THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, July 16, 1995 TAG: 9507190606
SECTION: VIRGINIA BEACH BEACON PAGE: 06 EDITION: FINAL
LENGTH: Long : 244 lines
Following are excerpts from recent documents in the everlasting Gaston pipeline proceedings that indicate to some small degree areas of dispute.
WHAT NORTH CAROLINA SAYS...
Third Motion for Evidentiary Hearings
By the State of North Carolina before the Federal Energy Regulatory Commission
July 10, 1995
The fact that the (mediated) settlement died because of a procedural wrangle within the Virginia government clearly casts doubt upon Virginia Beach's longstanding assertion that it ``urgently, even desperately needs'' its pipeline project.
Virginia Beach's position is also called into question by the repeated statements of the city of Norfoilk, Virginia (``Norfolk'') that the proposed pipeline would create a ``surplus'' within the region. Indeed, Virginia Beach admits that its ``need'' for water could be met in the near term simply by extending its current water purchase contract with Norfolk, albeit at a cost exceeding the cost of moving water through the pipeline ($6 million per year).
These two facts . . . make it abundantly clear that Virginia Beach's pipeline project is not about the need for incremental water supplies in the region; it is about money. . . . The project is not needed to avert a water crisis; it is needed so that Virginia Beach need no longer purchase water from Norfolk. . . .
It is North Carolina's position that Virginia Beach has not shown a need for incremental water supplies sufficient to justify construction of the proposed pipeline now or any time in the future. . . .
The water use data supplied by Virginia Beach and other Southeastern Virginia jurisdictions supporting the pipeline . . . is (sic) both outdated and incorrect. For example, Virginia Beach has asserted, and staff has projected, that water use in Southeastern Virginia will increase rapidly after 1990. Although it is now 1995, the data for the most recent years (1991-1995) was (sic) apparently not made available to or sought by FERC staff and is certainly not reflected in the FEIS (Final Environmental Impact Statement) analysis.
However, post-1990 data is available and shows that water use has not increased rapidly since 1990 (as evidently asserted by the five cities submitting data to FERC) but has in fact declined as a result of water conservation measures and lower than expected population growth. . . . Through the first four months of 1995, water use is below 1994 levels for each and every month. . . .
WHAT VIRGINIA BEACH SAYS . . .
TO: The Hon. Elizabeth A. Moler, Chair
Federal Energy Regulatory Commission
Washington, D.C. 20426
FROM: Samuel M. Brock III, Esq.
Mays & Valentine,
Attorneys for Virginia Beach
DATE: July 6, 1995
. . . Virginia Beach is now in its fourth year of mandatory water use restrictions and a moratorium on extensions of its water system. Under the best of circumstances, those conditions will continue for another 2 1/2 years. Every day of delay carries with it the additional risk of a water-supply catastrophe for all of Southeastern Virginia. . . .
If the commission issues a final order approving VEPCO's applications by the end of July, the city should be able to finish construction and bring the project on-line by the summer of 1998. . . . Any delay (of the FERC permit) beyond July would force Southeastern Virginia to remain under a continuing risk of water supply failure through the entire summer of 1998 and perhaps beyond, and would impose a significant economic hardship on Virginia Beach as well. Virginia Beach's water supply contract withNorfolk expires on June 30, 1998. To ensure the availability of that supply beyond June 30, 1998, Virginia Beach must commit by Dec. 31, 1995, to extend the contract for an additional year - and to pay a charge of approximately $6 million (over and above Norfolk's cost of service) . . .
North Carolina, long the city's principal antagonist, now has acknowledged by its actions that the threat of environmental harm to the Roanoke Basin from Virginia Beach's proposed 60 mgd withdrawal is illusory. Under the terms of the tentative agreement, North Carolina agreed to Virginia Beach's 60 mgd withdrawal and insisted on the right to withdraw an additional 15 mgd through the pipeline for use in Northeastern North Carolina, as well as yet another 20 mgd from the upper basin for use elsewhere in North Carolina.
Moreover, after Virginia Beach and North Carolina reached their tentative agreement, including the provisions for additional withdrawals, none of the state and federal resource agencies commented negatively on the city's project.
The ultimate reason that the settlement failed was related to Virginia partisan politics and not to the merits of the city's project. The effort to effectuate the settlement was complicated (before it failed) by the opposition of several Virginia localities (primarily the city of Norfolk and various upper Roanoke Basin localities) to one or more terms of the settlement.
Norfolk objected to a provision of the settlement which required it to agree not to sell any of its ``surplus'' water outside of Southeastern Virginia or Northeastern North Carolina - even though . . . there is no market outside Southeastern Virginia for Norfolk's ``surplus'' and it all will be needed within the region to meet local demands.
The upper basin localities have long opposed the city's project, and they opposed the proposed interstate compact on the ground that Virginia Beach's withdrawals, plus potential additional withdrawals of up to 35 mgd for out-of-basin use by North Carolina, would interfere with future economic development in their jurisdictions. None of these disputes demonstrates in any way that any environmental harms will result from the city's project. They do show, however, that the controversies surrounding the city's project continue to arise from provincialism, economic competition and power politics, as they have for well over a decade . . .
. . . (D)espite the failure of the tentative settlement . . . Virginia Beach now is committing voluntarily to perform every environmental feature of the failed settlement that it is able to perform. . . . (T)hose commitments are to implement environmental enhancements which will reduce the overall, net environmental impacts caused by the project (which of course are not significant even without those enhancements). . . . (I)mplementation of these measures should dispel any legitimate concerns of project opponenots and should satisfy all possible remaining concerns of any state and federal resource agencies.
The only provisions of the tentative settlement that Virginia Beach will not implement are those which it cannot implement or which would not enhance the environment. Those are (1) commitments from Norfolk, primarily that Norfolk would not sell any surplus water outside of Southeastern Virginia; (2) enactment of an interstate compact by the Commonwealth of Virginia, (3) allowing North Carolina to use Virginia Beach's pipeline to transport an additional 15 mgd from Lake Gaston to Northeast North Carolina and (4) supporting the improvement of highways from Chesapeake to Northeast North Carolina. . . .
North Carolina could have saved the ammunition that it used to attack potential future ``surplus water'' sales outside Southeastern Virginia, for several reasons - primarily because any such ``surplus'' is temporary at best and illusory at worst. Even in the early years that the Gaston pipeline is in operation, Norfolk will have little if any ``surplus water'' in times of drought, and any drop of ``surplus'' water that now is available under drought conditions will be needed to meet local demands in Southeastern Virginia by the year 2030 if not sooner.
Moreover, North Carolina stated in a July 6, 1995, press release . . . that (it) ``will review all of Virginia's water withdrawals from North Carolina rivers or other water sources that affect North Carolina, including the Nottoway, Blackwater and Chowan rivers.'' . . . (I)t is a clear threat to seek reductions in the amounts of water currently available in Southeastern Virginia. . . . Norfolk's withdrawals from the Nottoway and Blackwater rivers are key components of its water-supply system, and the reference to rivers ``or other water sources'' appears to address existing goundwater uses in Southeastern Virginia as well. . . .
North Carolina does not seek to restrict Norfolk's water-service area to preserve the Roanoke River environment, or it would resist potential interbasin transfers in North Carolina as vigorously as it has resisted Virginia Beach's project. Instead, it attempted to use the mediation-settlement process as a vehicle to facilitate potential future interbasin withdrawals in North Carolina. . . .
Any further attempt to restrict Norfolk's water service area also should be rejected . . .
Virginia Beach currently buys 30 mgd from Norfolk under normal conditions; in a drought, however, Norfolk's current ``surplus'' may be as little as 15 mgd. . . . Norfolk's future surplus (excess of available treated water over local demands) will be no more than 15 mgd in the early years of the pipeline (under drought conditions), and the combined regional demands will equal or exceed the combined supplies provided by the region's public water systems (again, under drought conditions) by the year 2010 - meaning that every drop of ``surplus'' water that Norfolk can muster will be needed to meet regional demands, and no regulatory or contractual restrictions are needed to keep that water in the region. . . .
The principal ``potential customer'' that Norfolk has identified . . . (Newport News) . . . (has) no desire and no intention to make the enormous capital investments that would be required . . . for the purpose of developing a temporary water supply that could be reduced or even terminated during droughts . . . and which would disappear entirely within approximately 15 years. . . .
Norfolk's is the only existing supply for Virginia Beach's water; its water sales are not regulated by any public service commission; and it can and does exact monopoly rents for that essential resource. Norfolk current charges Virginia Beach $6 million per year, over and above its cost of service (including return on investment) - a profit of approximately 40% - for 30 mgd, and it has stated that this price will escalate at the rate of 5% per year. Virginia Beach cannot afford, and would have trouble financing, a $150 million pipeline that could not be used until a far more expensive source of water was exhausted.
WHAT FERC'S IMPACT STUDY SAYS . . .
Final Environmental Impact Statement
FERC
July 1995
This FEIS evaluates the five-city area's need for water by analyzing the supply and demand projections of previous water supply studies using more recent population and per-capita water-use information. Information in this FEIS shows that the five-city area's actual 1990 population exceeded the Corps' (of Engineers) 1984 projection by over 80,000 people. In addition, recent population projections by the U.S. Bureau of Economic Analysis, the Virginia Employment Commission and the Hampton Roads Planning District Commission all project the area's 2030 population to exceed the Corps' projection. As a result of these higher population projects, we estimate that the area's 2030 demand to be in excess of the Corps' original projections. Accordingly, staff concludes that the five-city area will need the 60 mgd that would be supplied by the proposed Lake Gaston diversion.
WHAT FERC'S INITIAL ASSESSMENT SAYS...
Final Environmental Assessment
FERC
June 1994
North Carolina contends that, regardless of the original validity of the projections, conditions have changed that justify a lowering of previous projections, reducing the urgency of need for water from Lake Gaston. Specifically, North Carolina notes that the Corps (of Engineers) (1) made the projections during a time of economic prosperity and that subsequent recessionary times have reduced the rate of current and anticipated growth in the region; and (2) made the projections during a time of military buildup and that the current downsizing of the Navy can be expected to reduce demand in the region. . . .
(N)o evidence has been presented to suggest that future demand will deviate significantly from previous projections. Furthermore, despite an overall downsizing of the Navy, there is no indication that the demand of the facilities in this area can be expected to decrease substantially (Base Realignment and Closure Commission, Preliminary BRAC 1993 Closure and Realignment Recommendfation Impacts by State, March 11, 1993). Staff finds that changes to economic conditions may affect the exact timing, but not the overall need, for the project.
North Carolina suggests that surplus from the Norfolk system could continue to be used to assist in meeting demand, even if the relative magnitude of that contribution to Virginia Beach's total supply were to diminish. Staff notes, however, that this surplus is neither guaranteed over the length of the analysis nor in times of drought, and, consequently, could not be counted upon to provide a reliable water supply for Virginia Beach. . . .
One commentor raised a concern about the economic losses of future income that could occur within the project area (the Roanoke River basin) as a result of the out-of-basin transfer. This would happen if the transfer of water prevents future economic development from occurring within the project area that would otherwise occur there. The transfer of water out of the project area would not adversely affect future economic development within it. There would be more than enough water available to meet future consumptive demands produced by economic development within the project area. . . .
The terminus area (Southeastern, Tidewater Virginia) experienced rapid population growth during the 1980s, fueled principally by development in Virginia Beach, as shown by the annual growth rate of 3.75 percent. . . . Since 1990, population growth has continued, but at a lower rate than during the 1980s. Between 1986 and 1994, the labor force in the terminus environment has grown at an annual rate of slightly under 4 percent, indicating that economic growth may be exceeding population growth, drawing more residents into the labor force.
Population in Virginia Beach is projected to grow at an annual rate of 1.9% between 1992 and 2010. This fact, combined with the higher employment growth rate, indicates that there is still a need for 60 mgd of water that will be provided by the proposed action. The slower growth will merely delay the time at which this full amount of water is needed.
KEYWORDS: LAKE GASTON WATER SUPPLY PLAN by CNB