Draining feeling? Lawsuit challenges dam-pipeline plan

Back in 2010, before changing his position, Charlottesville City Councilor Satyendra Huja predicted that wars would be fought over water, but he may not have realized that the battle would reach his desk. Last Friday, the dredger-turned-dammer and now-Mayor Huja found that he was on the receiving end of a lawsuit slamming his turnabout vote as illegal, wasteful, and "absurd."

The lawsuit filed March 23 in Charlottesville Circuit Court against four local bodies climaxes a multi-year struggle over a controversial plan to centralize local water supply in a massive reservoir to be built atop an existing one in the Ragged Mountain Natural Area. Long before the legal action, the plan came under attack for taking a chain-saw approach to nature by consuming over 150 acres of mature forest and because the enterprise– launched by a government-fed group called the Nature Conservancy– will drive up local water bills while abandoning an existing gravity-fed water pipe in favor of a much-larger pipeline whose tens of millions in construction and ongoing electricity costs aren't included in the current capital planning.

"We feel this dam scam is Exhibit A for the kind of crony capitalism that has been pervading local government actions," said Bob Fenwick at a press conference announcing the suit. An engineer-builder with seven years in the Army Corps of Engineers, Fenwick joined fellow activist Joanna Salidas to announce that they were members of a new group called the the Charlottesville Open Government Alliance, which is raising money to support the lawsuit.

The person filing the suit is Belmont neighborhood resident Stanton Braverman, an immigration lawyer with offices in Washington and Charlottesville. Contacted later Friday, Braverman declined to elaborate on the suit.

"The thing speaks for itself," says Braverman, whose complaint alleges that City Council– in a 3-2 vote in January– unlawfully sold its three reservoirs long owned by the City thus forcing future generations of City residents to beg Albemarle County if they end up needing additional water. Key to the legal argument is whether a sale masquerades as a lease.

A January 10 written opinion by City Attorney Craig Brown dismissed the idea that the City has "sold" any assets and therefore the contentions advanced by Braverman that Council– under provisions of the state constitution and the city charter– must hold a public referendum and/or muster a super-majority of Council to legalize its action.

"I've studied the constitution," says David Repass, a retired college political science professor who watched the press conference. "The three Councilors and the other defendants violated these fundamental laws."

The suit– though also naming Albemarle County and its water utility– is expected to be vigorously defended by the fourth defendant, the Rivanna Water and Sewer Authority whose attorney, Kurt Krueger, bills over $500 an hour and hangs his hat at McGuireWoods, the Richmond-based powerhouse that has served as home to several ex-governors and other top officials. The Hook's legal analyst questions the wisdom of putting an immigration lawyer in charge of a complex issue that might reverberate all the way to the Capitol– if it ever gets that far.

"It's complicated because you have to legally and factually analyze every piece of this puzzle to see what it is," says analyst David Heilberg. "I guess you can litigate that, but a judge might not let 'em."

In recent weeks, the muddy bottom of the existing Ragged Mountain Reservoir has been laid bare as part of a draw-down to prepare the place not for dredging but for building the new reservoir. On Wednesday, March 21, the chief executive of Rivanna, Tom Frederick, told Charlottesville Tomorrow that he'd just inked the first part of a deal to spend $27 million to build the new dam.

A day later– and ironically on "World Water Day" when a local conference highlighted decentralized water solutions– Frederick found himself huddling with the Rivanna board in a multi-hour emergency meeting.

The result of the March 22 closed-door confab was a request for an expedited hearing on Rivanna's effort to borrow $31 million by selling bonds. As Frederick and his board know, lawsuits typically spook the bond market. Judge Cheryl Higgins immediately scheduled a hearing for April 19.

The bonds would produce $25.7 million for the dam, $1.7 million to fund environmental projects to "mitigate" the dam's damage, $2.1 million in reserves, with the remaining $1.5 million covering expenses and the fees for the underwriter.

The underwriter is Davenport & Company, a Richmond-based firm whose advice recently drew a lawsuit alleging that Davenport selfishly prodded Fluvanna County into borrowing that unfairly enriched the firm while costing taxpayers $18 million in unnecessary interest expense. In mid-March, the Fluvanna Supervisors voted their unanimous intention to appeal a month-earlier dismissal of the suit. When that happens, Fluvanna– like Stan Braverman– will face off against McGuireWoods.

One of the undercurrents of the water plan is the potentially corrupting influence of money. With an annual budget over $16 million and a five-year capital-spending plan topping $186 million, Rivanna's ability to channel cash has been causing concern for years.

One of the questionable aspects of the local water plan was Rivanna's decision to let one engineering firm scare the public away from dredging with Panama Canal-sized cost estimates and then step in to design a dam. While that company, Pennsylvania-based Gannett Fleming, eventually got thrown off the job after insisting upon a completely concrete dam, the dismissal didn't happen until the firm had reaped $3.9 million.

A more recent money question was raised by this reporter in a last-summer story uncovering myriad hidden financial connections between the water plan's backers, chief among them the Nature Conservancy. Ostensibly independent, the non-profit Conservancy relies on millions each year in government grants and holds a multi-million-dollar financial partnership with the same government agencies– the Norfolk Office of the Army Corps of Engineers and the Virginia Department of Environmental Quality– that might have derailed its plan for Charlottesville. The Conservancy has also lured image-burnishing corporations into the mix.

Both American Standard, a prominent plumbing fixture company, and Nestlé Waters, the maker of myriad bottled brands, have promised million-dollar donations to the Conservancy's so-called "Freshwater Initiative," whose proposed dam-pipeline for Charlottesville is a centerpiece for a national model.

In an attempt to publicly derail criticism of corporate influence, Mayor Huja recently told citizens that the Conservancy never got the money from Nestlé. However, Nestlé spokesperson Jane Lazgin, tells a reporter that Nestlé followed through on its million-dollar gift.

Huja concedes that he reiterated erroneous information.

"But I don't see anything wrong with donations," says Huja. "It's legal to donate."

As for the lawsuit, it's "an unnecessary delaying tactic," says Huja. "We have had enough debate on the topic, and I understand that people don't agree with this, but we need a water plan for the future, and this is just delaying and costing more."

Attached Documents: 

42 comments

As another posted noted, the scandal surrounding Ric Barrick is only the tip of the iceberg. Follow the money!

Something worth mentioning again as well is that both Huja and Szakos use personal email accounts instead of city provided accounts when conducting much of the official business of the city. The facts of the Barrick case only became public because of the use of records that could actually be searched. No telling what damning information in this case has been hidden away in email accounts that the public wouldn't have the ability to review. I think that practice ought to be illegal (if it isn't already) and the fact that it is allowed speaks volumes about the culture in city hall.

I still wonder if Huja, Brown, and Szakos violated state law when they conspired togther to pass the dam.

Give it up Charlottesville. Your days of control are over and we know how to run a government operation better than you do. Our county is better managed and much more efficient than the city with fewer workers and more productivity. Oh, and our purchasing guys follow the law.

Sit back and enjoy the ride because you'll be better for it. The only thing a lawsuit can do is postpone the inevitable.

Sign the petition to Stop the Illegal Ragged Mountain Dam Plan!
http://signon.org/sign/stop-the-illegal-ragged.fb1?source=s.fb&r_by=2710065

Albemarler--maybe want to revisit your comment in the wake of your corrupt school superintendant(talk about procurement procedures) and the midnight maneuverings by one of your supes directed toward another addled supe.

Not defending the city here--but the county has a ways to go before it could be considered well run.

In my opinion, getting in bed with the Nature Conservancy is always a bad move. This organization has a track record of self dealing. I seem to remember that a former head of this cabal on the national level took advantage of many very questionable real estate deals. I am told that the local office has a reputation for questionable hiring practices, snobbery and an inflated sense of self importance.

I love The Hook, but I can not stomach your legal "expert". I believe that he has never missed a chance to throw dirt on large law firms. His reading of the recent murder trial was way off. The talk on Park Street is not very positive about him as a lawyer. Perhaps he has large law firm envy! He seems to be a legend is his own mind. It has been said of him when he walks into a meeting that the EGO has landed!

It has always seemed silly to me that small cities have duplicative services with surrounding counties. Charlottesville and lots of other small Virginia towns might be well served by merging services with surrounding counties and consider the advantages of scale. While I am not in love with the Albemarle Supes, I think a singular approach to this problem and many others would save time and money. My two cents and my opinions.

BTW, I am not a lawyer and have no skin in the local legal game.

I care about the environment and hope my great grandchildren have water to drink. Clean water is a very serious problem in many places around the world. We are called to leave the world better than we found it. Wake up friends, it's time to think of others, the future and not our typical Charlottesville self absorption!

Mr. Braverman is doing a great service for the poor and middle class of Charlottesville and Albemarle County on whose backs this dam is being built, and who will bear the burden of the cost and loss of assets.

What a legacy for the man who claims to be the architect of the Downtown Mall.

Lawrence Halprin was the architect of the Downtown Mall. All Huja ever did was interfere with and weaken the design. Seems to be his standard MO considering what he did to Norris plan for the water supply.

Anyone else really ticked that the Rivanna Water and Sewer Authority whose attorney, Kurt Krueger, bills over $500 an hour at McGuireWoods? Currently paying them for my water bill, now I am considering digging a well.

I find that a waste of money to hire an attorney from a firm such as that (even fired one from that firm on another matter - their billing isn't just high, their attorneys are substandard and their billing is corrupt.

Fire them all - and move in and put people who have some common sense about all these issues. Oh - that is right they have "terms" and can't be fired? Why not?

This town is too small and the lawyers too cozy to find an impartial judge.

Move this case to Fluvanna and put it before a jury. Same bunch of RSWA/RSWA folks didn't fare too well there last time .

http://www.readthehook.com/69237/jury-verdict-rswas-star-witness-convict...

Three of our five City Councilors have sold out on us and broke the law to do it.

Check out the transcript at this website that says “City Council in action”-

http://www.cvillealliance.com

and by the end you will be very glad we have Dave Norris and Dee Smith on council, and thinking up replacements for the other three.

I would like to hear the story behind Mayor Huja telling citizens that the Nature Conservancy never got a million dollar grant from Nestlé to help plan our water supply and now admitting that they in fact did.

We need leaders who will serve Charlottesville’s residents instead of predatory corporations with lots of money that use money to deceive us into giving them public money for projects designed to make them much more money. Fight corruption at home. We still have a chance to save Ragged Mountain Natural Area, millions of dollars, rights to our water and rule of law in Charlottesville.

city resident, don't confuse the RWSA with a witness in a case, a case which resulted in a $900,000 settlement FOR the RWSA.

Only those that wanted to believe that the RWSA was corrupt believed that that lawsuit was a failure. Don't fool yourself.

deleted

Count me in - I do believe the agenda of the RWSA and the RSWA is corrupt. They have spent years wasting public funds, misleading the public and spinning the data for their own glorification to build a dam at any cost and to destroy Van der Linde Recycling at any cost. We the ratepayers have funded these orgainizations and it must stop.

I would like to see the entire Authority disbanded as the first step, after winning this lawsuit, to regain fiscal and environmental sanity in this community. And the elected officials that have condoned this should be recalled for fiscal irresponsibility.

Mr. Frederick has led us all astray and it's time to wake up and see with your own eyes that the water/waste emperor has no clothes.

Heed the words of Tom Worrell, and donate now to put an end to this insanity in our community .

""We've got to stop living in denial," said former Daily Progress owner Tom Worrell in a rare public appearance. "There's a problem with the planet."

http://www.cvillealliance.com/

Just when you thought RWSA couldn't get more out of touch.
http://cvilletomorrow.typepad.com/charlottesville_tomorrow_/2012/03/chlo...

Frederick keeps hand us little pieces of a huge plan without ever letting us see that something more is already planned and that the total costs are far more than anyone imagines. There is going to have to be a drastic increase in the size of the current treatment plant in the near future too for any of the current work to make sense. No one is giving the public a full accounting of the projected costs so that informed decisions can be made.

At the very least I'm hoping this lawsuit will enlighten the public to what will turn out to be a bridge to nowhere. A dam holding back not a gallon of water. Wait till the water bills go up and people start looking for water that doesn't exist. Where is it? they will say, then they will be told its 9 miles away and another 50million dollars please.

What happens if there's a serious drought while Ragged Mountain Reservoir is drained ?

the wheels have come off the train
for any responsible alternative to the
community water plan.

an open government alliance ; whatever that means
with the sad requisite facebook and website links appears.

its spokesperson is a two time failed city council candidate
who is beginning to resemble a combination of an ambulance
chaser and dudley-do-right.

the lawsuit filed on line is short on substance and long on drama.
perhaps the plaintiff should have researched city and virginia code
more closely.

it is sad to see citizens for sustainable water devolving into this sad sideshow.

You really game me a chuckle rockerford files. How many people have been seen as silly, or made fun of done things like....come up with the theory of relativity and then create the bomb? Lots of people were laughing at Einstein too.

I read the brief, and have a very different take on it. I thought it did an excellent job of bringing together into concise referenced points the problems with a very convoluted agreement written in a way to obsfucate. It also highlights the very real danger of this community being saddled with a degree of debt that can bankrupt it.

I would rather have a duddly do right like Bob Fenwick running around, than an indebted do wrong who manages to get elected due to one/two party rule.

From the Complaint:
THE PROJECT IS ABSURD AND SHOULD NOT GO FORWARD
17. The Project as approved will lead to absurd results for the following reasons.
18. There is no need to increase the supply or reserve of fresh water at this time since there is
no mandate from any competent authority to do so at this time and there is currently enough
water supply capacity to serve the project population in both City and the Urban Service Area for
15 to 20 years .

This same argument can be used to say Dredging is absurd then. Its absurd to plan ahead in Virginia. This whole last paragraph should have been left off and just stayed with the first part.

That's pretty selective Sam considering the length of document.

"19. The City gets no benefit from the Project, and indeed suffers a significant loss of water allocation." It is absurd for the someone to give away have their water, and cut themselves short of their needed water, while assuring the other party gets more than their needed supply, and pay a premium, while getting nothing in return.

We can go on to 20 and the rest if you like, but they are on point, even if some might disagree.

As for 18, it does not say don't plan, it says " at this time". We could do this 10 years from now and we would still have the same results. What's more, with the draining taking place, if we had a drought this summer, we WOULD be in trouble.

What is the point of storing water you may never need at great expense while destroying the resources you have - instead of dredging incrementally to maintain the current supply and then a bit more to add as needed . And for a fraction of the cost.

I guess that makes too much sense.

On Clause 19 then. X is the amount of water in the current dam, all currently owned by the City and none by the County (is my understanding). The City is going to allow the County to come on the land and build a new dam (of which Albemarle pays 80% and the City pays 20%? I think I saw) Then after the dam is built the City only gets allowed only 1/2 of the X (the original amount they owned before the dam was built) and the City has to pay 20% of the dam in addition. One would think the City would get X (the amount they originally started with and 20% of Y (20% of the new water amount created). If all this can be proved to the Judge, I would leave it in.

Correction - county pays 85% of Dam and city 15% but how stupid Is xthis . The city has all the water they would need for 100 years or more just by dredging the reservoirs they already own .
Let the county use the already owned buck creek or buy their own land for a new reservoir or expand beaver creek. Let them use their own resources and not take the City's and then penalize the city to buy back the water they already own . What City official with half a brain would agree to such a deal ?

All city residents should line up behind this suit .

And the dam alone is worse than useless without the 10 mile electricity driven uphil pipeline for which the City agreed to pay 20% of $ 63 M ( very rough lowballed estimate ). .

the spokesperson for this alliance , such as it is
Is on life support with this issue....more like Edmund O'Brian
Desparately trying to find out who poisoned him in the movie D.O.A.

The city and Virginia codes are somewhat more inclusive than the plaintiff
Imagines , and what is " confusing " for one , may not be so for another.

The municipal bond market, and a community , agency or authority issuing
Bonds , how those bonds are issued , insured and paid off , is a bit more
Detailed than plaintiff's concerns.

I am off to Bear Lake in the San Bernadino mountains to do some trout fishing
With my dad Rocky...remember him.? ...he's a great guy.

Remember , leave a message after the beep

Jim Rockford

Sam,

Its evident that you do not really understand the water plan at all, which is exactly the way the RWSA and special interests in favor of this plan wants. It also makes you look very foolish complaining about the attorney's complaint.

Let me make it easy for you.

I own a lake of water that is entirely on my own property. I water my 100 cows from that lake. I also sell water to fill the troughs of my neighbor. He has 100 cows. I know the lake is silting in a little bit, and to plan for the future, I start saving money to clear out the lake, and I let him know that if wants to keep buying water from the lake, he's got to put a little something towards it in what he pays in usage. It will water both herds for the next 10 years with moderate growth. The savings plan is 60% me, 40% him. We both realize our herds are getting bigger, and the dredging plan will give us enough for 300 cows. But he still wants more water and from my lake. So, he says, lets expand the lake. Lets build some pipes to pump the water from the river in case the springs run dry, and also some new pumps right next your lake. To start with, you'll also give me half of the water in the lake. I won't pay you for the grazing land you lose to the water or the land the equipment sits on. I'll borrow money for the new equipment, and you pay 15% of the interest, I'll pay 85%, but I get most of the new water. The money we pooled to save can go towards some of the updates on the equipment we already have. If you need more water than this new allocation, you'll have to pay me a preium and more towards the new equipment.

The problem is, in 10 years, I expect my herd to have 150 cows, but this new allocation leaves me with less grazing, and only enough water for 130 cows, while my neighbor has enough water for 190 cows from my lake, even if he also would have 150. If I want to water my 20 other cows, I have to contribute a large cash lump sum to my neighbor, and more interest raising the costs even more. For water I would have had access in my own lake before the deal?

Why would any rational person with enough of what they need to water their cows for the next 10 years, give up grazing and half their water from their lake for free, pay for new equipment, knowing that they now would NOT have enough, while their neighbor has more than enough?

Why would any rational person contribute to plan supposedly to provide for enough water or the area, that leaves them short of water?

The answer is simple. They wouldn't. Nor should they. Yet for some odd reason, folks like you think that's exactly what the citizens of Charlottesville should do, because you haven't taken the time to really understand the plan. This isn't even really a good deal for the County residents either, because the cost of this plan is massive, and they will be on the hook for it.

Sit down, and read that plan, until you really get it. If you need help, ask someone who can. It took me months and months to figure out what was going on, so don't feel bad if its confusing.

"The municipal bond market, and a community , agency or authority issuing
Bonds , how those bonds are issued , insured and paid off , is a bit more
Detailed than plaintiff's concerns."

The bond market is smart enough to not want to get invovled with somethng that stinks, if they can smell it these days. That's what those in favor of the plan are deeply afraid of.

RWSA lawyers have scheduled a hearing to keep their bonds alive on April 19th at 4pm at Albemarle Circuit Court and they are promising our resources to make it happen.

I see another Harrisburg in the making if the bonding agencies fall for this .

Harrisburg Files for Bankruptcy on Overdue Incinerator Debt

Harrisburg, Pennsylvania, facing a state takeover of its finances, filed for bankruptcy protection after failing to pay the debt on a trash-to-energy incinerator.

http://www.bloomberg.com/news/2011-10-12/pennsylvania-capital-harrisburg...

" RWSA Board of Directors Adopts Bond Resolution; Directs Filing of Bond Validation Proceedings for Expedited Review to Finance New Ragged Mountain Dam "

http://www.rivanna.org/home.htm

Bonding is a big hurdle for RWSA but they should have big help from Nature Conservancy contacts. Goldman Sacks is all over this and has many past presidents serve as presidents of the conservancy which is larger than the National Park Service.

But consider the fees and interest we will be paying. RWSA bonds are NOT aaa rated. Already they are Abb and falling. Will be interesting to see who makes money from this deal on finance and refinance fees, if it in fact even gets bonded.

As HUJA says " water is fundamental"!

Oh I don't know rockford. The ability for someone to take an extremely complicated processes and turn them in clear legal arguments on a pretty straightforward level shows an incredibly high level of insight, education, and intelligence. What makes you think people like Richard Lloyd don't understand the bond process either?

Hoodwinking a few council members who happen to not understand it like Szakos is not hoodwinking the entire population. That's exactly why both the State of Virginia and the City Charter require a much higher level of civic agreement to get something like this passed.

Smart individuals smell the stink and know it isn't coming from their trash right now, its in the plumbing.

Oh, and when the trash did stink, guess who lost? Starts with an R.

Heads up:
RWSA has a Bond Validation hearing scheduled for April 19, 4pm in Albemarle Circuit Court on a motion for judgement that includes the following terms:

MOTION FOR JUDGEMENT (full text at http://rivanna.org/home.htm)
pp 2-3
B. All proceedings of the Authority heretofore taken in connection
with or related to the authorization and issuance of the Bonds and
all pledges of revenues and other security for the Bonds including,
without limitation, all leases, agreements, permits, rights and
permissions heretofore entered into by or obtained by the
Authority related to the Project.
B5: pg 4
All of the foregoing leases, agreements, permits and approvals are expected to be pledged as security for the Bonds.

"Without limitation"? What happens if RWSA defaults? Who can buy the permits, water rights, and other property owned by the city but leased for $1/year to RWSA for the next 40+ years? Nestle?

Comment

Bankruptcy is exactly the situation that would lead to arguments for the privatization of our water supply. A company like Nestlé Waters would love to come in and help us out of that problem.

I have had my own legal troubles from
Time to time.
Know a little bit about local codes and the
The court system.
Still can't understand what was the problem
With my routine in Philadelphia and New York
That got everyone riled up.
" to come is a preposition" was a very funny routine.
Glad that first amendment lawyers like Albert Bendich
Martin Garbus and EPhraim London

Have to say I read that lawsuit about the water.
Weak ...very weak...

The wise Lorax, above, has uncovered a typical Goldman Sachs dirty trick. Sell debt that they know will fail and then buy up the assets cheep. Maybe the gang of three councilors has not protected the city. Do they understand contracts. Do they have any corporate experience? Do they listen to reason or just operate on emotion and sentiment ? Dede Smith and Dave Norris are keepers but the gang of three, well consult the records.

We have a lot of great local documentary film makers. I'd love to see one or more of them make a film about this issue. I think that would open the eyes of a lot of people who have been too lazy to read for themselves and would bring some attention from outside of the area to what's been going on here.

A couple of things:

The van der Linde settlement was not a victory for the RSWA. They knew that if the thing went to trial the truth would come out and they would be screwed. So they had a secret settlement which is hidden from the public. So RSWA hid the truth, Allied hid the truth and avoided a possible big financial hit, and van der Linde settled so he could get on with his life and avoid further legal fees. Everybody won except the taxpayers who were kept in the dark. Also it was $600,000 not $900,000. Later the City picked van der over RSWA to handle waste disposal. Then van der Linde's trucks were vandalized. The whole thing stunk.

I heard on the radio this morning that Huja is encouraging people to save water. With his new dam I can let the spigots run wide open 24/7. What a hypocrite.

The way Huja and friend have things set up, saving water will only mean that your rates will go up to make up for decreased revenues. You're screwed either way!

Nancy Drew-

You hit it on the head: "What City official with half a brain would agree to such a deal ?"

If you really want to help your city, start raising a fund to buy/implant some brain material and get your City Councilors filled up to half a brain.