Ascension Parish voters will be asked April 24 to decide whether the way to settle parish government's decades-long struggle to improve sewage treatment is to let someone else handle it.
Through the years, parish leaders have floated various plans to build a regional system financed with government loans and grants or with a private partner. But the cost, a fledging customer base, and the potential necessity for high user fees, new taxes or both have led those ideas to founder time and again.
A new group of parish officials — who fought as councilmen and president-elect in late 2019 to block a proposed sewer partnership with Bernhard Capital Partners Management — have wrangled with the investment group and among themselves for the past 13 months.
They concluded it's better to exit the sewer business and sell off the parish assets. Under the deal voters will consider, Ascension would sell its package plants, force mains, trunk lines, land and other assets to a local sewer company owned by Bernhard Capital Partners for $9.26 million.
The company, National Water Infrastructure, would ink a 20-year, non-exclusive franchise agreement with the parish and pay an annual franchise fee that will escalate as new customers are added but start at $500,000, parish officials said.
In exchange, the company, which is the successor to and partly owned by longtime local sewer provider Ascension Wastewater Treatment, will spend $200 million on a new regional treatment plant. The new plant would consolidate now-scattered neighborhood sewage treatment systems and reroute the treated wastewater to the Mississippi River.
Parish officials said they will save $3 million per year in general tax revenue spent to subsidize the cost of the small, disconnected parish systems.
In pitching other council members to put the plan on the ballot earlier this week, Council Chairwoman Teri Casso recounted the parish's history with sewer negotiations and how they have led to this point.
"The rest of the story begins tonight, and it will make a difference for our children, and for their children and for our businesses. It will make a tremendous difference for our parish government. It will take off our plate a very expensive effort to accomplish what we have not been able to since 1990," the three-term councilwoman from Dutchtown said.
The initial joining of the parish and National Water systems would total 19,000 customers in unincorporated eastern Ascension. The plan doesn't affect Gonzales or Sorrento municipal customers or people with individual, private systems.
The regional system would fulfill a long-sought goal of parish leaders and state environmental regulators by pulling treated sewage effluent out of overburdened local waterways and ditches and sending it to the Mississippi.
Parish officials said they plan in-person open houses and perhaps virtual ones in the coming weeks to explain the deal. Thursday's vote suggests the entire council and Parish President Clint Cointment are behind the deal.
The state Public Service Commission would also have to approve the deal and any potential rate increases.
"It's fair, it's equitable and governed by the Public Service Commission," said Tom Pertuit, CEO of National Water, "who has a history of putting the ratepayer first, and they will be extremely cognizant of all issues related to the ratepayer, I know that."
Pertuit said ratepayers would see "extremely minimal" rate increases for at least the first two years but acknowledged some increases were likely with the significant capital outlay expected.
NWI residential customers currently pay $45 per month; parish customers pay $42.50 per month. Pertuit added that no one with a private, individual treatment system would be required to hook into National Water's network.
The united parish stance is a turnabout. Eight months ago, amid negotiations with Bernhard, Cointment had pitched a plan to have the parish go it alone and leverage Ascension's existing assets into a regional system.
After the vote Thursday, Cointment, who had months ago warmed to a sale, voiced his support for the deal and halting future use of general parish revenues on a sewer system that had already cost $42 million in subsidies over the past 10 years.
Though the parish system may be poised for customer growth —it has accumulated the rights to a swath of new customers recently — Ascension is only projected to have 2,700 by the end of 2021 and faces significant upfront costs to meet environmental requirements.
"My administration fully supports this sale of the parish’s sewer system because along with all of the financial benefits, this is our best chance to improve the environment and remove 3 million gallons of sewer effluent per day from our polluted waterways and ditches," Cointment said in a statement.
In addition to future annual savings, the sale will also allow the parish to redirect $13.5 million now set aside for sewer costs, the Cointment administration says.
NWI also has agreed to pay for $1 million in needed repairs to the parish-run sewage treatment plant at Oak Grove Primary School that serves the school and customers along a parish trunk line under La. 42 in Prairieville.
Councilman Corey Orgeron, who is the utilities chairman but was not part of private negotiations that have dominated the last months of the deal's refinement, was an early proponent of an agreement that would have eventually sold off the parish assets.
That earlier deal was closer to a lease with an option to buy for Bernhard and offered at least a $15 million payment to the parish for its assets — nearly $6 million more than what the parish would now receive.
A subsequent appraisal found the replacement cost of the parish's sewer assets totaled nearly $28 million, but physical depreciation, obsolescence and other hits reduced value by nearly two-thirds. The final price of $9.26 million is an average of two valuation methods, the appraisals say.
Orgeron said this agreement remains the right path for the parish and the public: "This is the best deal we've gotten in decades, and it's the best deal we're going to get anytime in the near future."
Under the agreement, NWI has committed to finish a first regional plant within five years. NWI would build another 4 million gallons in treatment capacity, which also would discharge in the Mississippi, after an additional 15,000 customers are added to its system. The parish government would bear no cost for the plant, though ratepayers would have to finance it.