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EDA trying to nail down water issues

POSTED: May 15, 2007 5:02 a.m.

With the desired rezoning in hand for its massive I-16 holdings, the Effingham Economic Development Authority now it’s trying to put the rest of the pieces in place for its deal with DP Partners.

The EDA and the county are in talks about how to deliver water and sewer to the 1,800-acre northern and the 180-acre southern tracts. The EDA hopes to have its agreement with DP Partners — the national development firm that will develop the Meldrim-area property — finalized soon, but DP Partners is anxious to get water service started at the site.

“There are two big issues,” EDA Chief Executive Officer John Henry said. “One of them is timing. They want nine months for water and sewer to the south side.”

That would come after DP Partners performed its due diligence, which could take four months. The other issue is how much DP Partners would pay on its option for the north side if the road improvements required for that side aren’t done in four years.

But the most urgent matter is providing water to the south side, which is scheduled to be developed first. The county and the EDA are talking about putting in a well, and the county is asking the state Environmental Protection Division to increase its withdrawal capacity by 350,000 gallons.

Also in the works is a temporary septic system. Plans for the I-16 tracts include a wastewater treatment plant to be built on the north side.

The county is willing to give the EDA 60,000 gallons of its existing capacity. The well and its pneumatic tanks would be a temporary solution to get the development started.

“It does not abandon surface water being run out to Meldrim,” EDA Vice-Chairman Chap Bennett said.

The extension of surface water lines from the county’s current network to Meldrim, however, is deemed expensive and lengthy to complete.

“That timeline’s not going to meet DP and our pocketbooks,” Bennett said.

The EDA and the county would enter into an intergovernmental agreement for the well and the future water lines, but there are still some issues to be worked out, namely who would pay for construction and who would get the tap fees. Bennett estimated the EDA could get water and sewer, with the well and septic tanks, established in six months.

“We’ve still got an obligation to get water to DP,” he said. “It’s still going to behoove us and the county and everybody else involved to get surface water down there.”

A well is estimated to cost from $425,000 to $800,000.

Henry warned that the EDA and DP Partners need to be able to move soon on its properties. He pointed to Bryan and Liberty counties’ new industrial parks and Liberty’s partnering with IDI, one of DP Partners’ biggest competitors. He also noted Duke’s purchase of Northpoint Realty and AMB’s deal with the Morgan family in Chatham County, close to the EDA’s I-16 tract.

“We’ve got a lot of big players in the area,” he said. “IDI and the others are building in the area. In the last two years, every one of the top 10 (industrial developers) has been here.This is not going to be a fun game in seven years.”

As the port of Savannah grows and as other industries such as Gulfstream continue to boom, Henry told EDA members the I-16 tract is strategically located to take advantage.

“It’s going to come down to who has the most available, most affordable and the closest space to the port,” he said.

“That’s why we’re going to be able to be competitive with Bryan and Liberty.”

Henry also said the port likely will diversify in the next several years, with more of a need for industrial assembly space rather than warehousing.

He said he hopes he can have the final details with DP Partners on their contract worked out in two weeks.

“This thing has been going on for about a year,” Bennett said. “It will be a great day when they sign on the dotted line. There’s been a lot of negotiations just to get to this point.”

If the EDA can’t deliver the required water to the southern tract in DP Partners’ timeline, DP Partners could access escrow funds to build it or take it off the price for their option on the property.

The EDA will look at recovering the cost of the infrastructure it puts in for the site, but how much it will be able to get back remains to be determined.

“We’re not wanting to the enter the water and sewer business and make money out of it,” Henry said.

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