on total phosphorus. And I think that probably best describes the
plant.
Q. Now, Chesapeake Bay standards have
not been established yet; is that true?
A. That's my understanding. They've been proposed, but not necessarily
adopted. And there's a tighter set of
restrictions for larger scale, larger flow rate plants.
Q. Do you believe that your plant is
capable of adapting to whatever standards are ultimately adopted?
A. I don't think there is an
adaption. We can meet or exceed any of
the regulations that are proposed.
Q. This is a 50,000-gallon-per-day
plant. Is it expandable? And please explain.
A. We were asked by the client to give
him a plant with initial capacity to handle 50,000 gallons per day and with the
capacity at some time in the future to extend that capacity up to 125,000
gallons per day average flow rate. And
that's essentially what we're designed for.
Q. So initially it will be filled for
50,000 gallons per day, but how much work will it take to expand it to 100,000
or 125,000 per day?
A. The initial phase, he'll have all the
equipment in lieu of membrane cassettes to handle the
125,000-gallon-per-day
flow rate. As his flow demand dictates,
he'll essentially call Enviroquip and say, I need more membranes, my flow rate
is going to go up by X amount, and we'll order the membranes that will allow
him to support that additional flow rate.
And essentially he'll take --- order those and drop the cassettes into,
you know, pre-erected assemblies in the basins, and he'll be able to go
directly to that demand flow rate.
Q. Have you provided me with photographs
of a similar MBR plant?
A. Yes, sir, I have.
Q. I'm going to hand you a photograph
that's not labeled or numbered, but we'll ask that it be marked for
identification as Old Standard next number.
Fifteen (15)?
(Old
Standard Exhibit Number 15 marked for identification.)
BY
ATTORNEY MCDONALD:
Q. I ask you to explain what I have just
handed you, please.
A. You've handed me a photo of an
existing facility in New Mexico, the Casa Blanca Wastewater Treatment
Plant. This is a sister project to a
Rio Puerto project. This plan is in a similar capacity and arrangement to the
Old Standard plant. And essentially
what you're looking at here is an MBR basin without any clean water or mixed
liquor in the basin. Each individual
unit here in the basin is actually an ES200.
It's a particular model of membrane that we offer. Each one of these membranes has essentially
200 plates per membrane.
Q. 200 plates per membrane?
A. 200 plates per membrane. Essentially, what you're looking at in the
basin is an MBR cassette. Within that
cassette there are multiple plates. A
plate essentially --- I think we have an example of one in the back room, but
essentially the plate is the actual surface --- it's the actual filter where
the mixed liquor will pass over one part of it. A pump --- a small suction head will be applied to that plate,
and then clean water will be pulled through that plate itself. And that's effectively the filter. What you're looking at here is part of the
construction. This plant was about two
weeks away from doing a clean water test.
It was in the process of having a mechanical check-out completed.
Q. All right. Here's another picture.
Is this from the same plant?
A. This is the same plant. And the reason this was given is it's a
similar --- we're going to be looking at something similar for the Old Standard
application. What you're looking at
here are two permeate pumps. These are
the pumps that will actually put a small pressure head on the membrane
cassettes themselves. They'll pull ---
they'll pull a suction head on the permeate plate. They'll pull clean water essentially through the plate and then
discharge it into these collection headers that are --- that the pumps
themselves are tied to, and then subsequently discharge to a disinfection
system, in this case, a UV disinfection system.
ATTORNEY MCDONALD:
Your Honor, may we
have this photograph marked as Exhibit 16?
CHAIRMAN MCKINNEY:
It will be so
marked.
(Old
Standard Exhibit Number 16 marked for identification.)
BY
ATTORNEY MCDONALD:
Q. Here's another picture of some
pipes. Would you explain the picture
that's now being handed out?
A. Again, this is also from the Casa
Blanca plant. This is just a different view of the same materials that we were
looking at in a different phase of the construction or the piping construction
and configuration. Essentially what
you're looking at here are the permeate headers themselves coming out of the
basin. If we go back to the first
picture, each one of these membrane cassettes --- if you go back to the first
photo you can see a gray tube that runs the --- that runs perpendicular to the
basin length. That tube then connects
to a hose that penetrates the wall.
That hose then penetrates a wall through a piping connection and then
connects to each of these permeate headers themselves that lay outside of the
basin. That's where your clean water is
going to be discharged. And essentially
it's discharged to this header, to the pump, from the pump to the disinfection
system.
Q. I'll hand you another photograph, a
picture of a guy on a ladder in the back.
Explain that photograph.
A. Again, this is just a different
view. Again, the same plant, Casa
Blanca, similar size. We're giving the
client essentially an indication on what could be considered as a building
configuration. Currently, this person
right now is working on the control system for the plant. In this case, he's working on a MCC control
center, which is a motor control center.
This center essentially is where you get the automated control of all of
your equipment. Via plant programming,
a computer will interlink with this MCC control and tell the plant that a pump
needs to be turned on. That's
essentially what this person is looking at.
Q. I'll hand you a photograph of what
appears to be a well with sinks in the bottom of it. What's that picture?
A. Again, this is also the Casa Blanca
plant. This was --- this precedes all
the photos that you've looked at thus far.
Essentially you're looking --- the foreground, the piece that's on the
basin floor is actually a diffuser bottom.
It's part of the MBR system. Up against the back wall is an actual MBR
unit that's wrapped in plastic.
Essentially that unit will be placed on top of the diffuser bottom. The unit that's to be placed on top of the
diffuser bottom is actually in the bottom of the picture, attached to a crane
lift assembly. That membrane cassette will be lifted, turned 90 degrees and
placed on the diffuser bottom. The drop
piping in this picture is actually your air piping. You'll have a supply side air that will discharge air into the
diffuser bottom. The diffuser then will
essentially direct airflow up through the membrane cartridges. This airflow is just a process-specific, I
guess, factor of the design.
Essentially the airflow will scour a biofilm that occurs on the plates
and also maintain the biology growth within the basin. The pipe on the left is an actual discharge
header. When we want to clean that
diffuser on the bottom of the basin without drawing down any water, we'll
essential open the valve on the discharge side, suck mixed liquor in through
the diffuser bottom, discharge it through the out-take side, and we essentially
have a maintenance-free diffuser.
ATTORNEY MCDONALD:
Your Honor, may we
have the photograph with the boxes on the pallet and the empty box on the shelf
marked as 17, the picture with the guy on the ladder marked as 18, and a
photograph that the witness just described marked as 19?
CHAIRMAN MCKINNEY:
They'll be so
marked.
(Old
Standard Exhibit Numbers 17, 18 and 19 marked for identification.)
BY
ATTORNEY MCDONALD:
Q. I hand you now what appears to be
another view of the assembly process.
Explain, please.
A. Again, this is correct. In this instance, essentially the client
needed to get --- they needed to treat demand flows as soon as possible. So what we did basically, after they got the
concrete poured and in place, we came in and started erecting the membrane
cassettes with the contractor so essentially they could get the plant on line
as quickly as they possibly could and begin treating flows. And often, the easiest way to do that is as
soon as the equipment --- or as soon as the concrete is placed and before the
building is erected, we go ahead and place the membrane cassettes. And then essentially as the equipment
check-out is completed, the contractor can essentially complete the building at
his leisure. And as soon as the
equipment check-out is completed and the permeate clean water test is done,
they can start treating discharge. So
this photo is just an extension of the photo prior to it. It just has all of the diffuser bottoms
placed, and they're ready to place the membrane cassettes themselves on the
diffuser decks.
Q. Finally, I hand you a photograph that
appears to be in the process of placing the membranes in a structure that did
not have a building around it. Explain
that.
A. Again, this is also the Casa Blanca
plant. This is just a different phase
of that construction, and it's just giving you an indication on what lifting
assembly might be required to lift one of these decks and place them into the
basin. And again, this is about the
same time that the preceding photo was used.
This would just be another membrane cassette deck being placed on top of
a diffuser bottom prior to the finished building construction.
ATTORNEY MCDONALD:
Your Honor, may we
have the most recent photograph marked as Number 21 and the one prior to that
Number 20?
CHAIRMAN MCKINNEY:
So marked.
(Old
Standard Exhibit Numbers 20 and 21 marked for identification.)
BY
ATTORNEY MCDONALD:
Q. Now, you have provided to Old
Standard, which, in turn, provided to the Staff certain cost estimates
throughout the course of this proceeding; have you not?
A. That's correct.
Q. And have you had further discussions
as this case has wound on with Lee Snyder about those costs?
A. Yes, sir.
Q. And are you in agreement that the
costs that he will prepare are supported by Enviroquip?
A. Essentially the --- there's been a
lot of discussion with Lee Snyder and Enviroquip. Essentially the balance of the material that he has, we helped
develop with Lee. We gave him the
initial numbers. He's had some --- he's
essentially initiated some changes which we would stand behind.
Q. Thank you.
ATTORNEY MCDONALD:
Your Honor, that
concludes my Direct Examination. The
witness is available for Cross Examination.
CHAIRMAN MCKINNEY:
Thank you.
CROSS
EXAMINATION
BY
ATTORNEY KELSH:
Q. Mr. Allen, just a few quick
questions. This plant is going to serve
a subdivision which currently has zero homes built, expected to expand over
three years to about 180 homes. Are
there any particularly difficult to overcome operational problems for this
plant when it receives a low volume of flows?
A. If a low volume of flow is 25 gallons
a day, then yes. If it takes two months
to fill a process basin prior to the MBR, then yes. If a low flow meaning that I only get 5,000 gallons a day, you
know, in multiple batches, with the flow that's, you know, rated at --- that's
about ten percent of the flow capacity, then I would --- I'd say no.
Q. Okay.
A. Essentially, if we had mixed liquor
in the basins, we had operating mixed liquor, concentrations that we've
designed for, we can essentially operate without an influent to the plant for
as long as 30 days.
Q. Okay. Does a low-flow situation imperil the quality of the effluent?
A. In this case, no. If you're looking at a larger plant, say a
million gallons per day, and you're only getting 2,000 gallons per day and you
have to meet the more strict discharge limits of the Chesapeake Bay watershed
standards, then potentially. When you
have to go down to a 3TN, you have multiple process basins, then potentially we
would have to redesign some of the preliminary functions of the plant. We may need to dose with a carbon source,
for instance. We may need to redirect
plant flows to different process basins.
They're not going to cause problems.
What they're going to essentially do is dictate operational protocol.
Q. So is it fair to say that they're
problems, but they're problems that you've encountered before and they can be
overcome?
A. Right. As long as we have good information from the client, giving us
the exact expected flow rates, and we do get that, we do see that in the field,
then yes, we can manage those flow rates.
Q. You know, a wastewater plant is
obviously going to receive wastewater.
Is there any local water or other water that is used in this process?
A. There's no potable water required
for, let's say, pump seals or anything else.
The only water that's used in this plant outside of the process is water
that would be used to wash down the fine screens. And we can actually use permeate to do that. So I can run a hose line off of my permeate
discharge line prior or after the disinfection system and actually run plant
water back for that. I don't need a
potable water supply for my system, but the state may require potable water for
an eye wash. But as far as for my system, I don't require a potable water
source.
ATTORNEY KELSH:
Thank you. That's all I have.
CROSS
EXAMINATION
BY MR.
FAULKNER:
Q. What is the overall dimensions of the
facility in Casa Blanca, the footprint on the ground?
A. I can't tell you. I don't know that off the top of my head,
but it's marginally similar to what we're looking at for Old Standard. And if you want an assumed footprint, I'd
say under 50-by-70, and that's including the building. And that's just a guess.
Q. Okay. That's fine. And in terms
of the three basins, about how deep are they?
A. The basins are going to run similar,
so no more than 12 feet deep.
Q. Is that all above ground or do you
excavate into the ground?
A. You can do it either way.
Q. How much sludge does a --- would a
plant generate, especially a 50,000 gallon plant?
A. The sludge production is going to
vary depending on BOD concentration of the influent, the volume of flow coming
to the plant, the mixed liquor operating condition point for the plant and the
plant SRT. So there's no real --- you
know, you'd have to give me real numbers on what I'm to design for and I'll
give you numbers for that.
Q. In the Casa Blanca plant, is it
operational?
A. The Casa Blanca plant is operational.
Q. So what is your experience in ---?
A. I don't have anything to do with the
Casa Blanca plant. That's outside of my
region, and I don't have real numbers for that.
Q. Okay.
A. I mean, I can talk about projections
on something I've done, if you want to do that.
Q. Well, have you done a similar-sized
plant of the 50,000 to 125,000 range?
A. Yes.
Q. And what is the sludge --- and I
guess how often does the sludge have to be cleaned out?
A. Well, it really --- the frequency on
cleaning the --- or disposing of the sludge is really up to the operator and up
to the storage quantity. And generally
that's developed, you know, under regional jurisdiction. Depending on if you're
going to land apply the sludge, if you're going to do something else with the
sludge, that's a regional application.
I think in this situation, around 25,000 gallons with a very heavy
loading, 435 BOD PPM on the BOD, you're operating at a high mixed liquor
concentration, you can look anywhere from about 12,500 to 30,000 gallons per
month. But it really depends on what
you're looking at, on the flow that you're looking at, on the SRT, on the mixed
liquor concentrations and the BOD concentrations.
Q. Do any of your plants handle
industrial waste?
A. Yes, we do.
Q. Does that require any additional
modification for the plant?
A. No.
Industrial loadings --- what we consider industrial loadings generally
are loadings above 1,000 PPM BOD.
You're never going to get near that for one here. And the 435 that we designed for we believe
is over --- is an over design anyway.
However, if you do get into industrial loadings, especially loadings
that have high calcium concentrations, loadings that are going to cause
potential scale on the membrane pipe themselves, what we generally do is we
back off on the flux rate. And
essentially what that means is instead of giving you five membranes to do at a
specified flow rate, I'm now going to give you seven membranes to do at a
specified flow rate. But essentially we
don't --- I mean, we've handled --- I've handled designs that have in excess of
15,000 PPM BOD as far as an industrial load.
But essentially what we're doing is we're pulling off for flux
rate. Generally the flux rate is what
we design for on all of our plants, and it's based on temperature. If I have a nine-degree C temperature minimum
operating condition point in the winter, that's going to dictate my flux rate. That's going to dictate my hydraulic
capacity. With industrial, although
we're pulling back some of our flux, most industrial plants have a higher
influent temperature. So they're
anywhere in the range of 40 degrees C --- you know, as high as 40 degrees
C. So although we're pulling back our
flux rate, in comparison to a domestic plant there's not much difference in
hydraulic capacity.
Q. I'm thinking beyond that. Are there any chemicals that might be
generated by any industrial output that the membrane is --- is outside of its
stratus?
A. The only types of chemicals that
you're going to have to worry about are generally solvents and solvents in and
above beyond what's in the domestic supply anyway. Solvent concentrations have
to be very, very high, and that's about the only thing that we would run into a
problem with.
Q. About how many plants currently of
this type are in operation in North America?
A. I can tell you within the next year
they'll be close to 100 in operation in North America.
Q. And have any of them had any
violations of pollution permits to date?
A. Our company has not had any. We have had no violations whatsoever. We've had no catastrophic plant failures.
MR. FAULKNER:
That's all the
questions.
CROSS
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Good afternoon, Mr. Allen. With the
50,000-gallons-per-day
plant that you designed on behalf of Old Standard, was it my understanding that
the phosphorus levels didn't possibly meet the current Chesapeake Bay
requirements?
A. Yes.
It's my understanding .1 is what our target was on phosphorus, that we
would meet the current levels. We can
go down below .03. So if there was a
change, we can go even below that phosphorus limitation.
Q. All right. And this has a provision that eventually this plant can expand up
to 125,000 gallons a day for flows?
A. That's correct.
Q. Do you know that that changes the
phosphorus level or what has to be occurring at the 125,000 gallon flow level
---?
A. It's just a dosing rate. You're going to get the same effluent
discharge. You're going to get the same
.1 on discharge. It's just a dosing
rate for ferrichloride or alum dosing in the anoxic is going to increase as the
flow demand increases.
Q. So basically you would, excuse my
ignorance with some of the chemical terminology, but that means you have to
increase the dosage of a particular chemical to offset the phosphorus level?
A. Well, you're not offsetting. I mean, essentially you're trying to remove
more phosphorus. So in order to get to
that, you're going to have to add more chemical to make that happen. Now, subsequently, we can go to a different
--- you know, we have a different scenario that we can use, and that's not
something that we need to do on this plant because the tight regulations aren't
there, but we can chemically get rid of phosphorus as well as --- by adding
chemicals as well as by getting biological uptake in the process. So we can do both. We can do it by biological uptake, not add chemical, or we can add
chemical, or a combination of the two.
Q. With this particular plant that you
designed, is it going to require a full-time sewer plant operator?
A. These plants were designed so that
--- I mean, and I'm going to speak frankly here. If we put this plant together, we got through the clean water
test, we got three set point conditions for the flow that we're getting at the
plant, I can run it from my desk at home in Texas. I don't need to have someone here every week. I need someone to
come out once a week and empty the trash that comes from the screens and to
spray the screen box down. Other than
that, I really don't --- I mean, I can set the plant up and run it at
home. I mean, that's what this plant
was designed for in Japan and subsequently in Europe.
Now, what ends up happening is
that each municipality around the country has its own classification for how
often a plant operator should be at the plant.
Some of the plants that your folks have come down to see in Atlanta, if
that guy didn't have grass to mow, a building to paint, he wouldn't have
anything to do at the plant on a day-to-day basis. But the state requires that he be there four to six hours per
day.
Q. And so there could be similar state
regulations that would have to have a plant operator there so many hours a day?
A. That's correct, but I'm not privy to
those.
Q. Right. Looking at the procedure and what you showed us with the
particular pictures of the Casa Blanca plant, what is actually the start-up
procedure once this is constructed?
Could you just explain briefly?
A. Essentially the start-up protocol is
going to dictate a changeover from project management to our start-up
division. Once the project management
group comes out and does chemical check-out, maintains that all the interconnecting
piping was done correctly, that all the rotating equipment has been installed
correctly and in working order, then the start-up group is going to come
out. That start-up group is going to
sit down with whoever has been selected to do the plant operations. They're going to sit down with him and do a
training session for a couple of days with any potential plant operators. After that training session, then we're going
to do what's called a clean water test.
We're going to fill the MBR basins with clean water and we're going to
pull permeate, although off of clean water, we're essentially going to
establish a fixed point permeability number at the plant. And then we'll start essentially integrating
with the operator how to work the plant with clean water. After the clean water has been --- the test
has been completed, then the client is going to bring in some seed sludge. The seed sludge will be introduced into the plant. After the seed sludge has been introduced,
we get the seed sludge working, we're going to start taking raw influent into
the plant.
Q. Let me just ask you at that
particular point in time. So then this
seed sludge that you're talking about is sort of trucked in?
A. That's correct.
Q. So it's not like you're hooking up
individual customers, making a test run, ---
A. No.
Q. --- you're bringing in ---?
A. Generally speaking, you will truck it
in.
ATTORNEY
ROBERTSON:
Thank you, Mr.
Allen.
CHAIRMAN MCKINNEY:
Any Cross?
ATTORNEY MCDONALD:
No Redirect, Your
Honor. Your Honor, may the witness be
excused from further participation in this hearing?
CHAIRMAN MCKINNEY:
If I hear no
objections.
ATTORNEY
ROBERTSON:
I was just going
to rise up and say that Staff has no objection to excuse Mr. Allen.
CHAIRMAN MCKINNEY:
So
be it.
ATTORNEY MCDONALD:
Thank you.
ATTORNEY KELSH:
Commissioners, by
agreement the District has been permitted to examine one of its witnesses out
of turn. I'd like to call Marty Kable
to the stand at this time.
--------------------------------------------------------
MARTY
KABLE, HAVING FIRST BEEN DULY SWORN, TESTIFIED AS FOLLOWS:
--------------------------------------------------------
DIRECT
EXAMINATION
BY
ATTORNEY KELSH:
Q. Mr. Kable, could you spell your name
for the court reporter?
A. Last one?
Q. Yes.
A. K-A-B-L-E.
Q. All right.
A. And it's Harry M., initial. Also go as Marty, M-A-R-T-Y.
Q. And Mr. Kable, are you the chairman
of the Jefferson County Public Service District?
A. Yes, I am.
Q. And are you a life-long resident of
Jefferson County?
A. I am.
Q. In the last few years has the
District been approached by many developers and many prospective customers for
service?
A. Yes.
Q. What has the District's response to
those requests been in the last year and a half or so?
A. That we have to put them on a waiting
list, an ever-growing waiting list because we're, in essence, in an undeclared
moratorium.
Q. And these prospective customers, they
want to build new buildings in Jefferson County, I presume?
A. Yes.
Q. New businesses?
A. Yes.
Q. And you're familiar with the
circumstances in Jefferson County generally; are you not?
A. Relevant to the growth?
Q. Yes.
A. Yes.
Q. Are you aware of any factor as significant
as the lack of wastewater capacity that is adversely affecting prospective
commercial and residential growth?
A. That is the biggest issue that we
have that has stymied our growth for residential and also for our industrial
parks. It's quite an issue there that
we're losing revenue by their not being able to move ahead with people that
want to come and relocate into our industrial parks.
Q. There's a lot of residential growth,
but you think there might be a greater commercial growth and a greater
employment growth in Jefferson County if there were more wastewater capacities?
A. Very definitely so, yes.
Q. Do you believe --- well, let me back
up. What wastewater treatment plant
does the district rely upon now for wastewater treatment?
A. All of our flows go to the Charles
Town Wastewater Treatment Plant.
Q. Looking at the expected growth in
Jefferson County, do you believe that continued reliance upon that one plant
will enable the District to meet its obligation to serve throughout Jefferson
County?
A. No.
Q. So I take you think that additional
wastewater treatment plants are needed in Jefferson County. Can the District qualify for grants from
federal or state agencies?
A. No.
Our high median income for our area, the eastern panhandle, negates our
being --- to receive grants of that nature.
Q. And the District's current rates, how
much does an average residential customer pay approximately for a month of
wastewater service from the District?
A. I think that's around $50 or a little
better, yes. We have very high rates at
this point.
Q. Does that limit your ability to
borrow funds to meet the wastewater treatment needs in Jefferson County?
A. Yes.
If we were to go out and borrow funds to construct collection lines and
wastewater treatment plants, I'm sure that our rates would exceed the amount
that would be acceptable.
Q. So under the circumstances you've
described, is the District receptive to the possibility of receiving donated
facilities from private entities?
A. Yes.
Q. And has the District been in
negotiations with these private entities over time?
A. Yes, we have, for the last year and a
half approximately.
Q. What do these private entities want
for their investment?
A. They want to build the
infrastructure, the collection lines, wastewater treatment plant, for the
opportunity to use the capacity of that plant for their own use. And in some cases, as we're discussing here
now, there would be excess EDUs over and above what is being planned for for this
particular development.
Q. Now, you used the term EDU. Can you explain what an EDU is?
A. It's equivalent to the amount of
water or discharge from a dwelling unit.
Equivalent to a dwelling unit.
Q. And do you know approximately how
many dwelling units this plant that Old Standard is willing to donate is
capable of serving?
A. I think that's 331, I believe.
Q. And how many homes does Old Standard
want to receive service in the Sheridan development?
A. 178, I believe.
Q. So they've provided a bigger plant
than they really needed to do; is that fair to say?
A. Correct.
Q. In this circumstance, do you think it
would be appropriate to permit the entity that donates the facilities to have
access to some restricted capacity?
A. Yes.
As I've said, that's what the developer will request or they're not
going to move forward with building something that they're not going to have
for their own use.
Q. And what's your understanding of
restricted capacity?
A. That amount of capacity that the
developer is willing to --- that he wants back or a guarantee, if you will, to
have those EDUs for his project.
Q. And the opposite of that would be
unrestricted capacity. And what would
unrestricted capacity be?
A. Then that could be used for someone
else in that locality or, in this case, if the school so elects to remedy their
situation with their septic system, then that could possibly be available for
that entity.
Q. In order for the District to give a
developer restricted capacity, what would it expect in return?
A. What would the District ---?
Q. What would the District expect in
return?
A. Well, they'd want to have that amount
in the project, and then that would just be donated, as I understand it, to the
Public Service Commission --- to the Public Service District as a capacity that
we could use and benefit from, you know, with other customers. It would raise the customer base for us.
Q. So the District would be willing to
give a developer who donates facilities restricted capacity if they give some
unrestricted capacity as well?
A. Correct.
Q. Are you familiar if this is an
approved concept in West Virginia or not?
A. I think this is a first. I think you're on the cutting edge. But I think it's a great means of developers
or anyone --- we keep using the term developers. It could be anyone. I'm
in the farming business and have farms that are in the locality that could be
developed. So I, as a property owner,
could come forth with this type of agreement to have --- to proceed with
developing of one's own property. It
doesn't have to be some developer that came in.
Q. Or it could be an industrial park
tenant?
A. Yes.
Oh, yes. Yes.
Q. Do you think that this concept holds
a lot of promise for the District in order to assist it in meeting its duty to
serve the county?
A. Yes.
I think this is a great approach and where the developers --- and
they're quite willing. I've just been
amazed at how the developers have come forth and just say, what do you want us
to do, when can we do it, you know, how can we do it. And this approach allows them to move forward with a
public/private agreement which starts with our board in the agreements that
have been discussed and future agreements that will come forth in the future
from various entities.
Q. Now, if the District were to grant a
developer restricted capacity and the Commission were to approve that concept,
say that the development is a bomb.
They've been out there trying to sell houses. Nobody wants to buy their houses. Would you favor, you know, sort of a limited timeframe for this
restricted capacity for the developer?
A. Yes.
I think you would want to look at the size of the project and the
phasing of that project would come into play in figuring how long you'd want to
make --- require them to guarantee the economics of the project.
Q. Okays. This project, do you believe that once the District takes
ownership of this facility and operates it, do you think this will enhance the
District's financial position?
A. Yes.
Very definitely.
Q. It will help it forestall any further
rate increase?
A. Yes.
Q. Do you have any additional
information you'd like to present to the Commission today?
A. Only that I think, as I've mentioned,
that you're on the cutting edge with this project, and I think it's a great benefit
to enable our county, Jefferson County, one of the fastest-growing counties in
the state, if not the first, to move ahead and provide adequate wastewater
treatment capacity. Or this can be used
for water sources, also. But it would
enable us to move forth in a positive way to expedite the situation that we're
in. It's not been a pleasant situation
this past 18 months being in an undeclared moratorium situation, where your
hands are virtually tied and with all the influx of the development that has
come forth with our being flanked by Virginia and Maryland. And I think it's just a great opportunity
for us to do that.
The other thing, as I've
mentioned, our industrial parks were stifled somewhat with the highway
situation, where they're located. And
Route Nine, which connects us with Interstate 81, is being built. Dirt is moving as we sit here. And now they're stifled with no wastewater
treatment capacity. So there's a golden
opportunity that is --- they're trying to hand onto with the amount of
applicants they have that want to move in here with viable job-producing
entities. So I'm excited about the
project. I think it's workable. A lot of people are skeptical of it. Every one of these projects will start at
our monthly Public Service District meetings.
There's not going to be anything hidden from anybody. Our agendas are announced. And so that's where the project starts and
the agreements are drawn. And it has to
meet our board's criteria before it moves any further and then comes into play
with the various agreements that we'll be getting into, as you all have
reviewed before now.
Q. Mr. Kable, a couple times in your
testimony you referred to an undeclared moratorium. I'd like to review that situation a little bit for the benefit of
the Commission here. Around --- I think
it was December of 2003, did the Bureau of Public Health stop issuing permits
for subdivision collection systems in Jefferson County?
A. Yes.
Q. And that was for anyone who's tied in
--- who was going to have their wastewater treated in Charles Town Plant;
correct?
A. Correct, relevant to that plant's
lack of capacity.
Q. And did Charles Town work out an
understanding with the Bureau of Public Health and DEP?
A. Yes.
All three entities did. Charles
Town and Ranson and the District came to those agreements, yes.
Q. It's my recollection, and please
confirm if this is consistent with your recollection, that DEP and the Bureau
of Public Health said that there's about 150,000 gallons capacity remaining at
the Charles Town plant as of March 2004.
Does that sound right?
A. Correct.
Q. And the District filed a moratorium
case here at the Commission; did it not?
A. Yes.
Q. And the parties to that case ---
there are several developers who are parties to that case, Charles Town, Ranson
and the District were parties. Did they
file a stipulation with the Commission in settlement of that case?
A. Yes.
Q. And that stipulation provided for a
certain allocation of EDUs among the three entities. I think Charles Town got about 240 and the District got about
220?
A. Yeah. Them are all figures, but it was allocated out, yes.
Q. And that was filed with the
Commission. And I think an ALJ approved
that by a recommended decision?
A. Yes.
Q. And then you're familiar with the
Holiday Inn Express in the area?
A. Yes.
Q. Did the Holiday Inn Express file
exceptions to that recommended decision?
A. Yes.
Q. And then it's been pending before the
Commission ever since?
A. Correct.
Q. And I think the recommended decision
came out in like the fall of 2004. Does
that sound right to you?
A. That would be about the right
timeframe, yes.
Q. And even though the Commission hasn't
finally approved that, I mean, the exceptions are still pending before the
Commission, I believe, the parties have been operating under that stipulation;
have they not?
A. Who did?
Q. Charles Town and the District.
A. Oh, yes. I thought you meant the Holiday Inn Express. Yes, we've been operating under the --- yes.
Q. There's not really another alternative
to doing so, is there?
A. Correct.
ATTORNEY KELSH:
Thank you. Some others may have some questions.
MR. FAULKNER:
No questions.
ATTORNEY MCDONALD:
No questions, Your
Honor.
CROSS
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Good afternoon, Mr. Kable. Can you actually tell me from the District's
perspective what has actually created the current sewer situation?
COMMISSONER SHAW:
Has created what?
ATTORNEY
ROBERTSON:
The current sewer
situation.
A. If you could speak up a little bit,
I'd appreciate it.
BY
ATTORNEY ROBERTSON:
Q. Sorry about that. I can speak up. I was looking at in the District's perspective what has created
the current sewer crisis?
A. Well, lack of activity by our
previous boards. I'm not sure what all
happened there, but nothing happened.
And it is haunting us today.
Plus the great influx of home buyers and developers and builders that
have come to Jefferson County from the Maryland and --- northern Virginia and
Maryland. And land prices have escalated
greatly. Properties are changing hands
quite frequently, being bought by --- for development purposes. And the old adage, we're just behind the
eight ball at this point.
Q. Actually, can you tell me as either
the chairman or a commissioner of the Public Service District, when did you
take office as one of the board members?
A. In my three and a half years of my
six-year tenure, and when was it, Sue --- when did you come? May? Okay.
So it was the beginning of the year of that.
Q. So have you had an opportunity to
also discuss with Sheridan Development or LLC about what Staff is looking at,
its proposal to run a line from the Sheridan development over to the
Breckenridge Pump Station?
A. Yes, that's been discussed.
Q. Can you expand on that?
A. I think it would be money ill
spent. I'm not in favor of pumping any
of these flows clear up a watershed, sewer shed, if you will, and with all the
lift stations and so forth that you go through to what I foresee as a future
limited capacity at the Charles Town Wastewater
Treatment
Plant.
Q. And is that the understanding that
the route that you understand would be going from the Sheridan development down
to the Patrick Henry weigh pump stations and up to the Breckenridge Pump
Station?
A. Well, you want to use up on both of
those. Both of those are upstream. And yes, that's the route that I understand
that they would be considering. And of
course, going to the Breckenridge, that pump station is already at capacity.
Q. Also, hasn't the District's engineer
also looked at possibly running a line from where the Sheridan is located due
west, in a westerly direction, to the Breckenridge Pump Station?
A. I think that's been proposed or at
least thought out, but that's --- nothing concrete on doing that.
Q. So the District has really not
pursued a complete investigation of that particular route?
A. No.
ATTORNEY KELSH:
I object. I think that's a presumption.
A. That's not true.
BY
ATTORNEY ROBERTSON:
Q. Well, then can you tell the Commission
some of the findings ---?
ATTORNEY KELSH:
Your Honor, we've
identified a witness, Will Smith, who can speak extensively to this issue.
ATTORNEY
ROBERTSON:
I'll defer to Mr.
Smith.
A. Okay.
BY
ATTORNEY ROBERTSON:
Q. Are you, at this particular time,
currently in the process of working with the City of Ranson concerning the
Flowing Springs Pump Station?
A. Yes.
Q. Can you explain to the Commission
what discussions and the reasons for the Flowing Springs Pump Station?
A. The Flowing Springs Pump Station is
to accommodate the large amount of building or EDUs that are being produced
upstream from the Breckenridge Pump Station area, up towards the Route Nine
bypass, if you will, that's what we still call it, area of our county. And that, in essence, is being paid, here
again, by the developers that are involved in those projects. Now, that --- pumping from that area into
Charles Town is the thing to do for a quick fix of this situation but not for
long term. In my estimation, some year
that needs to be turned around and go downhill in the watershed.
Q. Do you know, with the Flowing Springs
Pump Station, when its completed, the construction, of how that would also
affect the Breckenridge Pump Station?
A. We have an agreement with them to
provide some flows. Initially they need
--- I can't remember all the figures.
They need X amount of flows so that they don't run into a septic
situation before the small, initial flows get to the Charles Town plant. So we have an agreement in place where we're
going to divert flows to them for that purpose.
Q. And those diversions of flows are
from the Breckenridge Pump Station?
A. Yes.
Q. So then that will allow additional
capacity at the Breckenridge Pump Station?
A. To some degree.
ATTORNEY
ROBERTSON:
Thank you, Mr.
Kable. I have no further questions.
ATTORNEY KELSH:
I just have a
brief Redirect, if I may.
REDIRECT
EXAMINATION
BY
ATTORNEY KELSH:
Q. Mr. Kable, the Staff heard me ask you
about diversion of flows from the Breckenridge Pump Station to the Flowing
Springs transmission line. Do you see a
growth coming --- customer growth coming into the District's upstream of the
Breckenridge Pump Station?
A. Yes.
And I want to go ahead and expound upon that. Yeah, that is just going to be a very quick-fix situation there
at the Breckenridge station --- Breckenridge Pump Station. But those flows that are going to be
relieved there are going to be very quickly replaced and then multiplied in the
future.
ATTORNEY KELSH:
Thank you.
ATTORNEY
ROBERTSON:
Excuse me. I have one or two questions just on Redirect
(sic).
RECROSS
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Mr. Kable, looking at that as more of
a temporary situation, you were talking, too, about reversing flows. Where would you within the District reverse
the flows to?
A. Somewhere downstream on the Flowing
Springs watershed.
Q. Would that happen to be at the Old
Standard plant that you will be taking over?
A. Possibly.
Q. Then does the District have any other
plans to build its own plant at this particular time?
A. We are right on the threshold of
making that decision from our recently-presented facility plan study.
Q. So these reverses of flows could go
into the District's plant or possibly, an alternative, it could also go back to
the Old Standard plant?
A. Yes.
ATTORNEY
ROBERTSON:
Thank you.
ATTORNEY KELSH:
If I may. I apologize for the
back-and-forth
here.
REDIRECT
EXAMINATION
BY
ATTORNEY KELSH:
Q. Mr. Kable, you testified that you're
on the threshold of possibly selecting a treatment plant for the District to
build?
A. Yes.
Q. Do you have a feel for the timeframe
for that process, from you know --- of course, we have to be talking very
rough, ballpark figures, but from today, how soon do you expect the District
will have a plant underway?
A. Probably three years minimum.
Q. Thank you.
ATTORNEY
ROBERTSON:
I have no Redirect
(sic).
CHAIRMAN MCKINNEY:
Thank you. You may step down.
ATTORNEY KELSH:
Your Honor, I'd
ask that this witness be permitted to catch his flight at 5:30 today.
CHAIRMAN MCKINNEY:
Thank you.
ATTORNEY
ROBERTSON:
At this particular
time, still out of order, but all the parties have agreed that the Staff would
like to call Jane Arnett to the stand.
--------------------------------------------------------
JANE
ARNETT, HAVING FIRST BEEN DULY SWORN, TESTIFIED AS FOLLOWS:
--------------------------------------------------------
DIRECT
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. For the record, could you please
state your name and also your position with the City of Charles Town?
A. My name is Jane Arnett,
A-R-N-E-T-T. I'm the city manager for
the City of Charles Town, also serving as the chairman of the City of Charles
Town Utility Board, which operates the water and sewer utility.
Q. So then you're familiar with right
now the current Charles Town upgrade to a sewer plant?
A. Yes.
Q. And at this particular time could you
tell the Commission --- they have already approved the upgrade and I believe
that was in Case Number 04-0095-S-CN.
Could you give the Commission a status update as to your sewer treatment
plant upgrade at this time?
A. The contract has been let for the
expansion of the City of Charles Town Wastewater Treatment Plant, with completion
anticipated on January 8th. Substantial
penalties will be applied January 9th.
We are also working with the contractor to put in place a large portion
of that project that would allow the DEP to consider additional flows coming to
the plant sometime in December, optimistically December 1 of this year.
Q. So from that particular statement,
would DEP --- that you would possibly make a request of taking a portion of
that approximately 500,000 gallon flows and trying to get some of that released
early?
A. Yes.
Q. With the --- and you possibly have on
the horizon right now also what we would call --- at least the Staff has called
a fourth basin project?
A. Yes.
Q. And have you --- the City has looked
at or are looking at employing an engineer to start a design or looking at a
preliminary study of that?
A. The preliminary design task order is
slated for approval this month. And
that project is not a difficult one to design and engineer, so it is possible
to get that one moving quickly. But
perhaps --- as Mr. Kable said, it's a minimum of three years to approve any
project in Jefferson County. That's
basically the norm. So any project
started today would certainly be, in all likelihood, 24 to 36 months minimum to
complete.
Q. And with that particular project do
you know possibly what is the tentative upgrade for that fourth basin as to
number of gallons, the flows themselves?
A. Not being an engineer but having a
little bit of understanding of that additional basin, it would be more than
550,000 gallons. But that's an
approximate gallon increase.
Q. I know Mr. Kable also was talking
about being behind the eight ball.
Right now do you think that the City of Charles Town is trying to get in
front of the eight ball, is trying to stay ahead of the game and sort of
looking at connections for sewer?
A. How about the nine ball? I think we're all trying. Certainly there are tremendous pressures on
a small 1.2 MGD wastewater treatment plant to address the needs of the greater City
of Charles Town, City of Ranson and Jefferson County area. The magnitude of the growth and the onset,
as rapidly as it has come, has not been easy to address. Your question of getting in front of the eight
ball, but we certainly try our best every day. And we do have plans. The difficulty is, as I've heard very
limited discussion, how do we pay for it, who's going to pay for it, who
protects the end rate payer from paying for all this growth. And I think those are issues that we're
trying to face today.
ATTORNEY
ROBERTSON:
I want to present
a document, and I'll have this identified as Staff Exhibit Number Two.
(Staff
Exhibit Number Two marked for identification.)
BY
ATTORNEY ROBERTSON:
Q. While I'm passing out these other
documents, you may just want to read that.
WITNESS
COMPLIES
BY
ATTORNEY ROBERTSON:
Q. Have you had an opportunity to
refresh your memory with this document?
A. Yes.
Q. And can you just identify this
document and the purpose it was drafted to Mr. Weimer here at the PSC Staff?
A. My understanding of the purpose of
this letter was to initially support the Staff's proposal to allow flows
initially to come from Sheridan into the Breckenridge Pump Station to the
Charles Town Wastewater Treatment Plant until such time as there was a
sufficient customer base to absorb the building of the Old Standard facility.
Q. And that would also talk to if
District built a plant up in the Flowing Springs area?
A. I haven't considered that.
Q. But that's another potential?
A. That's a potential, yes.
Q. And this was actually --- this was a
letter written by you?
A. Yes.
Q. And this would actually --- and it
has a date of July 12th, 2005. This
letter was actually sent for the first Commission hearing, is that correct, for
the first Old Standard hearing that we had rescheduled?
A. Yes.
Q. At this particular time, looking at
that potential for a diversion of flows from the Charles Town plant of either
going to Old Standard or even going to the District's new plant, what is the
city's or your own vision of how that diversion would happen?
A. Certainly in my discussions with PSC
Staff it has been understood that it is engineeringly feasible. I believe it is theoretically possible ---
the City of Charles Town, without being a party to this case, has not had the
benefit of doing any financial analysis to determine the financial impact on
either the capital costs or the operations and maintenance costs at the City of
Charles Town Wastewater Treatment Plant.
Having said that, we certainly support Staff's position or the
Commission's position with regard to a decision and want to work towards a
regional approach to Jefferson County's wastewater needs. So I think that with the benefit of
financial oversight or some financial analysis, that that element, as well as
the engineering or the theoretical, would be supported. And again, certainly, as my responsibilities
to bond holders, investment bankers, bond insurers, I would want to make sure
that this is financially sound to suddenly cause wastewater to flow into
Charles Town and at some point in the future to divert it. It would just require some financial
analysis. And I would also want to look
at the Memorandum of Understanding with regard to wastewater treatment ---
sorry, waste --- capital improvement fees as they relate to wastewater. There is a memorandum of understanding
between the District of Charles Town and Ranson, for those fees to be applied
to any upgrades at Charles Town, allowing for provisions that the Commission
has approved that would divert those fees or credit those fees if, at some
future point, those flows would be diverted from Charles Town. So that would have to be included in the
financial analysis.
Q. So looking at the financial analysis,
if that financial analysis --- what I'll say that it's okay for Charles Town to
divert sewage flows, then do you think that it would be more encouraging to do
it?
A. I think that it would be possible,
yes.
ATTORNEY
ROBERTSON:
At this time could
I --- Staff take about a three-minute break or five minutes, if that's okay?
CHAIRMAN MCKINNEY:
Let's take a
15-minute break. Let's be back at
quarter to 3:00.
ATTORNEY
ROBERTSON:
Okay. Thank you.
SHORT
BREAK TAKEN
BY
ATTORNEY ROBERTSON:
Q. I'm just going to ask you one
question just to get us back on track. I'm
looking at the letter that you have here, the July 12th, 2005 letter, written
to Mr. Weimer, here at the Commission.
Basically we're looking at subject to financial calculations and things
at a later time, possibly or probably Charles Town would not have a problem of
diverting flows from its Charles Town sewage treatment plant.
A. Well, I think this more specifically
says diversion of flows from the Breckenridge Pump Station.
Q. Okay. But that is looking at the Breckenridge Pump Station?
A. That's correct.
Q. And also expanding on this particular
letter, subject to financial calculations, that you, as the city manager, that
possibly or probably that the City of Charles Town would not have a problem
with diverting sewer flows from --- that's directed --- that's treated by the
Charles Town sewer treatment plant and diverting those sewage flows?
A. Certainly I think that's possible and
probable, but subject to financial analysis.
Q. I believe I have one last
question. Looking at your current
upgrade with the treatment plant for the sewer, I'd note there's a couple of
complaints. But if you're able to do
that 500,000-gallon upgrade, at least you have the capabilities to also serve
this Sheridan development?
A. Yes.
Q. Thank you.
MR. FAULKNER:
Just one question.
CROSS
EXAMINATION
BY
MR. FAULKNER:
Q. Ms. Arnett, where is the current
pattern of need in the county, from your perspective as an administrator for
Charles Town, in terms of where the growth is currently?
A. Certainly those developments that
have been previously approved both in Charles Town and Ranson are the focus of
wastewater needs, wastewater capacity, consumption. And I guess from a Jefferson County perspective, again, those
that have been approved by the Planning Commission would be presumably ---
already have been looked at with regard to infrastructure and meeting those
infrastructure needs.
Q. Thank you.
ATTORNEY KELSH:
I have some
questions for this witness if Mr. McDonald does not have any.
CROSS
EXAMINATION
BY
ATTORNEY KELSH:
Q. Ms. Arnett, quickly give the
Commission an idea of the magnitude of growth in Charles Town. How many sewer customers do you have now,
approximately?
A. I'm going to say 6,800, plus or
minus. 6,600 to 6,800 customers.
Q. That's counting the District of Ranson
as well?
A. Yes.
Q. How many does Charles Town have? How many do you direct bill?
A. Just a little over 1,500.
Q. And Charles Town recently annexed a
development known as Huntfield; correct?
A. Correct.
Q. What's the total build-out of Huntfield
in terms of houses?
A. The planned build-out just with
houses is 3,200 homes.
Q. And those flows are going to the
Charles Town plant and will probably do so indefinitely; correct?
A. Yes, unless other alternatives are
sought and approved.
Q. And we may find ourselves in the
position where we need to do that; is that fair to say?
A. That's true.
Q. And with respect to the current
situation in Huntfield, it's my understanding Charles Town has about 27 taps
left to give Huntfield, do you know if that sounds right or not, and then
you're at your limit?
A. I think your ball park is correct.
Q. And that's until a phase-one upgrade
is complete and there's additional capacity available then?
A. Yes.
Q. Now, the phase-one upgrade, the
upgrade that's going to be completed in January, that does not bring the
Charles Town plant into compliance with the Chesapeake Bay standards; does it?
A. No.
Q. And the current plant does not comply
with Chesapeake Bay; does it?
A. No.
Q. Has the Charles Town Sanitary Board
agreed to a plan to bring its plant into compliance with Chesapeake Bay
standards?
A. We are reviewing that and have
retained an engineer who's produced initial cost estimates on compliance with
Chesapeake Bay that are being analyzed now.
Q. But the sanitary board has not ---
the utility board has not agreed to a plan to bring it into compliance?
A. I wouldn't say that the utility board
has not agreed to a plan. I would say
that we we've been provided by the DEP, Division of Environmental Protection,
is that we must come into compliance in the year 2010. So we, on the horizon of the year 2010, look
to addressing compliance at that point.
Q. There's been discussions about a
phase-two upgrade to Charles Town to add further volume capacity at the plant
beyond the 500,000 gallons that's going to be added this January. Has the timeframe of that been established
by the utility board, meaning with that upgrade does the utility board obligate
itself to also bring the plant into compliance with Chesapeake Bay standards?
A. Not as we understand our initial
discussions with the Division of Environmental Protection.
Q. So the phase-two upgrade, that may
not bring your plant into compliance with the Chesapeake Bay standards?
A. If that is the --- we will comply
with the permit requirements at the time that we file for a permit for any
future expansions. If, at the time, the
permit requires Chesapeake Bay compliance, we will invoke that in the action
taken by the utility board to comply with its permit issuance. Whether that's the 2007, 2009, 2011, we
fully intend to comply once those are imposed by NPDES permit.
Q. Okay. You'll comply with the law, whatever it is, when the time comes
---
A. Correct.
Q. --- to expand? But there's a possibility, is there not,
that you might be able to do the phase-two expansion without bringing your
plant into compliance with the Chesapeake Bay standards?
A. That's a possibility, yes.
Q. Your phase-one project was financed
through a rather complex mechanism. Can
you explain that mechanism?
A. The elements that make up the project
financing include the capital improvement fee of $1,127 per connection per
equivalent dwelling unit. There's also
a provision that any new customer that comes on, a portion of their bill, in the
amount of $6.10, will be sent, if you will, to pay the bond issue debt
service. A third element was a letter
of credit that was required to be in place for $700,000 to ensure the payment
of this debt. And I'm sure there's one
other one, but I can't remember what it is.
Q. I think if all else fails, the
utilities will be on the hook.
A. If all else fails, we increase
rates. And let's hope that doesn't
happen.
Q. And your last comment brings me to
the point I was hoping to make. This
mechanism was established to insulate existing ratepayers from the cost of this
expansion; correct?
A. That's correct.
Q. With the idea that this expansion was
caused by new customers, new growth, and they should pay for it; is that fair
to say?
A. Fair to say.
Q. Looking at the phase two upgrades, do
you expect that Charles Town will look for a similar mechanism to pay for that
cost?
A. Yes.
Q. Okay. And then bringing that into Chesapeake Bay compliance, again,
you're going to look for a similar mechanism that will insulate existing
ratepayers?
A. We are not sure, at this time,
whether we can insulate existing ratepayers 100 percent, but to the best of our
ability, we want or would like to be able to work cooperatively with the new
growth to at least share in a large portion of that compliance.
Q. Okay. You've started plans for this phase two expansion, or you're
starting to look at phase two expansion to add more volumetric capacity;
correct?
A. Correct. Well, we're approving the first engineering studies to --- it is as
Staff --- PSC Staff referred to as the fourth basin. So phase two and the fourth basin are sort of the same
project. And we hope to get moving on
that shortly.
Q. Your engineering firm is preparing
what's called a preliminary engineering report or facility plan?
A. Correct.
Q. Okay. And you have this Huntfield --- large Huntfield development and
you have other large developments in the vicinity; correct?
A. Correct.
Q. You don’t see any difficulty in
selling wastewater services in Jefferson County; do you?
A. No, it's just how to pay for them and
get them approved.Q. Okay. If the District is able to obtain this Old
Standard Wastewater Treatment Plant, is the phase two upgrade going to be
reduced by 50,000 gallons?
A. No.
Q. Okay. Charles Town treats wastewater from the District's collection
system. And the District has these
lines that are a fair distance from the plant; isn't that fair to say?
A. Yes.
Q. Does Charles Town encounter any
problems in treating this wastewater that's had to go through numerous pump
stations and the like?
A. Yes.
Q. What's the problem you encounter?
A. From a non-engineering perspective
and a non-operations perspective, the bottom line is we treat high BOD because
of the length of the line and the time that it is in the line.
Q. Okay. Is it fair to say it's not good for wastewater to spend a whole
lot of time in pump stations and transmission lines?
A. Yes.
Q. And that causes it --- harder to
treat when it gets to the plant?
A. Correct.
Q. In response to the Staff Attorney's
question, you said that once the phase one upgrades are complete, that you
would have the capacity to serve the Sheridan development. Do you recall that testimony?
A. Yes.
Q. How much capacity is the phase one
upgrade going to add?A. Approximately
550,000 gallons.
Q. And how is that going to be split
among the three utilities that send flows into that plant?
A. One-third, one-third, one-third.
Q. Okay. And so the District has approximately 180,000 gallons to work
with?
A. Correct.
Q. Do you know if the District has a
waiting list or not?
A. Yes.
Q. It has a waiting list?
A. Yes.
Q. Do you know if Sheridan is on that
waiting list or not?
A. I don't know.
Q. Is it possible that Sheridan may be
too far down the waiting list so that it doesn't qualify to get in the Charles
Town Wastewater Treatment Plant gate?
A. That may be possible.
ATTORNEY KELSH:
Thank you. That's all I have.
CROSS
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. Good afternoon, Ms. Arnett.
A. Good afternoon.
Q. Charles Town is not a party to this
case; is it?
A. No.Q. And
you're here --- how is it that you're here?
A. By subpoena from the Public Service
Commission Staff.
Q. Staff subpoenaed you to come here?
A. Yes.
Q. Did they tell you what they wanted
you to testify to when you were here?
A. We have had discussions about whether
Charles Town could provide service to Sheridan and whether there would be an
objection to initially taking the flows from Sheridan until such time, as I've
said before, there is a sufficient customer base to cover the debt
service. I'm sorry. To cover the operations of the Old Standard
facility.
Q. I don't understand that last
part. What do you mean? What do you mean take the flows from
Sheridan? Say that a different way,
would you?
A. I'll say it a different way by the
exhibit that's been introduced. Charles
Town would not object to future flows from the Breckenridge Pump Station or the
Flowing Springs area being diverted to a new facility.
Q. Did they ask you to say that?
A. We had a discussion about Charles
Town agreeing to that. They didn't ask
me to say that it was --- that we agreed that was possible.
Q. Does that statement assume that
Charles Town owns the flow and can either object or not object?
A. No.
Q. Do you think you own the flow from
JCPSD?A. No.
Q. So whether you object or not is of
little moment; would you agree with me?
A. As it pertains to the City of Charles
Town Wastewater Treatment Plant and its ability to operate as an efficient
utility, I am here on their behalf, on Charles Town's behalf.
Q. And you're treating the 1,200,000
gallons a day now?
A. Just under.
Q. Is there any agreement between
Charles Town and the District that the District has to send all of its flow to
Charles Town?
A. There are financial agreements that
have been approved by the Commission that, as again, I've testified, would need
to be reviewed as it pertains to this case.
Q. What kind of agreements are those?
A. Those that relate to the financing of
the expansion, this current expansion of the plant, those that relate to the
Public Service District's case with regard to the setting of the $1,127
capacity improvement fee.
Q. Well, let me understand. Do you believe the District's under an
obligation to continue to send all of its flow to Charles Town?
A. No.
My testimony with regard to this issue deals with the Charles Town
Wastewater Treatment Plant and agreements that the three utilities have in
existence today.
Q. Subject to compliance with existing
agreements, the JCPSD can send its flow wherever it decides to send it; can it
not?A. Yes.
Q. I'm going to hand you a document and
ask you to study it for a moment. Then
I want to ask you some questions about that.
A. Okay.
Q. Do you recognize that document?
A. Yes.
Q. That is a response of the City of
Charles Town to a Final Staff Recommendation in Charles Town, Case Number
04-0095; correct?
A. Correct.
Q. Have you seen that document before
today?
A. Yes.
Q. Among other things, that document
discusses Charles Town's future construction plans; does it not?
A. Yes.
Q. I ask you to read into the record a
paragraph number four.
A. In the issues set forth in paragraph
2(b) above, Charles Town knows that it needs to file an Application for a Certificate
of Convenience for a further expansion of the wastewater plant. Charles Town is in the process of acquiring
real estate adjacent to the existing plant, upon which the expansion will be
constructed. However, several events
have recently occurred, which have caused Charles Town to temporarily pause in
proceeding with the design of the next expansion.
Q. This document was written about 90
days ago; correct? May 2nd?
A. Uh-huh (yes).Q. All right.
And then following that, the writer goes on, your attorney, goes on to
explain what some of those factors are that have caused you to pause in
planning; correct?
A. Correct.
Q. Turn the page, if you would. And read the sentences that I have
highlighted in yellow.
A. Charles Town believes that it is in
the best interests of all parties to be affected by the Chesapeake Bay
Initiative to wait until the Maryland Discharge Limitations are issued so that
those standards can be incorporated into any further expansion of the treatment
plant. Charles Town believes that it,
Ranson, and the JCPSD need some additional time to assess the impact of Senate
Bill 700 upon the rate of growth of future flows to the Charles Town Plant.
Q. Thank you. So 90 days ago, Charles Town, your town, wrote the PSC and said,
we're going to pause in our planning for the fourth basin upgrade;
correct? For two reasons; correct?
A. Correct.
Q. And one of those is that, at least
according to this document, that Charles Town believes it's in the best
interests of everybody to wait until the Chesapeake Bay initiative limitations
are issued, so that those standards can be incorporated into the new plan, and
secondly, you said Charles Town believes that it needs to study the impact of
Senate Bill 700 on future flows into the Wastewater Treatment Plant of Charles
Town?
A. Yes.Q. Correct?
A. Correct.
Q. Has anything changed in the last 90
days to cause these statements to the Commission to no longer be accurate or
complete?
A. I believe they were accurate at the
time. We have had, since May, discussions
with the DEP, specifically with regard to how we are going to address
Chesapeake Bay. There have been
Chesapeake Bay strategy meetings that I've not attended, but the superintendent
of the Wastewater Treatment Plant has intended on going.
That
has led us to be able today to say that we need to be seeking wasteload
allocations and permitting throughout this process of learning what the
Chesapeake Bay criteria will be for the State of West Virginia. So lots has changed --- a lot has changed in
90 days, I would say, from those statements.
Q. Well, I didn't understand what you
just said to amount to a lot has changed.
In other words, you're still studying the Chesapeake Bay issue. Is that --- did you say more than that?
A. What at the time, in May, we were
under the impression we'd be --- the criteria that would be issued upon the
next NPDES permit for the Charles Town Wastewater Treatment plant is not so
today. That we have an understanding
that could change today in the testimony.
It really depends. I think the
Chesapeake Bay strategy is evolving. We
are today understanding from the DEP that we can file for the next wasteload
allocation and apply for the next NPDES permit under standards that are less
restrictive than will be in the future.
Now, again, that's as of this moment.
It could change. But that's how
we're proceeding today.
Q. And West Virginia really doesn't have
a set of discharge limitations designed to comply with the phosphorus and
nitrogen removal pieces of the Chesapeake Bay Initiative, we don't have that in
place; is that correct?
A. Right.
ATTORNEY MCDONALD:
Thank you. No further questions.
ATTORNEY
ROBERTSON:
Yes, I have a few
questions on Redirect.
REDIRECT
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Ms. Arnett, looking at the three
utilities with the sewer upgrade, current sewer upgrade at Charles Town, there
was here talk, you informed the District's Counsel that there was a one-third
provision, like one-third, one-third, one-third. And that was for each of the sewer utilities?
A. Yes.
Q. And then from there, with like
Charles Town's allocation, from there, what is then the principle that Charles
Town uses to hook up for sewer service?
A. First come, first serve.
Q. Okay. And so it is somewhat of an allocation first, but then you will
have a first come, first serve basis?A. Yes.
Q. With the first basin project, looking
at Mr. McDonald's questions, looking at the fourth basin project, is it --- is the
City's sewer department, the utility board, could look at that and become
Chesapeake Bay compliant? I'm looking
at that looking from the engineer's perspective.
A. We have obtained an engineering
analysis on three alternative methods for treating the entire Charles Town
wastewater treatment plant to meet the Chesapeake Bay standards. And that analysis has been completed and
rough estimates today are that the lowest cost to meet those criteria for the
entire plant, it cannot be looked at as one project meeting it and
three-fourths of the plant not, or 60 percent meeting and 40 percent not. We have done the analysis for the overall
plant to bring it into compliance at such time as those criteria are set and
placed in an NPDES permit that the City of Charles Town would obtain.
Q. All right. So in order to --- for the Charles Town Sewer Treatment Plant to
become totally Chesapeake Bay Compliant, that's going to affect both the
current customers of the City of Charles Town; correct?
A. Correct.
Q. Then also with the developers, it
would affect the future customers that would be connecting with all of these
developments that put houses on to tie in to the sewage to come to Charles Town
for treatment?
A. Correct.
Q. Then by the City of Charles Town, at
whatever future time, meeting Chesapeake Bay requirement, meeting those
standards, then that will also benefit the City of Ranson, because they send
the sewage from Ranson to the Charles Town Treatment Plant?
A. I'm not sure I understand benefit
Ranson. I think that the goal ---.
Q. What I mean, Ranson's not going to
have any Chesapeake Bay requirements to meet because it sends its sewage to
Charles Town.
A. That's correct.
Q. The same thing currently with the
Jefferson County Public Service District, that they would not have to be
looking at the current situation that sends the sewage to Charles Town, it's
just Charles Town that has to meet Chesapeake Bay requirements because you are
the discharge point?
A. Correct.
ATTORNEY
ROBERTSON:
Thank you, Ms.
Arnett. I have no further questions.
MR. FAULKNER:
No further
questions.
CHAIRMAN MCKINNEY:
Thank you. You may be excused.
A. Thank you.
COMMISSIONER
STAATS:
Mr. Chairman, I'd
like --- if you don't mind?
CHAIRMAN MCKINNEY:
Please.
COMMISSIONER
STAATS:
Ms. Arnett, help
me out here just a little bit.
A. Okay.
COMMISSIONER
STAATS:
Phase one, as I
understand it, will be completed January the 8th of next year.
A. Correct.
COMMISSIONER
STAATS:
Is that correct?
A. Yes.
COMMISSIONER STAATS:
And can then
handle the Sheridan Estate project?
A. Yes.
COMMISSIONER
STAATS:
But you will not
be in compliance with the standards of Chesapeake?
A. Correct, nor are we required to at
the District.
COMMISSIONER
STAATS:
Oh, I know
that. I'm not on your case.
I'm
just trying to make sure I understand.
Okay. Then phase two of your
expansion program, when is the projected date that that will take place?
A. The minimum, or earliest that could
be achieved would be 30 --- I would say 30 months to possibly, depending on
appeals, 48 months.
COMMISSIONER
STAATS:
So three to four
years is what you're saying?
A. Right.
COMMISSIONER
STAATS:
And did I
understand you to say that you all probably will not be in compliance with the
Chesapeake Bay standards until the year 2010?
A. That is my understanding of when our
first MPDS permit would require compliance.
COMMISSIONER
STAATS:
Yes, ma'am. And you don't know when you're going to
implement those standards; correct?
A. No, but certainly the City of Charles
Town Utility Board will be poised and ready to comply at the moment that we
would be mandated to do so.
COMMISSIONER
STAATS:
Now, on Charles
Town, I'm just trying to get this thing in sequence.
A. Thank you.
COMMISSIONER
STAATS:
Okay. Thank you very much.
A. Uh-huh (yes).
ATTORNEY
ROBERTSON:
At this time, too,
Ms. Arnett, there's no other questions from the Commission.
CHAIRMAN MCKINNEY:
I'm sorry. I didn't understand the question and the
answer to the question you just asked. So I'm going to back up. My understanding is you answered the
question that phase one will be in January, and that it could accept the
Sheridan wastewater?
A. Yes.
CHAIRMAN MCKINNEY:
The Sheridan
wastewater, that's only if they're first in line or does that --- or are you
assuming that that's carte blanche, that you were granting that?
A. There will be capacity available at
the Charles Town wastewater treatment plant for any connection at January 6th.
CHAIRMAN MCKINNEY:
Okay. And are there other people needing ---?
A. Many, many, many others. The hesitation is that the City of Charles
Town, although it is treating the wastewater, is not the utility provider for
Sheridan. So it is my hesitation that I
am not the Jefferson County Public Service District, who they would be applying
to for service. Although my statement
is that the wastewater treatment plant with this next expansion would have the
capacity available. It's the --- the
complexity and difficulty here is three utilities tying into one facility.
CHAIRMAN MCKINNEY:
Thank you. Go ahead, Mr. Robertson.
ATTORNEY MCDONALD:
Well, I have a
question or two before Redirect, if Mr. Robertson agrees.
ATTORNEY
ROBERTSON:
Sure. That's not a problem.
RECROSS
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. Jane, how does Charles Town now
currently handle requests for service from --- well, let me back up. Do you maintain that whatever excess
capacity is available at the Charles Town Wastewater Treatment Plant now is, or
at one time, was divided among Charles Town, Ranson and JCPSD?
A. Yes.
Q. And there was testimony earlier that
in March 2004 it was determined that so much excess capacity existed at that
time. What was that number?
A. Mr. Robertson roughly calculated it
as 150,000 gallons, but I think in the settlement of that case, it was defined
more in the range of 108,000 or 109,000 remaining. Gallons, that is.
Q. 180,000 or 190,000 gallons ---
A. 108,000.
Q. --- per day?
A. Yes.
Q. And then he went on to say that that
was divided up among Charles Town PSD and Ranson?
A. Yes.Q. He said 240 or 220. That
doesn't sound right; does it?
A. Oh, that was EDUs.
Q. EDUs?
A. EDUs.
Q. Okay. EDU is an equivalent dwelling unit?
A. Yes.
Q. With respect to Charles Town's
allocation of EDUs, how does it --- how does it allocate those out to people
that come to you for service?
A. Until he settlement of the remaining
108,000 gallons, there really were no customers asking Charles Town Sewer Department
for connection. And that was as a
result of the 1988 Sewer Service Agreement, whereby Charles Town really didn't
have new customers. Those new customers
were directed to the Jefferson County Public Service District, under that
agreement.
Q. But that all changed, didn't it? Because now you run the plant, you have a
wholesale rate, you charge JCPSD, you charge Ranson, and except for this
allocation, you control hookups; right?
A. No.
Q. Where is that wrong?
A. That is wrong in this case that's
referenced for --- I'm sorry. It's the
certificate case for this expansion, phase one expansion, where the Public
Service Commission approved, again, an amendment to the sewer service agreement
that allocated this 500,000 to 550,000 gallons on a one-third, one-third,
one-third basis. So that's this next
expansion. Beyond that ---.
Q. That's the next one?
A. That's this current phase one.
Q. Yes.
Is that case final?
A. Yes.
Q. Okay. One-third, one-third, one-third?
A. Yes.
Q. Phase one?
A. Yes.
Q. So how does Charles Town allocate its
one-third to customers who want sewer service?
A. First come, first serve.
Q. Have you used up all your allocation?
A. Of the settlement agreement, for the
108,000 remaining, 108,000 gallons remaining, yes.
Q. Okay. So as far as Charles Town's concerned, it has no more capacity
for its customers, new folks?
A. That's correct. Not until January 8th, 2006.
Q. What happens then?
A. January 8th, 2006, we move into this
newest capacity that is allocated one-third, one-third, one-third.
Q. I see. And you have people waiting in line to get capacity in January of
'06?
A. Yes.Q. And you're going to treat those on a first-come/ first-serve
basis as well?
A. Yes.
Q. And to get in line, to get first come,
what would I have to do if I were an applicant? What would I have to have completed to stand at your door and
say, I'm ready to make my application?
A. A building permit.
Q. Okay. But which comes first?
The building permit or the sewer availability letter?
A. Well, are you talking about the City
of Charles Town's one third only?
Q. Well, let's talk about it. I don't know what I'm talking about. Let's talk about Charles Town. Let's talk about Charles Town's one third,
January 6th, 2006. You've got some
additional capacity and you've got a lot of people waiting in line.
A. Building permit.
Q. They've got a building permit?
A. Yes.
Q. So that they get a building permit
without a sewer availability letter, then?
A. Those customers are within the purview
of the City of Charles Town's operations, its planning and zoning
department. We're knowledgeable about
what capacity exists, what's been approved.
And unlike the County, where there are various agencies that are issuing
a sewer availability letter or issuing a final plat approval or --- it's a
little consolidated.
Q. Oh, you have your own building permit
department?
A. Yes.
Q. You don't use the county's?
A. Correct.
Q. Ah.
Well, can you tell us today how long you anticipate it will be after
January 6th, 2006 before Charles Town's available allocation of the phase one
upgrade is exhausted?
A. No, I can't tell you that today.
Q. Okay.
A. Quickly.
Q. But you have a way?
A. Yes.
I would say.
ATTORNEY MCDONALD:
Thank you, Ms.
Arnett.
ATTORNEY ROBERTSON:
Thank you. Your Honor, if Ms. Arnett can stay, I have a
couple of Redirect questions, if that's okay.
REDIRECT
EXAMINATION
BY
ATTORNEY ROBERTSON:
Q. Ms. Arnett, I'm looking at, first of
all, the certificate upgrade was in 04-0095-S-CN; is that correct?
A. Yes.
Q. And that is --- and that has been a
final, approved Commission order; correct?
A. Correct.
Q. And this is where we get into that
one-third, one-third, one-third of the allocation of capacity either of the 500,000
gallons or the 550,000 gallons of capacity for this upgrade; is that correct?
A. Yes.
Q. Then, looking at that, talking about
your first come --- first come, first serve basis, people that are on the
waiting list, the first person on that waiting list, if they don't have a
building permit and are able to take service --- to take sewer service, do they
move down because they're not ready to take sewer service?
A. That issue hasn't come up within the
City of Charles Town's allocation. The
developers within the city limits that are City of Charles Town customers are
poised and ready to have their building permits issued upon receipt of this
capacity.
Q. Right. So even if a developer has 35 lots and he is going to build two
houses, will the City only issue out two sewer taps or will it send out 35
sewer taps?
A. Two.
Q. Two.
So that is more in relation to a first come, first serve basis, based
upon the need to have sewer somewhat more in an immediate fashion?
A. Yes.
Q. Looking at the agreement that was
filed in the certificate case, is it your understanding that with the
allocation amongst the utilities that the City of Ranson and also the District
is also applying this on a first come, first serve basis after that allocation?
A. I don't recall specifically, but I
would say yes.
Q. Well, I will ask them directly.
A. Okay.
ATTORNEY
ROBERTSON:
Thank you, Ms.
Arnett. I have no further questions.
CHAIRMAN MCKINNEY:
Did you want to
ask this witness to be excused?
ATTORNEY
ROBERTSON:
At this time, if
there are no other questions from the other Counsels or the Intervenor party,
yes, we'd like to ask Jane Arnett also to be excused.
A. Thank you.
CHAIRMAN MCKINNEY:
Thank you. Now, it's back to you.
ATTORNEY MCDONALD:
Thank you, Your
Honor. I'll call Vince Ammirato.
--------------------------------------------------------
VINCE
AMMIRATO, HAVING FIRST BEEN DULY SWORN, TESTIFIED AS FOLLOWS:
--------------------------------------------------------
DIRECT
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. Would you state your name and
business address?
A. My name is Vince Ammirato. Business address is 7012 MacCorkle Avenue,
Charleston, West Virginia.Q. By
whom are you employed?
A. Testing Associates.
Q. What is your capacity?
A. Senior engineer.
Q. Briefly state your qualifications.
A. I have a degree in civil engineering
and 31 years of experience in engineering.
Q. Do you have responsibility with
respect to the Old Standard Wastewater Treatment Plant?
A. Well, with the facility, our scope of
work was for the transmission line from the Sheridan development to the
wastewater treatment, the pretreatment facilities in front of the wastewater
treatment plant and the design of the effluent line from the wastewater
treatment plant to the receiving stream of the Potomac River as well as some
permitting issues, the NPDES permit, the Health Department permit, other
permits such as crossing the railroad and highway.
Q. Now, just very briefly, without ---
trying not to repeat testimony that you've already heard today, describe the
wastewater treatment project, that is to say from the proposed Sheridan
Subdivision to the river.
A. Well, the sewage is already being
collected. That design was done for the
collection of the sewage within the Sheridan development. Our scope of work begins at the first pump
station outside the Sheridan development.
There's approximately 7,000 feet of forced main. It's a six-inch. You kind of go upgrade and then it goes to approximately 4,000
feet of 12-inch gravity. It goes up Route 340, crosses 340 and goes down County
Road 27, where the gravity line enters the property of the Old Standard quarry
site. The gravity main crosses
there. And where we have the wastewater
treatment plant, which we discussed already, constructed there.
Our scope of work was the
pretreatment. That's the lift station,
the screening, an EQ basin and we lifted ---.
Q. The what basin?
A. The equalization basin as to the
flow. You know, the flow is not steady
throughout the day. We have to --- you
can essentially store so much liquid during the day so we can maintain a
constant flow to the wastewater treatment plant.
Q. I see. Your firm participated in the design of these equalization ---?
A. It's essentially a surge tank to
handle the --- because, you know, you'll get big flows in the morning when
everybody gets up, and you have another little peak later in the day, around
dinnertime. And these EQ basins sort of
dampen that flow out.
Q. I see. And your firm also designed the effluent line from the plant or
---?
A. The effluent line takes the discharge
from the wastewater treatment plant across the Old Standard quarry site, under
the CSX railroad and discharges it into the Potomac River.
Q. And has your firm obtained Health
Department and DEP permits for this project?A. Yes. We submitted them and they've been approved,
both through the Health Department and the DEP NPDES permit.
Q. And you understand the DEP --- the
NPDES permit is on appeal to the West Virginia EQB, Environmental Quality
Board, do you not?
A. That's my understanding.
Q. That hearing is next month. What's the size of the wastewater treatment
plant and its expandability?
A. The plant is essentially designed for
125,000 gallons per day. But the
initial startup of the plant will only have enough of these MBR --- these
membrane basins to handle 50,000 gallons a day. The basins we constructed to be empty, initially. And as the plant --- as the wasteload picks
up, they will install additional, essentially cassettes of these membrane
units. So right now there's like two
basins and each basin will have two of these cassettes in it, and that will
give you 50,000, and then the rest will be filled up will give you ten and that
will get you up to the 125,000.
So the initial plant will be
designed for 125,000, all the pumps, the piping, the blowers, the controls will
be sized for that. They just won't have --- the thing they won't have is all of
the membrane basins. But they will just be plugged in as the need is developed.
Q. I see. Is it fair to say that the planning of the sizing of the plant
was to accommodate the Sheridan Subdivision and some additional growth?
A. Yes.Q. Okay. Does the facility
have a wasteload allocation? And
explain what that is and what its amount is.
A. The wasteload allocation is an
allocation that the West Virginia PE grants that indicates how much the
receiving stream can assimilate the load from the wastewater treatment
plant. It's the capability of the
stream to accept this wasteload and not have significant deterioration of the
receiving stream. Right now, the Old
Standard plant has a wasteload allocation for up to 250,000 gallons a day.
Q. But no expansion of the present plant
would be that big. It'd have to ---
what would you have to do to have a 250,000 gallon a day plant here?
A. You'd essentially have to build an
identical plant next to it. Because,
you know, the plant is --- has an designed capacity of --- has a potential
designed capacity of 125,000. If you
need 250,000, you need another --- essentially another identical plant or
another train to it to do that 250,000.
Q. Would you have to get another NPDES
permit
for
---?
A. We'd have to reapply for a
modification.
Q. Okay. And have you --- is it your understanding the plant is designed to
be in compliance with all existing discharge limitations?
A. Yes.
Q. Do you want to say anything about the
effluent water quality?
A. Well, the effluent quality is, again,
we work with the --- before we had testified about with Enviroquip. We work with them to be sure that that plant
is capable of meeting those limits that are established in the NPDES permit.
Q. Okay. You're confident that the plant and the entire system is designed
to meet all existing regulatory requirements?
A. Yeah, because we're not the designer
of the plant, but you know, we have done essentially a review of it and feel
confident that it has that potential to meet it, yes.
ATTORNEY MCDONALD:
All right. Thank you.
No further Direct questions.
ATTORNEY
ROBERTSON:
I'm just going to
ask one housekeeping matter, if that's okay.
CHAIRMAN MCKINNEY:
Sure.
ATTORNEY
ROBERTSON:
I do not remember
this witness being sworn in. Can we
check if he was has sworn for testimony?
CHAIRMAN MCKINNEY:
He was sworn in.
ATTORNEY MCDONALD:
He was sworn in.
ATTORNEY
ROBERTSON:
Okay. Thank you.
CROSS
EXAMINATION
BY
ATTORNEY KELSH:
Q. Mr. Ammirato, I'm Jim Kelsh
representing the Jefferson County Public Service District. The transmission system which you have
designed is designed to serve the Sheridan Subdivision, which initially had
zero homes and is expected to add about 60 homes every year for a three-year
period. Did you see any uncommon or
particularly difficult problems resolved during the first months or years of
operation, when there's low flow going through this transmission system?
A. I wouldn't say they're uncommon. I'd say they're fairly common problems as a
new development. As I stated before,
the beginning of a transmission line is a forced main. And the second part of it is a gravity
main. So as far as the transmission
line, there could be --- there's a concern that there's so few houses coming
on, it's a forced main, that pump is not going to be --- the lift station, the
pump, is going to have a very, very low cycle time. So our concern is that sewage will lay in the forced main section
of the transmission line for an extended period, maybe a period that would be
long enough that you could --- that might have to go septic, at least in the
initial phase of construction, because the cycle time of the pump is so
low. So we are evaluating ways to
increase the dissolved oxygen in that line, either mechanically or
chemically. And we're working with
Enviroquip to be sure that their plant can accept whatever method we use to do
that.
Q. That's a problem that can be solved
without too great a difficulty?
A. Yeah. I don't see which is most efficient or the effective way of doing
it, mechanically or chemically, and be sure we're working with the
manufacturer, that he doesn't have a problem with what we propose. And we had some preliminary discussions with
him on that.
Q. In Mr. Faulkner's opening statement,
he indicated that the transmission system couldn't run properly until there are
about 1,200 customers on this system.
Does that comport with your design of this facility, your understanding
of how this facility would work?
A. I don't understand the basis for his
statement. I mean, it's going to pump sewage.
Q. And you have --- it can run nice on
less than 1,200 customers ---?
A. It can run nice with one
customer. Again, you have to be
concerned, is the --- being this first portion is forced main, that
consideration that we need to consider in the design. Now that we know that the buildup of the plant is there, we need
to incorporate that into the design.
ATTORNEY KELSH:
Thank you. That's all I have.
CROSS
EXAMINATION
BY
MR. FAULKNER:
Q. Mr. Ammirato, let me bring something
up to you. Are you familiar with this document dated February 4th, 2004?
A. Yes.
Q. Were you involved with development of
this document?
A. Partially, yes.
Q. Would you then read two highlighted
areas, one on page 14 and one on page 16, for the record?
CHAIRMAN MCKINNEY:
Now, what document
are you talking about?
MR. FAULKNER:
The document was
an official filing with the West Virginia Bureau of Public Health from Protesta
relating to their pipeline and the construction as part of their application
package.
BY
MR. FAULKNER:
Q. Just if you could read that, please.
A. Section 16, earth work
description. The work to be formed
under this section shall be in accordance with the drawings and as specified
herein, the terms for earth work used in the remainder of this section apply. Unclassified excavation in the native
material, soil, rock, the work under this section shall include but is not
necessarily limited to the following.
Excavation for erosion and sediment control. Excavation for sewer line excavation. Final grading, shaping and contouring any temporary access roads.
Q. And then if you could turn to the
page 16 as marked and read that into the record, please?
A. Okay. Section 16-5, blasting.
The contractor may perform blasting activities as described by this
section. Areas that require excavation,
which cannot be excavated using conventional excavation equipment, contractors
shall comply with all applicable rules and regulations by federal, state and
local jurisdiction when blasting is performed.
The contractor shall notify the owner in writing at least 14 days prior
to the beginning of the excavation operation.
The contractor shall be responsible for all damages caused resulting
from his blasting activity.
Q. Thank you. How deep do you think the excavations will go for the plant
itself? Let's start with that.
A. The plant itself. The wastewater treatment plant?
Q. Yes.
A. Depending on the --- I'm trying to
remember. The basins will probably be,
I think, eight or ten feet.
Q. And then how deep will the pipes be?
A. The sewage line collection lines?
Q. I'm sure they'll be a range, but a
range ---.
A. Yes.
The forced main is like 36 inches and the gravity main, in some places,
again, is a range from three feet to --- I guess from the drawings, it may be
six to eight feet.
Q. I just have a few more
questions. I just need to refer to my
notes. If the plant malfunctions, how
will the operators know?
A. Well, it depends on what
malfunction. I mean, there is a PLC
control.
Q. Well, I mean, if there's a leak from
the plant.
A. There's a PLC control and that would
report if any of the pumps fail or if, you know, a sensor goes out, those will
all be reported. And they can be ---
you know, that can go up to alarm. It
can go back to wherever --- where you want to send it to. It could be to somebody's home, somebody's
office. Those can be all telemetered
back to the location that the operator chooses.
Q. And what about the monitoring of the
pipe itself from the --- from Sheridan to the three --- to the pumping stations
at ---?
A. The pipe is a conventional sewage
line, any sewage line. There's no
special monitoring. It's conventional
sewage line that any sewage line has.
Q. So if a leak occurred, would anyone
know?
A. It would depend on the type of
leak. Yeah, you would see some change
in the plant operation, depending on the type of failure of the pipeline. If it was a break that caused material to
come into the pipe, the plant would pick that up. You would see more sedimentation, you'd see --- you know, there'd
be limits in the plant that would be upset.
Q. And if there was a break in the pipe
where things were seeping out from the pipe?
A. No.
You'd see the plant --- you would not --- you would see your normal
flows would not be occurring. And you
know, you know what your daily flows are and they'd be downhill.
Q. Have you obtained all the appropriate
right-of-ways
for laying the pipe across all of the land involved?
A. Yes.
We've sent to most --- the majority of the pipeline is along the
right-of-way for Route 340 and the County Road 27. And then the rest of the gravity main is along, you know, the Old
Standard quarry. We also have permits
to cross the railroad for the discharge line.Q. So
you're saying that the pipe is --- as is currently planned, is totally within
the highway
rights-of-way?
A. No, except for the one portion that
crosses
the
---.
Q. Okay. But once the --- before it reaches Old Standard, it's all within
the highway right-of-way?
A. Yes.
MR. FAULKNER:
Okay. No further questions.
CROSS
EXAMINATION
BY ATTORNEY
ROBERTSON:
Q. Good afternoon.
A. Good afternoon.
Q. Just a couple of questions. Looking at the wastewater treatment plant
itself, looking at the power costs, were you the engineer, or it possibly was
the Enviroquip engineer that actually provided the number for Staff as a
$40,000 electrical cost?
A. It'd be a combination. Enviroquip provided the electric costs for
their portion of the pumps, the blowers.
I added some smaller amounts for lighting, heating, the pump --- the
lift station. So they probably provided
80 to 90 percent of the costs and I just had some essentially ancillary costs.
Q. So you're in contact with the
engineer, Enviroquip, to eventually come to this $40,000 amount?A. Yes.
CHAIRMAN MCKINNEY:
Is that $40,000 a
year?
A. That I don't recall. I'm sorry.
I didn't bring that with me.
ATTORNEY
ROBERTSON:
Looking at that,
looking at for the treatment costs, at least it's Staff's understanding that
that was at $40,000 a year.
BY
ATTORNEY ROBERTSON:
Q. Now, looking at the particular
collection lines, and I may have misunderstood the --- your information, that
the 125,000-gallon treatment plant, the collection lines, the forced mains were
designed to meet that particular flows?
A. No.
They can flow in excess of 250,000.
Q. Okay. So everything, even though we have the one structure of the
treatment plant that's only rated at 125,000 gallons a day, this was designed,
I know it's expandable up to 250,000, according to the Health Department
permit. So then you designed the collection
lines, the forced mains to handle the maximum --- at least a maximum of 250,000
gallons?
A. Yes, it will handle --- yes.
Q. Then the other thing, if you can
testify to this, then it would have to be required, if you're going from
125,000 to go up to eventually 250,000, it would actually take another physical
structure from Enviroquip, another structure and building to be placed on the
Old Standard property?A. Yes.
Q. All right. With particular --- I guess that Old Standard is using and is
going to be conveying some of the right-of-ways on their property?
A. Yes.
They'd have to provide an easement for the sewer line across their
property, as well as the plant itself.
Q. Right. And with where the collection lines leave from Route 27, going
down to the Old Standard treatment plant, did you have any conversations with
the DEP concerning if there was --- where the transmissions lines may be in a
contaminated area?
A. No.
Q. Do you know if all the transmission
lines or the collection lines on the Old Standard property to the treatment
plant, if that has any contaminations as to where construction would effect?
A. No.
That would have to be --- it would have to be a groundfill site and
would have to be cleared. But I don't
have that information.
Q. Okay. So you do not know that the location of these collection sewer
lines on the Old Standard property, if they're in a contaminated area or not,
you just don't know?
A. That's correct.
CHAIRMAN MCKINNEY:
Any Redirect?
ATTORNEY MCDONALD:
No further questions
from me, Your Honor.
CHAIRMAN MCKINNEY:
Thank you.
ATTORNEY KELSH:
No further
questions.
MR. FAULKNER:
No further
questions.
ATTORNEY
ROBERTSON:
No further
questions.
ATTORNEY MCDONALD:
You may be
excused.
A. Thank you.
CHAIRMAN MCKINNEY:
May this witness
be excused?
ATTORNEY MCDONALD:
Yes.
OFF
RECORD DISCUSSION
ATTORNEY MCDONALD:
Your Honor, I call
Mr. Lee Snyder.
--------------------------------------------------------BERNARD
LEE SNYDER, HAVING FIRST BEEN DULY SWORN, TESTIFIED AS FOLLOWS:
--------------------------------------------------------
DIRECT
EXAMINATION
BY
ATTORNEY MCDONALD:
Q. Would you state your name and
business address, please, sir?
A. My name is Bernard Lee Snyder. My business address is 270 Industrial
Boulevard, Kearneysville, West Virginia.
Q. Is that in Jefferson County?
A. Yes.
Q. Where do you live?
A. I live just outside of Charles Town
on Lee Town Road in a development called Lone Oak.
Q. So you live and work in Jefferson
County?
A. Yes.
I've lived there all my life.
Q. What's your primary business?
A. Snyder Environmental Services is the
company that is my primary employer.
And I own that company and we're a utility contracting company. We started out in 1979 in that company
building package wastewater treatment plants, sewer lines, water treatment
facilities and similar jobs and expanded somewhat since then into more grading
work as well. So we do subdivisions and
site improvement jobs and a lot of horizontal boring and jacking and tunneling
underground.
Q. Would you say Snyder Environmental is
one of the larger utility construction companies in the county, if not the
tri-state?
A. Yes.
Clearly, there are about two or three of us doing similar volume work in
that field in the Eastern Panhandle.
Q. Mr. Snyder, do you have experience in
connection with the construction business in estimating the costs of performing
jobs?
A. Oh, yes. We do in the neighborhood of $6 to $7 million worth of work a
year, and I've always been active in pricing that work. And there are basically myself and three
others that work in the company that do the project management and pricing.Q. Do you have any experience in the regulated
utility business?
A. Well, yes. Back in 1997, we started in the utility business by buying Walnut
Grove Utilities and certificated that.
Or not certificated, but gained the Commission's approval to purchase it
and operate it and a number of other water systems in Jefferson County as Jefferson
Utilities. And we have approximately
1,900 water customers in Jefferson County.
Q. And generally, explain to the
Commission the areas of Jefferson County where Jefferson Utilities provides
water service.
A. Well, when we purchased Walnut Grove,
it was in rather dire straits. But we
had --- it was put into receivership by a Commission Order in 1993. Snyder Environmental went to work for the
Homeowner's Association, which would have been named the receiver. And we were a partner and worked well with
them. We found it to be a rewarding
experience. They were very dedicated
people trying to improve their community they lived in. So we've --- from that Association, they
supported our purchase of the system.
We sought to improve that
system. And we saw the way out of its
dire straights was to expand it, because it had adequate water capacity and it
had reasonable sized mains, but it didn't have a storage tank. It didn't have dependability. It had a myriad of problems with leaks. So we began to improve those problems one at
a time. We were lucky enough to gain
financing, which had a very advantageous arrangement with the West Virginia
Housing Development Fund. We built the
half-million gallon water storage tank, made numerous improvements and got the
lost water under control.
When we started, we were pumping
--- the first month was five million gallons for 160 customers. We've gotten that down to now where we pump
less than that for 800 customers. So
we've done a lot over the years. And
it's been rewarding but yet also very challenging, because it's not been
financially rewarding.
Q. Jefferson Utilities never made money?
A. Not as the whole company, no.
Q. Mr. Snyder, you've hung up on an
easel a map that's titled Jefferson County Zoning Map. It appears to be somewhat the same map that
we marked earlier. But did you obtain
this map? And if so, explain what it
is.
A. Well, it's a map that Dewberry
prepared. It think probably it may have
been an expansion on their original zoning map. And it has some more information on it. It has a location of most of the subdivisions in the county. And I took that map and augmented it by
adding subdivisions that I knew --- or sort of updating it, you might say,
adding subdivisions that were presently proposed that may not have been on that
map so that one could see where those were.
And the large print numbers in the purple, I think it is, are the
subdivisions that I put on a spreadsheet.
Because I did this in conjunction with developing a spreadsheet of sewer
demand so that the Commission could have an idea of what the actual demand for
sewer is in Jefferson County from projects that are real. Some that are under construction, some that
are only in preliminary engineering, somewhere in between.
Q. Now, before we get to that, Mr.
Snyder, I want you to get up and come over here and I want you to show the
Commission where Jefferson Utilities currently provides water service as a
regulated utility.
A. Well, we started out --- this is
Walnut Grove right here. That was the
first system we bought. So we were
fortunate to get that to be expanded to serve in 1997. It was expanded to serve Breckenridge here,
Cambridge and Breckenridge being to the east of it. Cambridge to the south and Briar Run to the west. The tank that we built was located on the
highest elevation in Briar Run. That
system has been expanded now and we started a new system at Meadowbrook, which
is right here. And that system grew. It
supplies Gap View and Sheridan and the Job Corps. We bought three systems --- well, we stayed in a valley
here.
We bought the Shenandoah Junction
System and we --- finally, this Commission approved six years ago our purchase
of the Burr/Bardane Industrial Park Water System. We finally secured approval to do that. Those systems, the Burr/Bardane Park System, which is here, and
the Shenandoah Junction System, here, were connected by a 12-inch main, which
was a project approved by the Commission, undertaken about three years
ago. So those two are connected. That provided fire protection for Jefferson
High School here and the new ninth grade school here.
That system has been extended
down to serve Harvest Hills, the development here. The Burr/Bardane System is proposed to extend to serve Blackford
Village, Tackley Mill, and Jefferson Orchard.
On the mountain, back in the year 2000 ---.
Q. Now, what is the mountain?
A. Well, that may be a rather too common
term to use in West Virginia. But
basically, in Jefferson County, we only have one mountain, and it's the Blue
Ridge. So we call --- references to the
mountain mean the Blue Ridge.
That area has actually been
subdivided quite a lot, as you can see by all these small lines. This area down to the south is generally
Shannondale and a couple surrounding communities, a very large community
started back in the 50s. Has no public
water or sewer. And then three
communities here that we bought water systems in, they were all existing
systems. Keyes Ferry Acres, being one,
another one, Harpers Ferry Campsites, and then the third, Westridge Hills.
Those three systems are, quite
honestly, plagued with a lot of problems.
We continued to try to improve them.
We're still seeking a remedy with the Staff, I might add, to try to get
the moratoriums listed in those areas and improve them. One of our plans would have been if we got
this main coming down that's now at Sheridan to go down by Old Standard and
across the river into this area. That's
a fairly substantial, costly project.
But not too long, actually.
Q. Is it fair to say that you have a
good deal of experience in the contracting business in the county and also in
the public utility business in the county?
A. Yes.
I would say that's fair to say.
And I've been kept abreast of the sewer --- the issues surrounding the
sewer dilemma for a number of reasons.
I have been a developer in respect to Briar Run, when we first did this,
subsequently sold the option to Marcus Enterprises after it was half --- the
project was half completed. And I
participated in a group we call Jefferson County Citizens for Economic
Preservation. It's basically a group of
developers that has sought to hang together against the forces against growth
that are arrayed against us. So for
that reason, and I've worked closely with most of the developers in the county,
so I guess I've come to know more than most people would about the dilemmas
they all face, most of them face.
Q. Now, have you undertaken, recently,
to study and collect your knowledge about proposed developments in and around
Charles Town and Jefferson County?
A. Yes.
Actually, in preparing for this hearing. It, you know, like a lot of things, you'd think this would be
something I might otherwise have done just because of the basic knowledge I
have. But in preparing for this, I
wanted to be able to sit down each of these projects, what their EDUs were,
their demand, where they were, who was serving them, and where they would
likely get service. So I did that and
prepared a spreadsheet of those projects.
Q. I hand you a multi-page document on
legal-sized paper and ask you if this is the spreadsheet that you prepared in
preparation for this hearing?A. Yes,
it is.
ATTORNEY MCDONALD:
Your Honor, may we
have the zoning map marked for identification as Old Standard next number?
(Old Standard
Exhibit Number 22
marked for
identification.)
MR. FAULKNER:
Mr. Chairman, we
would like to have extra copies of that map made available to the other
parties.
OFF
RECORD DISCUSSION
ATTORNEY MCDONALD:
Could we have the
spreadsheet marked as Old Standard Exhibit Number 23?
(Old Standard
Exhibit 23 marked for
identification.)
OFF
RECORD DISCUSSION
BY
ATTORNEY MCDONALD:
Q. Okay. Mr. Snyder, why don't you start at the top of this exhibit and
tell us what you've done and tell us what it says?
A. I could point to each of these on the
map, but I don't know --- I'll be glad to do that if it's helpful. But basically, the name of the developments
in the left column, starting with Aspen Green, that's a 200-acre development on
the Roderick farm on Flowing Springs Road, proposed by Morris Gladhill. Bellair is a development that was approved
by the Planning Commission and is presently under construction. It's 304 units.
Bon Air --- and these are
alphabetized in order --- Alex Rommy's (phonetic) development on Route 340,
it's being engineered and it was actually engineered for a Lowe's store that
did not happen as his first anchor project.
Breckenridge East is BC Partners.
That was directly across the road from Breckenridge on my map
there. Breckenridge was one of the
first projects that we were able to partner with as Jefferson Utilities to get
that housing development fund project underway, which paid for the tank. The first part of Breckenridge was 282 lots.
Breckenridge North, which we served
with water, was a 30-couple lot project.
But the middle project, Breckenridge East, is 697 lots, is fully
engineered, was turned down by the Planning Commission last year. One of the specified reasons being lack of
sewer capacity.
Bridgefort Business Park is a
partially-built park already in the City of Ranson. Butler Farm is a farm owned by a friend of mine, Bob Butler,
which is sandwiched between the Roderick Property and the Breckenridge East
Development. Burr/Bardane Industrial
Park is the industrial park in the middle of the county where we're purchasing
the water system.
Buglers Rest is Gene Capriotti's
property which adjoins on Standard.
Briar Run is the site of our water tank and the other partnering entity
for the original Flowing Springs project.
Cambridge is the third entity developing with the housing and
development fund project. And I should point out that both Briar Run and
Cambridge are presently being restricted in their rate of growth by limits of
sewer capacity. County Green is a
project of Gene Capriotti and Lou Athey.
It was held up --- has been in legal disputes with sewer capacity over
the last year and a half or so.
Daniels Forest is a fully
engineered, 200 --- or 192 lot subdivision proposed by Ed Smariga. That project is before --- in litigation
before the Supreme Court. Another one
of the facts facing development in Jefferson County is that most all projects
are litigated to some level. And it's
oftentimes to the Supreme Court. Forest
View is the second project on the same property, the original 300-acre tract
Roderick Farm. Harvest Hills, Arcadia Development, that project is under
construction. The second phase of it is
delayed for the lack of sewer. And it
had the misfortune to have to go to the Supreme Court to get --- to be allowed
to go forward. It's a Duffield ---
served by Shenandoah Junction System, as I pointed out before. Harris Comstock is a small property that's
proposed for affordable housing along Route 9.
Holiday Inn Express is a project
built by a fellow from Virginia, Carl Owens.
He has been held up for the biggest part of a year now for lack of sewer
capacity, even after he poured the floors.
Jefferson Crossing on Flowing Springs Road is under construction. It's an expansion of an existing shopping
center, but does not have adequate sewer capacity for its full
build-out.
Locust Knoll is a project that
actually was started construction. It's
fully engineered. Construction started
last spring, I guess, and then when the owner became aware of this capacity
crisis and did not have capacity, they stopped the project. So it's been lying idle since then.
Old Standard is the property that
you've heard referenced here, where the plant would be located, proposed to be
located. Norborne Glebe is a large
project served by the District, but in the City of Charles Town. It's developed
by a company called Arcadia Development Company, and they presently have
property that can't be built upon because of lack of sewer capacity, even
though the roads are finished.
Sheridan, LLC, of course, is the subject of this hearing and is
painfully being held up for lack of sewer.
Thorn Hill One and Two are both --- Thorn Hill is completely engineered
for phase one and going through the Planning Commission. Phase Two is being engineered. Of course, both need sewer.
American Acreage --- these next
--- those projects were all in the City of Ranson --- or in the Jefferson
County Public Service District. And in
this yellow block, I should say, at the bottom of page two there, I totaled the
number of EDUs that are still needed.
The first total is the total in the projects and the second total is
those that are still on lots to be built upon.
So that's 6,262 lots. And in
those blocks to the right of that, I separated that demand into the watersheds
so that the Commission could see with respect to the main watersheds in
Jefferson County, in the Charles Town/Ranson area, where each of these projects
was located relative to the sheds.
On my page three, I had the
various projects. Weston Group of
Investors --- and these projects are all in the City of Ranson, a property
which has been annexed to Ranson. That
is --- American Heritage is known as the Wysong (phonetic) neighborhood, Wysong
Farm and Stanley Dunn's farm, an assigned farm. And it's presently being engineered and has been in a planning
stage for probably over a year.
Blackford Village is the project across from Bardane Industrial
Park. And its number of EDUs shown there
as the commercial part of it.
Charles Town Racing, an allowance
for 100 EDUs there. Some of this I
developed from also information I got from both the PSD and the City of Ranson,
but I don't think either of them had any allowance showing for this, but
needless to say, the Charles Town Racing is continuing to build and continuing
to demand sewer capacity, even though it doesn't start new rooftops that are
easily counted like a housing development.
Fairfax Crossing South is a
commercial development at 264 EDUs.
Flowing Springs, or Fairfax Crossing Residential is another 500. Flowing Springs neighborhood, again, is
Weston Group of Investors. That's just
to the south of Briar Run. It's planned
for 450 units. Jefferson Orchard
Business Park is planned for 700.
Lakeland Place, that's a development that's virtually complete, with
waterlines, sewerlines, paving, electric, everything, curb and gutter and
pavement. It will have 628 units. There's like 148 there that are virtually
complete.
Potomac Marketplace is a shopping
center along the Charles Town Bypass.
It's a 400,000-square foot shopping center. And the grading for it is just mammoth. And that's all been undertaken
with a discomforting lack of sewer capacity.
And obviously, an expectation that that will be met.
The Shenandoah Springs
Neighborhood is a project on the 94-acre Palmer/Boyd Farm, former Palmer/Boyd
Farm. And it was started last year. A
substantial amount of grading done and utilities installed. And then the project was stopped because of
this lack of sewer capacity. Spring
Hills is a development that was planned many years ago. It was fully engineered, but the developer
is waiting on a resolution of some other issues in that general
neighborhood. It's adjacent to the American
Heritage Neighborhood. Tackley Mill is
the residential part of the Blackford Farm.
And it has 1,410 EDUs.
So from this table, you'll see
that the remaining lots --- demand for lots in Ranson, I put it at 6,723
lots.
Moving on to the City of Charles
Town on page four, I've listed each of the developments there. Craig Hill Estates is a relatively small
development done by Arcadia Development.
It's half built out. Huntfield
with its --- you heard here discussed by Green Vest is a proposed 3,200-lot
build-out, having approximately 3,000 left to be built. Samuel Station is a townhouse project. I put
that at 80 EDUs. I actually learned,
after I did this, that was a mistake.
It's only about 25. However, the
same developer told me he had another 200-unit project which is not on this
list.
Jefferson High School --- South
Jefferson High School, I should say, is the county's second high school. It is
proceeding and is officially under construction. However, it's relying on the Charles Town capacity for its
service as well. Venton Farms is
another project proposed by Green Vest.
And its number of EDUS at 700 makes the Charles Town future demand at
3,882 lots.
The two projects that are served
by other entities --- Skyline Farms is a project by a fellow named Steve
Mitchell. And it's approximately 60
lots and it's served by Willow Springs Public Service Wastewater Treatment
Plant, as is Windmill Crossing. And
that's a misnomer. That should say
Windmill Crossing, LLC, instead of Skyline Farms. My typo. I guess I should
have caught that. And it's
approximately 200 EDUs. It's a
combination of townhouses and commercial along Route 340.
So when you total all these down,
I assess the grand total future sewer capacity needed from developments that we
know about today that are actively proposing development pursuing design and
construction is 17,127 EDUs.
Translating that into required treatment plant capacity at a design on
180 gallons per day, and that's a relatively conservative number, because you
can go all over the place with that number.
The Health Department's number's 280 gallons per household. However, even at the conservative number,
that puts the required capacity of 3,082,000 gallons per day, shortfall as we
are here today. And then you can see
these --- they way I've spread the flows, that the biggest of those flows are
in Abbott's Run and Flowing Springs, at just over a million gallons a day in
Flowing Spring and 1.2 million in Abbott's Run.
The other watershed being Elk
Branch, which is out where Shenandoah Junction is and where Harvest Hills is,
and Cattail Run, which is where a couple of these projects are. And actually, the racetrack actually starts
the headwaters of Cattail Run.
Q. Which of these watersheds is the
Sheridan project in?
A. In Flowing Spring.
Q. Okay. Have you got some visuals you'd like to share with the
Commission?
A. Yes, I took a lot of photos of each
of the --- or not a lot of photos --- one photo, generally, of each of these ---
not all of these developments. But some
of the developments that are being stopped for the need of wastewater
treatment. Because I thought it would
be helpful if the Commission could see what these projects really look like and
that they do --- are real. They're not
just some kind of misrepresentation of the facts.
Q. I'm going to hand you photograph
number one. It says ten Shenandoah
Springs Subdivision. And tell us, did
you take these pictures?
A. Yes, I did take them, actually just
last weekend.
Q. And did you take the pictures that we
went through earlier, of Sheridan and of the Old Standard property and the
wastewater treatment plant site?
A. Yes, I did. I took all of them. There
are 23 in total.Q. Okay. All right.
Tell us about the picture that's just been circulated.
A. Well, Shenandoah Springs is one of
the developments on this list. It's 361
units, if my memory serves me correctly.
This shows it's a 94-acre tract.
This picture covers probably about 40 acres of it, what you can see there. It looks like scattered weeds and rough
dirt, and that's because the construction, at this point, they've come back in
and knocked the weeds down, basically.
But if you see that one
rectangular object in the center of the picture to the left a little bit,
that's a stormwater inlet. So there are
--- there's stormwater pipes laid here.
This community would be served by Jefferson Utilities with water. So we've inspected the waterlines in this
project and there are several thousand feet of waterlines already laid. And similarly, there's several thousand feet
of sewer and storm sewer and even electrical conduit.
So there's a lot of investment
here, although it looks like just a scarred field. But I'm sure the developer's feeling some significant pain for
his investment lying there.
COMMISSIONER SHAW:
Are you saying
that this --- the lack of sewer facilities is the only thing stopping this
development from moving forward?
A. Absolutely. And the developer's name is Fred Spain. It operates as West End Group of Companies. And I'm sure if you were to talk to him, he
would give you a sad tale of his reality he's faced with this, because you
know, I guess it's strange. I feel like
that, as a part of the development community in Jefferson County, I, as well as
a lot of other people were a little bit asleep at the switch. Because what happened, for the areas in this
Flowing Spring area, where all this development is taking place, back in 1997,
when we first did this Flowing Spring project with the Housing Development
Fund, that the Commission approved, there was an assumption, because, in fact,
there were two projects. There was the
water project that I alluded to for Jefferson Utilities.
And
there was the sewer project for the Jefferson County Public Service
District. And what the project did was
replaced almost all of the sewer line in Walnut Grove. And that was a very good thing, because it
had severe infiltration problems. So
that project covered that.
And it also provided an upgrade
to allow for service to be extended to Briar Run, to Cambridge, and to
Breckenridge, and built this Breckenridge Pump Station that you've heard
testified to today. That pump station
then had the capacity to push the flow back to Charles Town. Unfortunately, that project was intended to
be the first phase of a bigger project.
What was intended --- Penntree designed that. They designed large-diameter collector sewer to start at Flowing
Springs Road and flowed down to Breckenridge.
And it's --- oh, I don't know, several thousand feet through that
distance, with the intention being fully to go ahead and extend that project to
a treatment plant in the Millville Area.
Unfortunately, we weren't
watching. And for the next four years,
very little happened. The people that
run the PSD Board now were not on that board.
And unfortunately, one of those members of that Board, I believe his
goal was to assure that nothing happened on his watch. And it didn't. So that brought us to this sad state of affairs. And people invested money with he
expectation of having sewer, and suddenly, it wasn't there. And it's been extremely painful for a lot of
people.
COMMISSIONER
MCKINNEY:
Thank you.
BY
ATTORNEY MCDONALD:
Q. Mr. Snyder, I'm going to hand you a
picture labeled 12, proposed Holiday Inn Express site.
A. This is another one of those projects
I referred to that's on the list. This
is a 146-room proposed motel. The
construction, most of this concrete was poured last summer, last fall. And then in the late fall, they decided to
stop construction because they came to the realization that there wasn't sewer
capacity. And in fact, you may have
heard their name mentioned before in that reference to the PSC moratorium case. They filed exceptions to that case that may
or --- may be before the Commission.
I'm not sure right now. But they
were the party that filed exceptions because they were the party that was ---
sort of drew the straw, if you will, because they were one of the late ones to
come and ask for capacity. So out of
that bundle of capacity that Charles Town had left that was divvied between the
developers that were all clamoring for it, they didn't get any. So they were --- they didn't have
sewer. So they stopped this project in
the state that you see it there in this photo.
COMMISSIONER SHAW:
That's the one Mr.
Kable testified about earlier, that the exceptions were taken eight to nine
months ago?
A. That's right. Mr. Kable, yes.
ATTORNEY MCDONALD:
Your Honor, before
we get too far behind, may we mark the zoning map as Old Standard Exhibit 22 if
we haven't already, the spreadsheet as 23, I believe we've got that. Picture number ten, Shenandoah Springs, as
number 24, picture number 12, the Holiday Inn, as Exhibit Number 25?
(Old Standard
Exhibits 24 and 25 marked
for
identification.)
CHAIRMAN MCKINNEY:
So marked.
BY
ATTORNEY MCDONALD:
Q. I'm going to hand you now, Mr.
Snyder, a picture labeled 13, Lakeland Place and ask you to describe that
picture.
A. This is a picture of the virtually
complete Lakeland Place project of 148 lots, residential lots. You can see, as I said before, just curb and
gutter and all the utilities. And that
little white tank in the background is Jefferson's water tank, in fact. You can see it's been seeded and
mulched. There's a portion to the left
of the photo that's still under construction, but even it has most all the
utilities in place and would --- actually, this developer was going to use a
drip field as an alternate sewer capacity method, even though that you can see,
this is very close to the rest of the development happening in Jefferson
County, it's labeled on this map. But
this property is right across the railroad from Shenandoah Downs, which is the
one of the two racetrack properties.
It's literally across the street from Briar Run and Flowing Springs and
actually, the front of this, which you'll see in another photo is the --- the
front of the Briar Run Property has become the Potomac Marketplace. So these projects are all immediately
adjacent to each other. But because of
the lack of sewer capacity, they went to this rather dire method to use a
re-circulating sand filter and drip field to obtain treatment. And I believe, I've been told by the
developer, that he's now intending to partner with the City in some form to
help support the upgrade of the City's plant in return for capacity for this
development. That's Lakeland Place.
ATTORNEY MCDONALD:
If we haven't
already, may we have that marked as Number 26?
(Old Standard
Exhibit 26 marked for
identification.)
CHAIRMAN MCKINNEY:
Yes.
ATTORNEY MCDONALD:
May we have marked
for identification as Number 27 a photograph labeled 14, Potomac
Marketplace?
(Old Standard
Exhibit 27 marked for
identification.)
BY
ATTORNEY MCDONALD:
Q. Mr. Snyder, explain this exhibit.
A. That's the Potomac Marketplace
project proposed by Carl Freeman and Associates. As I said earlier, it's a 400,000-square foot shopping
center. The big building you see under construction
there, the most of it is the Weis Market.
Down to the left --- or I'm sorry, to the right of the page, there's an
area that's actually bigger than the area you see here. It's a little bit deceiving, optically. But that area down to the right is going to
be the Home Depot store, a very large Home Depot. And there's some more room up on the left, off the sheet here to
the left. And of course, as usual,
there's going to be an array of small stores associated with those anchor
stores. That, again, is Jefferson
Utility's water tank in the background, for reference.
And this project, technically,
without the Charles Town upgrade, there is not sufficient sewer capacity today
for this project. So it takes quite a
leap of faith to build a project in Jefferson County today.
Q. I hand you a photograph labeled 15,
proposed Bellair Subdivision.
A. This is --- the Bellair Subdivision
is just across the Country Club Road from the first phase of Breckenridge,
which I had talked about before. This
developer, Wormald Companies, in Frederick, Maryland, are the developer of
it. It's a 304-lot subdivision, or will
be. The developer in a zest to get the
sewer capacity, actually applied for these permits for these houses. And in accordance with the agreement, to
keep the permits, he actually built these houses as you see them, even though
he doesn't have the roads or the sewer.
You can see the ground humped up in front of these houses is for chuting
for the sewer line.
So this project's underway, but
there's been --- Wormald Companies are a very successful developer in Frederick
Maryland, so I think they certainly have the wherewithal to build this project
quickly. But they, similarly, don't
know which way to go for sewer capacity.
There's
a case, I think, just filed at the Commission here about an MBR plant for this
particular development as well.
ATTORNEY MCDONALD:
Your Honor, may we
have the Bellair photograph marked for identification as Old Standard Exhibit
28?
(Old Standard
Exhibit Number 28
marked for
identification.)
CHAIRMAN MCKINNEY:
So marked.
ATTORNEY MCDONALD:
And may we have
marked for identification as Old Standard Number 29 a photograph labeled number
16, Breckenridge Subdivision?
(Old Standard
Exhibit Number 29
marked for
identification.)
A. I took this photo. This project, as I said, was one of the
early three that partnered with us and the District for the Flowing Springs
project. It was 282 lots. You're seeing the whole north side of it
there along Country Club Road. It's a
fairly attractive subdivision. You can
see the quality of homes there. Those
homes in Jefferson County are basically all going to be over $300,000 now. The side of the road on which I was standing
when I took this photo is Breckenridge East.
So
right where I was standing is the project that was stopped for lack of sewer
capacity.
I might also say about these
projects, another reason that I've become keenly interested is because as
Jefferson Utilities, I can't sell these people water if they don't have sewer.
BY
ATTORNEY MCDONALD:
Q. I hand you a photograph labeled
Number 17, Briar Run Subdivision.
A. Yes.
This is the Briar Run Community.
This is the most recent phase that's under construction there. You can see the roads are graded, sewer and
water in, and the houses being built.
It's not yet --- doesn't have curbs or pavement in. And these houses are being built under the
remaining number of EDUs that were allocated as a part of that settlement of
the case that allocated that 100,000-some gallons that Charles Town had
available last year.
ATTORNEY MCDONALD:
Your Honor, may we
have the number 17 Briar Run photo marked for identification as Old Standard
Exhibit 30?
(Old Standard
Exhibit Number 30
marked for
identification.)
CHAIRMAN MCKINNEY:
So marked.
ATTORNEY MCDONALD:
And may we have
the next one, labeled 18 Jefferson Crossing, marked for identification as 31?
(Old Standard
Exhibit Number 31
marked for
identification.)
CHAIRMAN MCKINNEY:
So marked.
BY
ATTORNEY MCDONALD:
Q. What is Jefferson Crossing, Mr.
Snyder?
A. This is an extension of an existing
shopping center. You can see behind the
construction equipment that beige building is the existing Jefferson
Crossing. This is a pretty substantial
addition to an existing, heavily-used, occupied commercial shopping
center. And it is planned for a number
of things. These first buildings,
obviously, since they got permits, have sewer capacity. But they're without the Charles Town
capacity expansion, it would not be nearly enough capacity to serve the
build-out of this phase two, which is basically the second half of the shopping
center you see in the back. And it's
--- where I was standing, the Charles Town Races is directly to my right, which
you can't see here. And well, that's
the most notable thing.
ATTORNEY MCDONALD:
Your Honor, may we
have marked for identification the photograph that Mr. Jonkers is passing out
now, labeled County Green?
(Old Standard
Exhibit 32 marked for
identification.)
A. This is a picture of one of the
streets where houses are under construction in County Green. County Green is about a 140-lot townhouse
subdivision. It has just about built
out. I believe there's some 40 or so
lots left to be built upon. And that's
tabulated in this spreadsheet as well.
This, the developer of this project is Gene Capriotti and Lou Athey and
they have been involved. And Gene
complains that he spent $100,000 on litigation in order to secure sewer
capacity for this project. And it is
along the Charles Town Bypass.
ATTORNEY MCDONALD:
Your Honor, may we
have marked for identification as Old Standard Exhibit 33 a photograph labeled
20, Norborne Glebe subdivision?
(Old Standard
Exhibit 33 marked for
identification.)
A. Norborne Glebe is one on the list
that I had. These are, again, fairly
upper-end subdivisions, housing in excess of $300,000. You can see this shows an area that is paved
with gutter and --- curb and gutter.
Obviously, with sewer as you can see and with water. And you can see the fire hydrant. But there is not sewer capacity available
for these lots. So the developers told
me directly that they cannot get permits on these lots today. And yet, they've spent the money for all the
infrastructure to otherwise occupy them.
ATTORNEY MCDONALD:
Your Honor, may we
have marked for identification as Old Standard Number 34 a photograph labeled
21, Huntfield Subdivision?
(Old Standard
Exhibit 34 marked for
identification.)
CHAIRMAN MCKINNEY:
So marked.
A. You know, obviously, Huntfield is the
single largest development in Jefferson County. And I thought to try to give the Commission a feel for what
Huntfield was like, I took this picture.
It's not particularly --- it's probably not putting their best foot
forward, because you know, you could look at the entrance, which is more
attractive. But from this angle, I
could get a lot of the houses in it. So
that's why I took it this way. And it
shows the sections that are presently under construction. Some of what's already built is off the
right of the photo. But there are
something --- and Jane Arnett probably knows far more accurate than me, but
there are somewhere in the neighborhood of 200 houses there today.
Actually, I should say Sue Lawton
probably knows that, too, because the District's been their sewer
provider.
ATTORNEY MCDONALD:
Your Honor, may we
have a photograph labeled 22 South Jefferson High School marked for
identification as Old Standard Exhibit 35?
(Old Standard
Exhibit 35 marked for
identification.)
CHAIRMAN MCKINNEY:
So marked.
A. This site is adjacent to
Huntfield. The photograph I took there,
if you were to go off the left of this --- from the left of where I was
standing, you'd face the photo I took there previously. This is, I believe, about a 50-acre site
that you're seeing a
big
--- the majority of. And that land was
donated as a proffer from Huntfield to the Board of Education. It's not totally philanthropic because
there's an impact fee in Jefferson County for education, so the developer gets
a credit against that impact fee, and that impact fee's $7,200 per home today,
for education only.
But this is the site of that
school. It's supposed to be graded by
the developer. And actually, this first
phase of the work was ENS ponds.
Curiously, I might add, that's our --- Snyder Environmental's
construction equipment because we were the contractor for the Board of
Education to do that ENS, you know, bid.
BY
ATTORNEY MCDONALD:
Q. What did you say the impact fee was
on each new house in Jefferson County?
A. $7,200.
Q. Just for education?
A. That's correct. And actually, there's a lot of opinion by
the opponents to growth that that should be much higher.
Q. Is that imposed by the County or the
City of Charles Town or by whom?
A. It was imposed by the Jefferson
County Commission. It is county-wide,
though. It's effective in the
municipalities as well. There is some
debate, though, of how that's going to be collected in the cities. But I think it's fairly well assured that it
will be collected.
ATTORNEY MCDONALD:
Your Honor, may we
have marked for identification as Old Standard Exhibit Number 37 a photograph
labeled ---.
CHAIRMAN MCKINNEY:
Thirty-six (36).
(Old Standard
Exhibit 36 marked for
identification.)
ATTORNEY MCDONALD:
This is 36. Labeled 23, Buglers Rest, Bloomery Road.
CHAIRMAN MCKINNEY:
Thank you. I'm sorry, I didn't keep up with all the
movement back and forth.
ATTORNEY MCDONALD:
The one I've just
handed out is 23, Buglers Rest, and we'd like that marked for identification as
Old Standard 36.
(Old
Standard Exhibit Number 36
marked
for identification.)
CHAIRMAN MCKINNEY:
So marked.
A. This is a photo of the site and the
initial road installed by Gene Capriotti for the subdivision he calls Buglers
Rest. And it's proposed for 150
townhouse units. And it's at the north
end of the Old Standard Quarry property, immediately adjacent to it, contiguous
with it.
MR. FAULKNER:
I'm going to
object to this one, Mr. Chairman, mainly because while the others have gone
through the approval processes of the County and its legitimate argument that
sewer is a debate, this one has not been proposed in any way, shape or manner
to the county government. And
therefore, someone going forward --- putting this into the rest, there could be
some confusion as to which ones of these projects are truly being held up by
sewer, and which of these projects are still nowhere near being even ready to
be submitted into the approval pipeline of the County. I mean, we're starting to back into a
discussion of local zoning issues now, not just utility issues.
ATTORNEY MCDONALD:
Your Honor, I'm
sure that Mr. Snyder can answer whatever questions Mr. Faulkner might have
about the status of any of these projects on Cross Examination. His objection is not a reason not to mark
and admit an exhibit.
CHAIRMAN MCKINNEY:
We'll deny and we
will admit this for whatever weight exists.
ATTORNEY MCDONALD:
Your Honor,
finally, I ask that there be marked for identification a photograph labeled
Number 11, proposed Route 9 upgrade.
BY
ATTORNEY MCDONALD:
Q. Mr. Snyder, explain what that picture
depicts.
A. Well, this depicts the sorry state of
affairs that the road you see is the Charles Town Bypass. Those rebar with the white covers on them
and the I-beams driven in the ground were the start of a bridge in the
interchange. And the fill that you see
pictured in the background behind the road is the highway fill. And this area's been graded. The roadway extends just to the left of the
treeline that you see and goes out for a mile or so toward the river. This work was done by a Department of
Highways contract for the dualization of Route 9. That stage of it to go from the bypass to the top of Blue Ridge Mountain. That project was held up in litigation by
just a couple litigants. And its been
held up for three years. And the
poignancy of this is that in talking with the PSD staff, one of their
suggestions to me was that this --- a Flowing Springs Plant could be built by
the PSD in three years. And I'm sorry
that I --- I think this points out that even after a contract was let on a
state project, it's been stopped for three years by the opponents to growth.
Q. Now, you don't offer this as --- to
demonstrate that a road project has been stopped for lack of sewer service; do
you?
A. No, no. Just to demonstrate that it's much easier to screw things up than
to get them done.
ATTORNEY MCDONALD:
Your Honor, I'm
about to go into a new area and we can launch into that, or as you wish. We're going to talk now a little bit about
cost estimates of this plant and we have some testimony.
COMMISSIONER
STAATS:
I have a quick
question on your Exhibit 23, your spreadsheet.
I just want to make sure I understand what I'm looking at. In the column that totals up the 17,127,
that total represents EDUs for which there has been no work started; is that
correct?
A. No.
It represents total EDUs for which there has been a proposal to develop
property. Now, some of that property
--- 148 of those in Lakeland Place are virtually finished, for example.
COMMISSIONER
STAATS:
Thank you. So it represents a solid demand for sewage
services?
A. Right. Now, it doesn't represent --- I'm sure there are projects out
there in somebody's mind that I don't know about and the utilities don't know
about. And it doesn't count then.
COMMISSIONER
STAATS:
Okay. In the column to the left of that, which you
didn't total up, it comes to about 18,000.
That is in addition to the 17,000, or is it inclusive?
A. It's inclusive.
CHAIRMAN MCKINNEY:
Okay. Thank you very much. I suggest we break for the day. I believe we will start at 9:30 in the
morning.
ATTORNEY MCDONALD:
Very well, Your
Honor.
CHAIRMAN MCKINNEY:
Thank you.
* *
* * * * * *
HEARING
CONTINUED AT 4:47 P.M.