07 A Charlotte Interlocal Agreement

1
STATE OF NORTH CAROLINA
CITY OF CHARLOTTE
COUNTY OF MECKLENBURG

AMENDED AND RESTATED AGREEMENT FOR
OPERATION OF A SINGLE STORM WATER SYSTEM
IN MECKLENBURG COUNTY

THIS AMENDED AND RESTATED AGREEMENT (“Agreement”) made as of
____________________________, by and between MECKLENBURG COUNTY, a political
subdivision of the State of North Carolina (hereinafter “County”), and the CITY OF
CHARLOTTE, North Carolina, a municipal corporation of the State of North Carolina
(hereinafter “City”).

WITNESSETH:

WHEREAS, in 1993 the City and County executed an “Agreement for Operation of a
Single Storm Water System in Mecklenburg County”, which Agreement the parties desire to
amend and restate; and

WHEREAS, the purpose of this Agreement is to recognize that a single storm water
system exists in Mecklenburg County, and that the goal of the City of Charlotte and
Mecklenburg County is to provide comprehensive storm water services in an efficient, effective,
and equitable manner; and

WHEREAS, the Charlotte City Council and Mecklenburg County Board of
Commissioners believe the most equitable source of revenue for storm water services to be
primarily storm water service fees assessed on the basis of contribution of runoff from each
property; and

WHEREAS, North Carolina General Statutes 153A-277 and 160A-314 require that no
storm water service fee may be levied whenever two or more units of local government operate
separate structural and natural storm water and drainage system services in the same area within
a County unless units of local government allocate among themselves the functions, duties,
powers, and responsibilities of jointly operating a single system within the same area; and

WHEREAS, the County and City currently have certain distinct responsibilities in
connection with the operation, maintenance and financing of separate systems; and

WHEREAS, the purpose of this Agreement is to continue the single storm water public
enterprise created by the parties in 1993 in Mecklenburg County, to allocate storm water
responsibilities, and to establish the method and responsibilities for financing and operating a
single, comprehensive storm water quantity and quality management program in Mecklenburg
County.

2
NOW, THEREFORE, IN CONSIDERATION OF THE PREMISES AND
FULFILLMENT OF THE TERMS OF THIS AGREEMENT, THE COUNTY AND CITY
AGREE AS FOLLOWS:

1. Major system - The County shall be responsible for operation and maintenance of
the major system (defined as streams having a watershed greater than one square mile) in the
unincorporated areas of the County, and within the corporate limits of such municipalities as
may by interlocal agreements with the County agree for the County to operate and maintain the
major system within such municipalities. The County shall establish levels of service and cost,
prioritize, schedule, and manage activities related to the major system and shall be responsible
for financial accounting of associated revenues. The City of Charlotte hereby allocates
responsibility for the major system within the corporate limits of the City as they may change
from time to time as the result of annexation or otherwise to the County.

2. Minor system - The County shall be responsible for operation and maintenance of
the minor system (defined as streams and drainage systems with a watershed of less than one
square mile) in the unincorporated areas of the County, and within the corporate limits of such
municipalities as may by interlocal agreements with the County agree for the County to operate
and maintain the minor system within such municipalities. The County shall establish levels of
service and cost, prioritize, schedule, and manage activities related to the minor system in
unincorporated areas, and shall be responsible for financial accounting of associated revenues.
The City hereby retains responsibility for the minor system and shall establish levels of service
and cost, prioritize, schedule, and manage activities relating to the minor system within the
corporate limits of the City as they may change from time to time as the result of annexation or
otherwise.

3. Charlotte-Mecklenburg Storm Water Services - The storm water services to be
provided pursuant to this Agreement shall be conducted as a public enterprise to be known as the
Charlotte-Mecklenburg Storm Water Services.

4. Water quality - The City is responsible for protecting and restoring the quality of
storm water runoff and surface waters as required by the Clean Water Act and associated
regulations promulgated by the United States Environmental Protection Agency and/or the State
of North Carolina, and other laws and regulations that may apply. The County is responsible for
protecting and restoring the quality of storm water runoff and surface waters as required by the
Clean Water Act and associated regulations promulgated by the United States Environmental
Protection Agency and/or the State of North Carolina, and other laws and regulations that may
apply.

5. Financing - Pursuant to N.C.G.S. 153A-278 and 160A-314, the County shall,
unless otherwise provided by this Agreement, establish, revise, charge, and collect storm water
fees and issue, where appropriate, storm water credits for property in the unincorporated areas of
the County, and within the corporate limits of the City and such other municipalities as may by
interlocal agreement with the County request the County to operate and maintain all or a portion
of the storm water system within such municipalities. Storm water fees shall be a periodic
service charge which shall consist of three components as follows:

3
i) Fixed and Administrative Cost Component shall be used to pay those expenses
that are not influenced by the amount of impervious area on a parcel of property,
including but not limited to the cost of producing bills and collecting fees, and
operating customer service functions (hereinafter referred to as the “Billing
Services”). Funds resulting from the Fixed and Administrative Cost Component
of the fees shall be used only for Billing Services. Costs associated with this
component shall be updated annually and incorporated into an annual budget
according to the process detailed in the Charlotte-Mecklenburg Billing and
Collections Cost Allocation Methodology Document (“Methodology Document”)
attached hereto as Exhibit A and incorporated herein by reference. The City and
County Managers must agree on this annual budget prior to the beginning of the
next fiscal year. If the City and County Managers cannot agree on a budget, the
Mayor shall appoint two City Council Members and the Chairman of the Board of
County Commissioners shall appoint two County Commissioners to meet together
and work with the Managers on resolving the issue. The Managers shall approve
any budget recommended by a majority of the members of this six-member
group. In the event that the annual budget has not been agreed upon by the City
and County Managers prior to the beginning of a fiscal year, the City and County
shall proceed as if the prior year’s budget is continued. By mutual consent of the
City and County Managers, (a) the Methodology Document may be amended and,
as amended, be substituted for the immediately prior version and attached hereto
as Exhibit A, and (b) funds from the Major System Cost Component and the
Minor System Cost Components may be used to pay a portion of the cost of the
Billing Services.

ii) Major System Cost Component shall be used to pay those expenses incurred in
master planning, operating and maintaining streams with a watershed greater than
one square mile. The Major System Cost Component of the service charge shall
be a flat amount for single family residences (regardless of the amount of
impervious area on the property); and for all other property, shall be based on a
flat amount for each 2613 square feet of impervious area, and a prorata share for
each portion thereof. In accordance to this Agreement, revenues from the Major
System Cost Component shall be distributed to the County for usage in the
Mecklenburg County Storm Water Special Revenue Fund.

iii) Minor System Cost Component shall be used to pay those expenses incurred in
master planning, operating and maintaining drainage systems with a watershed of
less than one square mile. The Minor System Cost Component of the service
charge shall have two rates for single family residences, one amount for those
with less than 2,000 square feet of impervious area, and a higher amount for those
with 2,000 square feet or more. For all other property, the charge shall be based
on a flat amount for each 2613 square feet of impervious area, and a prorata share
for each portion thereof. Revenues from the Minor System Cost Component
collected within the corporate limits of the City shall be distributed to the City for
providing minor system services within its corporate limits.

4
On or before April 15 of each year during the budget process, the County shall
ask the City if it wishes to alter the Minor System Cost Component. If the City
requests that the County alter the Minor System Cost Component levied within
the corporate limits of the City, the Board of County Commissioners shall
schedule a joint public hearing on the alteration in the service charge at a time
which is mutually convenient. Following the hearing the Board of County
Commissioners shall alter the Minor System Cost Component of the service
charge to be levied within the City after it receives notification from the City
Council of the desired alteration in the Minor System Cost Component. The
Board of County Commissioners shall attempt to schedule the public hearing
before May 15 so that changes made in the Minor System Cost Component can be
placed into the budget for the next fiscal year.

In the event a change is requested separate from the annual budget process, the
County shall conduct such public hearings and other measures as required by the
North Carolina General Statutes to establish new charges within sixty (60) days of
the City’s request.

6. Credits – Properties subject to storm water service charges may be granted credits
against the fee in accordance to the credit policy jointly approved by the Charlotte City Council
and Mecklenburg County Board of Commissioners. The credit shall be applied to charges for
both the major and minor systems.

The City hereby retains the responsibility for reviewing and approving credit applications within
the City for both the Major and Minor System Cost Components of the service charge.

7. Billing - Pursuant to NCGS 153A-277 and 160A-314 under this Agreement the
County has primary responsibility for the Billing Services. However, until otherwise provided
pursuant to this Agreement, the County agrees that the City shall perform the Billing Services
throughout the unincorporated areas of the County as well as the City. In addition, the City will
also perform the Billing Services for other client municipalities which contract with the County
to operate and maintain storm water systems provided said provisions are agreed to in writing by
City and County Managers.

In the event the County decides to perform the Billing Services itself, or the City chooses to
discontinue performing the Billing Services for the County, that party shall give written notice
three hundred sixty (360) days before said change to the other party’s Manager. The change can
only be effective at the beginning of a fiscal year (i.e., July 1). Within one hundred twenty (120)
days of said change, the City shall submit a schedule showing the costs associated with the
Billing Services that have been incurred and unrecovered by the City. These costs shall include
operational costs in excess of the annual budget, not to exceed five percent (5%) of the annual
budget; unpaid capital expenses, as described in Exhibit A; and system termination costs, as
described in Exhibit A. Final settlement is required within sixty (60) days of the submission of
costs.

8. Billing and Collection System Costs – The County shall pay the total costs for
charges necessary to provide the Billing Services for the County and its other municipal
participants. In the event the County or one of its municipal clients requests an individual change

5
or changes to the Billing Services, the Methodology Document, as described in Exhibit A, will
be used to develop a proposed budget and shall be agreed to by the City and County Managers.
The County’s final payment to the City for these costs will be addressed as part of the annual
final settlement.

9. Distribution of Revenues – So long as the City is responsible for the Billing
Services, before the distribution of storm water fees collected for the County or a municipality
serviced by the Charlotte-Mecklenburg Storm Water Services, the City shall deduct the Fixed
and Administrative Cost Component. The City shall also deduct the Minor System Cost
Component collected to provide storm water services within the corporate limits of the City as
described in Section “5.iii” of this Agreement. Net revenues shall be distributed to the County
by the 25th of each month for usage in the Mecklenburg County Storm Water Special Revenue
Fund.

Within one hundred twenty (120) days of the close of the fiscal year, the City shall submit a
schedule showing the cost actually incurred for providing Billing Services as described in
Section 5.iii, and the amount over and under the annual budget for such services. Final
settlement is required within sixty (60) days of the submission of such information.

The County shall have no obligation to pay any amount for Billing Services which is more than
five percent (5%) greater than the annual budget as described in Section “5.i” of this Agreement
unless mutually agreed upon in writing by the City and County Managers. In the event actual
costs incurred for Billing Services are less than the budget, the difference between the budgeted
amount and the actual costs for providing the service will be remitted to the County within sixty
(60) days of the submission of such information. Any Fixed and Administrative Cost
Component revenues not spent in the year collected can be used only for Billing Services.

If there is a change in the Billing Services provider pursuant to the provisions of Paragraph 7, the
County shall distribute the City’s Minor System Cost Component revenues by the 25th of each
month following the last billing cycle or on the first business day thereafter.

10. Indemnity of Each Party – County agrees to indemnify and hold City harmless
from and against any and all claims, liabilities, damages and expenses, including attorneys fees,
arising from the County’s operation of its major system within the corporate limits of the City
and from the County’s use of revenue raised from the major system cost component of the
service charge. City agrees to indemnify and hold County harmless from and against any and all
claims, liabilities, damages and expenses, including attorneys fees, arising from the City’s
operation and maintenance of the minor system in the City and from the City’s use of revenues
raised from the minor system cost component of the service charge.

11. Charlotte-Mecklenburg Storm Water Advisory Committee – A nine member
citizens advisory committee shall be established with representatives of the following categories:

schools, colleges, hospitals, or churches – 1 member (individual to be employed full
time by the institution or be a board member or officer of the institution);

6
industry, manufacturing, or commercial – 1 member (individual to be employed full
time in the management and/or operation of industrial, manufacturing, or commercial
property);

environmental organizations – 1 member (individual to be a member of a generally
recognized organization involved in environmental issues);

financial, accounting, or legal professional – 1 member (individual to be employed
full time in providing financial, accounting or legal services);

developer or land development design professional – 1 member (individual to be
employed full time in land development or the design of building or land
improvements);

general contractor – 1 member (individual to be employed full time as a construction
contractor);

residential neighborhoods – 3 members (individuals shall not qualify for one of the
other categories).

The members shall be appointed as follows:

3 members by the Charlotte City Council;

3 members by the Mecklenburg Board of County Commissioners;

1 member by the towns in the northern part of Mecklenburg County as determined by
the northern towns;

1 member by the towns in the southern part of Mecklenburg County as determined by
the southern towns; and

1 member by the eight previously appointed members above.

The initial determination of specific categories to be appointed by the County and City will be
determined by lottery after the two appointments are made by the towns in accordance with the
above listing. The ninth member appointed by the Committee must represent the category not
filled by the City, County or Town appointments. The members shall serve staggered, three year
terms such that three members are appointed each year. The categories of the three members to
be appointed each successive year shall be allocated to the City, County, and towns or
Committee by lottery. In the event a jurisdiction cannot identify a candidate for the category
assigned by the lottery, a “residential neighborhood” representative may be appointed. The
Committee position will revert back to the assigned category at the expiration of the term.

No member may be appointed to more than two full or partial terms. Any member who fails to
attend at least seventy-five percent of the regular and special meetings of the Committee during

7
any calendar year shall be automatically removed from the Committee. The Committee shall
select a Chairperson each year from its own members by majority vote. Each member will
continue to serve until 1) his or her term has expired and a successor has been appointed; 2) his
or her resignation; or 3) his or her removal. If a vacancy on the Committee occurs resulting from
resignation or removal, a person will be appointed to complete the unexpired term associated
with such vacant position in the same manner as such position was originally filled. The
successor must represent the same category.

A majority of the membership constitutes a quorum. Every action of the Committee requires the
concurring votes of at least five members. The Committee may adopt its own rules of procedure
which may not be inconsistent with the terms of this Agreement. The responsibilities of the
Advisory Committee shall be as follows:

Policy. Review and recommend to the City Council and Board of County
Commissioners storm water management policies, policy changes, long-range plans, and
their budgetary and rate impacts. The recommendations are to conform, in nature, to the
successful operation of a single utility in Mecklenburg County and provide consistent
guidelines and design principles for the community.

Capital Improvements. Review and comment to the City Council and Board of County
Commissioners on capital improvement programs. These capital improvement programs
should be reviewed and evaluated on the basis of a comprehensive storm water quantity
and quality management program in Mecklenburg County.

Operations Program. Review and comment to the City Council and Board of County
Commissioners on the annual operating budget for their respective service charge areas
including but not limited to public education activities, customer service, and the billing
and collections system.

Storm Water Appeals. Hear appeals and reach decisions on: service charges, credits, and
adjustments. Hear requests for changes from City and County staffs and from private
parties, and make recommendations to the City Council and Board of County
Commissioners on the following matters: the application, modification and enforcement
of storm water policies. These policies should be reviewed and evaluated on the basis of
a comprehensive storm water quantity and quality management program in Mecklenburg
County.

SWIM Buffer Appeals and Variances. To the extent provided in the City Zoning
Ordinance and/or the County Zoning Ordinance and/or the zoning or land use ordinance
of any town located in Mecklenburg County, to hear and decide appeals and variance
requests with respect to the SWIM buffer provisions of said ordinances.

Floodplain Regulation Appeals and Variances. To the extent provided in the City
Floodplain Regulations and/or the County Floodplain Regulations and/or the floodplain
regulations of any town located in Mecklenburg County, to hear and decide appeals and
requests for variances.

8
Soil Erosion and Sedimentation Control Ordinance Appeals. Hear appeals as provided in
the City and County Soil Erosion and Sedimentation Control Ordinances.

Councils, Commissions, and Staff Resource. Respond to City Council, Board of County
Commissioners and staff requests for advice on matters related to the comprehensive
storm water quantity and quality management program in Mecklenburg County.

Reporting. Present the City Council and Board of County Commissioners with an annual
report of key actions and issues.

For purposes of hearing these appeals and variances, to the extent necessary, the Advisory
Committee shall be and function as a joint municipal county planning agency as specified in G.S.
160A-362, performing the functions of a board of adjustment as authorized by G.S. 160A-388.
Overall administration and support of the Advisory Committee shall be provided by the County.
City staff shall present all matters associated with the City’s program directly to the Committee,
including but not limited to reports, recommendations, budgets, and appeals.

12. Ownership of Real Property Involved in Undertaking. City shall have no
ownership in any real property acquired by County for the operation of the major drainage
system, and the County shall be free to dispose of such real property to the extent and under
procedures allowed by State law. County shall have no ownership in any real property acquired
by City for the operation of the minor drainage system, and the City shall be free to dispose of
such real property to the extent and under procedures allowed by State law. However, the City
and County shall cooperate with each other by granting access to property when necessary for
operation of the major and minor drainage systems.

13. Methods of Amending this Agreement. This Agreement may be amended by
written agreement authorized by the governing bodies of each party and signed by authorized
representatives of both parties.

14. Term of Agreement – Methods of Terminating the Agreement. The initial term
of this Agreement shall be from July 1, 2002 to June 30, 2003, and shall be automatically
renewed each fiscal year thereafter unless notice of non-renewal is given in writing at least 18
months prior to the beginning of the fiscal year when termination is intended. This Agreement
may also be terminated by court order upon the finding that there has been substantial breach of
this agreement by the non-complaining party so as to entitle the complaining party to be relieved
of its obligations under this Agreement.

15. Enforcement of Agreement. The parties agree that the remedy of specific
performance would be an appropriate remedy, among others, for the enforcement of this
Agreement. The parties agree that the effect of this Agreement is to consolidate the storm water
management services such that the Joint Resolution for Joint Operation of a Single Storm Water
System Within the City Limits adopted by the Board of County Commissioners and the City
Council, dated November 9, 1992, shall cease to be in effect from and after January 1, 1994.

16. Entire Agreement. This Agreement is the entire agreement of the parties.

9
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
as of the day and year first above written by the authority duly granted by their respective
governing bodies.

Approved as to form: Mecklenburg County

___________________________________ ____________________________________
County Attorney Chairman, Board of County Commissioners

____________________________________ ____________________________________
Director of Finance Clerk to the Board
Mecklenburg County

City of Charlotte

____________________________________
Mayor

____________________________________
City Clerk

10

Exhibit A

Charlotte-Mecklenburg Billing and
Collections Cost Allocation Methodology
Document