WQ0019907_Final Permit_20170308

1
Water Resources
ENVIRONMENTAL QUALITY
March 8, 2017
EDWARD CARON—UTILITY SUPERINTENDENT WASTEWATER
ONSLOW WATER AND SEWER AUTHORITY
POST OFFICE Box 1415
JACKSONVILLE, NORTH CAROLINA 28540-1415
Dear Mr. Caron:
ROY COOPER
Governor
MICHAEL S. REGAN
Secretary
S. JAY ZIMMERMAN
Director
Subject: Permit No. WQ0019907
Holly Ridge WWTP
Wastewater Irrigation System
Onslow County
In accordance with your permit renewal request received February 28, 2017, we are forwarding
herewith Permit No. WQ0019907 dated March 8, 2017, to the Onslow Water and Sewer Authority for the
continued operation of the subject wastewater treatment and irrigation facilities.
This permit shall be effective from the date of issuance until February 28, 2022, shall void Permit
No. WQ0019907 issued May 10, 2007, and shall be subject to the conditions and limitations as specified
therein. Please pay particular attention to the monitoring requirements listed in Attachments A, B and C
for they may differ from the previous permit issuance. Failure to establish an adequate system for collecting
and maintaining the required operational information shall result in future compliance problems.
Please note that Permit Condition IV.I4. (d) requires notification of the Wilmington Regional
Office any time that self -monitoring information indicates that the facility is out of compliance with its
permit limits, including freeboard measurements
Please note the following permit conditions have been removed since the last permit issuance
dated May 10, 2007:
➢ Old Condition 1.1. — This condition has been removed.
Please note the following permit conditions are new since the last permit issuance dated May
10, 2007:
➢ Condition L2. — This condition describes the schedule for activating the Summerhouse WWTF.
➢ Condition IV.8. — This condition requires the submission of an annual report.
➢ Condition IV.9. — This condition requires maintaining a record of all residuals removed.
➢ Condition IV.10. —This condition requires maintaining a maintenance log of the facility.
-"--�'" NothhgCompares`._.,
State of North Carolina I Environmental Quality I Water Resources I Water Quality Permitting I Non -Discharge Permitting
1617 Mail Service Center I Raleigh, North Carolina 27699-1617
919-807-6332

Mr. Edward Caron
March 8, 2017
Page 2 of 2
➢ Condition VI.8. —This condition allows permit revocation or modification in certain situations.
➢ Condition VI.9. — This condition notifies the Permittee that, unless the Division Director grants
a variance, expansion of the permitted facilities contained herein shall not be granted if the
Permittee: has been convicted of an environmental crime; has previously abandoned a
wastewater treatment facility; has not paid a civil penalty; is non -compliant with a permit
schedule; or has not paid an annual fee.
If any parts, requirements or limitations contained in this permit are unacceptable, the Permittee
has the right to request an adjudicatory hearing upon written request within 30 days following receipt of
this permit. This request shall be in the form of a written petition, conforming to Chapter 150B of the North
Carolina General Statutes, and filed with the Office of Administrative Hearings at 6714 Mail Service
Center, Raleigh, NC 27699-6714. Unless such demands are made, this permit shall be final and binding.
If you need additional information concerning this permit, please contact David Goodrich at (919)
807-6352 or david,[e-mail].
Sincerely,
6 S. Jay Zimmerman, P.G., Director
Division of Water Resources
cc: Onslow County Health Department (Electronic Copy)
Wilmington Regional Office, Water Quality Regional Operations Section (Electronic Copy)
Digital Permit Archive (Electronic Copy)
Central Files

NORTH CAROLINA
ENVIRONMENTAL MANAGEMENT COMMISSION
DEPARTMENT OF ENVIRONMENTAL QUALITY
RALEIGH
WASTEWATER IRRIGATION SYSTEM PERMIT
In accordance with the provisions of Article 21 of Chapter 143, General Statutes of North Carolina as
amended, and other applicable Laws, Rules and Regulations
PERMISSION IS HEREBY GRANTED TO
Onslow Water and Sewer Authority
Onslow County
FOR THE
operation of a 224,673 gallon per day (GPD) wastewater treatment and irrigation facility consisting of the:
continued operation of a 260,626 GPD wastewater treatment facility consisting of: headworks with a
manual bar screen and grit chamber; an ultrasonic flow meter; a 1.82 million gallon (MG) treatment lagoon
with three aeration cells (Cells 1 & 2 each have two 25 horsepower (hp) aerators with anti -erosion baffles,
Cell 3 has two 25 hp mixers with anti -erosion baffles), and a 0.49 MG settling cell; an ultraviolet ([TV)
disinfection system, a 22,400 gallon aerobic sludge digester with a 2 hp aerator and a 3 hp discharge pump;
an effluent pump station with two 450 gallon per minute (GPM) pumps; approximately 17,900 linear feet
(LF) of 8-inch force main; and all associated piping, valves, controls, and appurtenances; and the
continued operation of a 224,673 GPD wastewater irrigation facility consisting of: a 13.30 MG storage
lagoon (51 days storage); an irrigation pump station with two 700 GPM pumps and an effluent flow meter;
a 99.59 acre spray irrigation area with 11 fields; and all associated piping, valves, controls, and
appurtenances
to serve the Holly Ridge WWTP, with no discharge of wastes to surface waters, pursuant to the application
received February 28, 2017, and in conformity with the project plans, specifications, and other supporting
data subsequently filed and approved by the Department of Environmental Quality and considered a part
of this permit.
This permit shall be effective from the date of issuance until February 28, 2022, shall void Permit No.
WQ0019907 issued May 10, 2007, and shall be subject to the following specified conditions and
limitations:
I. SCHEDULES
No later than six months prior to the expiration of this permit, the Permittee shall request renewal of
this permit on official Division forms. Upon receipt of the request, the Division will review the
adequacy of the facilities described therein, and if warranted, will renew the permit for such period of
time and under such conditions and limitations as it may deem appropriate. Please note Rule 15A
NCAC 02T .0105(d) requires an updated site map to be submitted with the permit renewal application.
[15A NCAC 02T .0105(d), 02T .0106, 02T .0109, 02T .0115(c)]
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2. Within 30 days of permit issuance, the Summerhouse WWTF (Permit No. WQ0029945) shall be
restored to service capability, and will be available for a pre start-up inspection by Division personnel.
Upon Division inspection and approval, the facility will be activated. [15A NCAC 02T .0108(b)(2)]
H. PERFORMANCE STANDARDS
1. The subject non -discharge facilities shall be effectively maintained and operated at all times so there is
no discharge to surface waters, nor any contravention of groundwater or surface water standards. In
the event the facilities fail to perform satisfactorily, including the creation of nuisance conditions due
to improper operation and maintenance, or failure of the irrigation areas to adequately assimilate the
effluent, the Permittee shall take immediate corrective actions including Division required actions, such
as the construction of additional or replacement wastewater treatment or irrigation facilities. [G.S. 143-
215.1, 143-213.3(a)]
2. This permit shall not relieve the Permittee of their responsibility for damages to groundwater or surface
water resulting from the operation of this facility. [ 15A NCAC 02B .0200, 02L .0100]
3. All wells constructed for purposes of groundwater monitoring shall be constructed in accordance with
15A NCAC 02C .0108 (Standards of Construction for Wells Other than Water Supply), and any other
jurisdictional laws and regulations pertaining to well construction. [15A NCAC 02C .0108]
4. Effluent quality shall not exceed the limitations specified in Attachment A. [15A NCAC 02T
.0108(b)(1)]
5. Application rates, whether hydraulic, nutrient or other pollutant, shall not exceed those specified in
Attachment B. [15A NCAC 02T .0505(c), 02T .0505(n)]
6. This disposal system was individually permitted on or after December 30, 1983; therefore, the
compliance boundary is established at either 250 feet from the effluent disposal area, or 50 feet within
the property boundary, whichever is closest to the effluent disposal area. An exceedance of
groundwater standards at or beyond the compliance boundary is subject to remediation action according
to 15A NCAC 02L .0106(d)(2) as well as enforcement actions in accordance with North Carolina
General Statute 143-215.6A through 143-215.6C. [15A NCAC 02L .0106(d)(2), 02L .0107(b)]
7. In accordance with 15A NCAC 02L .0108, the review boundary is established midway between the
compliance boundary and the effluent disposal area. Any exceedance of groundwater standards at the
review boundary shall require action in accordance with 15A NCAC 02L .0106. [15A NCAC 02L
.0106, 02L .01081
8. The Permittee shall apply for a permit modification to establish a new compliance boundary prior to
any sale or transfer of property affecting a compliance boundary. [15A NCAC 02L .0107(c)]
9. In accordance with 15A NCAC 02L .0107(d), no wells, excluding Division approved monitoring wells,
shall be constructed within the compliance boundary except as provided for in 15A NCAC 02L
.0107(g). [15A NCAC 02L .0107]
10. Except as provided for in 15A NCAC 02L .0107(g), the Permittee shall ensure any landowner who is
not the Permittee and owns land within the compliance boundary shall execute and file with the Onslow
County Register of Deeds an easement running with the land containing the following items:
a. A notice of the permit and number or other description as allowed in 15A NCAC 02L .0107(f)(1);
b. Prohibits construction and operation of water supply wells within the compliance boundary; and
c. Reserves the right of the Permittee or the State to enter the property within the compliance boundary
for purposes related to the permit.
The Director may terminate the easement when its purpose has been fulfilled or is no longer needed.
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[15A NCAC 02L .0107(f)]
11. The facilities permitted herein shall be constructed according to the following setbacks:
a. The setbacks for irrigation sites permitted under 15A NCAC 02H .0200 shall be as follows (all
distances in feet):
i. Any habitable residence or place of public assembly under separate ownership: 400
ii. Surface waters: 100
iii. Any well with exception of monitoring wells: 100
iv. Any property line: 150
v. Public right of way: 50
[15A NCAC 02H .02190)]
b. The setbacks for storage and treatment units permitted under 15A NCAC 02H .0200 shall be as
follows (all distances in feet):
i. Any well with exception of monitoring wells: 100
ii. Any property line: 50
[I5A NCAC 02H .02190)]
III. OPERATION AND MAINTENANCE REQUIREMENTS
1. The facilities shall be properly maintained and operated at all times. The facilities shall be effectively
maintained and operated as a non -discharge system to prevent the discharge of any wastewater resulting
from the operation of this facility. The Permittec shall maintain an Operation and Maintenance Plan,
which at a minimum shall include operational functions, maintenance schedules, safety measures and
a spill response plan. [15A NCAC 02T .0507]
2. Upon the Water Pollution Control System Operators Certification Commission's (WPCSOCC)
classification of the subject non -discharge facilities, in accordance with 15A NCAC 08G .0200 the
Permittee shall designate and employ a certified operator in responsible charge (ORC) and one or more
certified operator(s) as back-up ORC(s). The ORC or their back-up shall visit the facilities in
accordance with 15A NCAC 08G .0200, and shall comply with all other conditions specified in the
previously cited rules. [15A NCAC 02T .0117]
3. A suitable year round vegetative cover shall be maintained at all times, such that crop health is
optimized, allows for even distribution of effluent and allows inspection of the irrigation system. [15A
NCAC 02T .0108(b)(1)]
4. Adequate measures shall betaken to prevent effluent ponding in or runoff from the irrigation sites listed
in Attachment B. [15A NCAC 02T .0108(b)(1)]
5. Irrigation shall not be performed during inclement weather or when the ground is in a condition that
will cause ponding or runoff. [15A NCAC 02T .0108(b)(1)]
6. All irrigation equipment shall be tested and calibrated at least once per year. Calibration records shall
be maintained at the facility for a period of no less than five years, and shall be made available to the
Division upon request. [15A NCAC 02T .0108(b)(1)]
7. Only effluent from the Holly Ridge WWTP shall be irrigated on the sites listed in Attachment B. [G.S.
143-215.1]
8. No automobiles or machinery shall be allowed on the irrigation sites except during equipment
installation or while maintenance is being performed. [15A NCAC 02T .0108(b)(1)]
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9. Public access to the irrigation sites and wastewater treatment facilities shall be prohibited. [15A NCAC
02T .0505(q)]
10. The residuals generated from the wastewater treatment facilities shall be disposed or utilized in
accordance with 15A NCAC 02T .1100. The Permittee shall maintain a residual management plan
pursuant to 15A NCAC 02T .0508. [15A NCAC 02T .0508, 02T .1100]
11. Diversion or bypassing of untreated or partially treated wastewater from the treatment facilities is
prohibited. [15A NCAC 02T .05050)]
12. Freeboard in the 1.82 million gallon (MG) treatment lagoon and the 13.30 MG storage lagoon shall not
be less than two feet at anytime. [15A NCAC 02T .0505(d)]
13. Gauges to monitor waste levels in the 1.82 million gallon (MG) treatment lagoon and the 13.30 MG
storage lagoon shall be provided. These gauges shall have readily visible permanent markings, at inch
or tenth of a foot increments, indicating the following elevations: maximum liquid level at the top of
the temporary liquid storage volume; minimum liquid level at the bottom of the temporary liquid
storage volume; and the lowest point on top of the dam. [15A NCAC 02T .0108(b)(1)]
14. A protective vegetative cover shall be established and maintained on all earthen embankments (i.e.,
outside toe of embankment to maximum allowable temporary storage elevation on the inside of the
embankment), berms, pipe runs, erosion control areas, and surface water diversions. Trees, shrubs, and
other woody vegetation shall not be allowed to grow on the earthen dikes or embankments. Earthen
embankment areas shall be kept mowed or otherwise controlled and accessible. [15A NCAC 02T
.0108(b)(1)]
IV. MONITORING AND REPORTING REQUIREMENTS
1. Any Division required monitoring (including groundwater, plant tissue, soil and surface water analyses)
necessary to ensure groundwater and surface water protection shall be established, and an acceptable
sampling reporting schedule shall be followed. [15A NCAC 02T .0108(c)]
2. A Division certified laboratory shall conduct all laboratory analyses for the required effluent,
groundwater or surface water parameters. [15A NCAC 02H .0800]
3. Flow through the treatment facility shall be continuously monitored, and daily flow values shall be
reported on Form NDMR.
The Permittee shall install and maintain an appropriate flow measurement device to ensure the accuracy
and reliability of flow measurement consistent with accepted engineering and scientific practices.
Selected flow measurement devices shall be capable of measuring flows with a maximum deviation of
less than ten percent from true flow; accurately calibrated at a minimum of once per year; and
maintained to ensure the accuracy of measurements is consistent with the selected device's accepted
capability. The Permittee shall maintain records of flow measurement device calibration on file for a
period of at least five years. At a minimum, documentation shall include:
a. Date of flow measurement device calibration,
b. Name of person performing calibration, and
c. Percent from true flow.
[I5A NCAC 02T .0105(k)]
4. The Permittee shall monitor the effluent from the subject facilities at the frequencies and locations for
the parameters specified in Attachment A. [15A NCAC 02T .0108(c)]
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5. The Permittee shall maintain adequate records tracking the amount of effluent irrigated. At a minimum,
these records shall include the following information for each irrigation site listed in Attachment B:
a. Date of irrigation;
b. Volume of effluent irrigated;
c. Site irrigated;
d. Length of time site is irrigated;
e. Continuous weekly, monthly, and year-to-date hydraulic (inches/acre) loadings;
f. Continuous monthly and year-to-date loadings for any non -hydraulic parameter specifically
limited in Attachment B;
g. Weather conditions; and
h. Maintenance of cover crops.
[I 5A NCAC 02T A 108(c)]
6. Freeboard (i.e., waste level to the lowest embankment elevation) in the 1.82 million gallon (MG)
treatment Iagoon and the 13.30 MG storage lagoon shall be measured to the nearest inch or tenth of a
foot, and recorded weekly. Weekly freeboard records shall be maintained at the facility for a period of
no less than five years, and shall be made available to the Division upon request. [15A NCAC 02T
.0108(c)]
Three copies of all monitoring data (as specified in Conditions IV.3. and IVA.) on Form NDMR for
each PPI and three copies of all operation and disposal records (as specified in Conditions IV.5. and
IV.6.) on Form NDAR-1 for every site in Attachment B shall be submitted on or before the last day of
the following month. If no activities occurred during the monitoring month, monitoring reports are still
required documenting the absence of the activity. All information shall be submitted to the following
address:
Division of Water Resources
Information Processing Unit
1617 Mail Service Center
Raleigh, North Carolina 27699-1617
[15A NCAC 02T .0105(1)]
Pursuant to § 143-215.1 C., the Permittee shall provide to its users and the Division of Water Resources
an annual report summarizing the performance of the wastewater treatment and irrigation facility and
the extent to which the facility has violated this permit, or federal or State laws, regulations, or rules
related to the protection of water quality. This report shall be prepared on either a calendar or fiscal
year basis and shall be provided no later than 60 days after the end of the calendar or fiscal year. Two
copies of the annual report provided to the Permittee's users shall be submitted to:
Division of Water Resources
Water Quality Permitting Section
1617 Mail Service Center
Raleigh, North Carolina 27699-1617
[G.S. 143-215.1 C]
9. A record shall be maintained of all residuals removed from this facility. This record shall be maintained
at the facility for a period of no less than five years, and shall be made available to the Division upon
request. At a minimum., this record shall include:
a. Name of the residuals hauler;
b. Non -Discharge permit number authorizing the residuals disposal, or a letter from a municipality
agreeing to accept the residuals;
c. Date the residuals were hauled; and
d. Volume of residuals removed.
[ 15A NCAC 02T A 108(b)(1)1
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10. A maintenance log shall be maintained at this facility. This log shall be maintained at the facility for a
period of no less than five years, and shall be made available to the Division upon request. At a
minimum, this log shall include:
a. Date of calibration of flow measurement device;
b. Visual observations of the plant and plant site; and
c. Record of preventative maintenance (e.g., changing of equipment, adjustments, testing, inspections
and cleanings, etc.).
[15A NCAC 02T .0108(b)(1)]
11. Monitoring wells shall be sampled at the frequencies and for the parameters specified in Attachment
C. All mappingwell construction forms, well abandonment forms and monitoring_ data shall refer to
the permit number and the well nomenclature as provided in Attachment C-and Figure 1. [15A NCAC
02T .0105(m)]
12. Two copies of the monitoring well sampling and analysis results shall be submitted on a Compliance
Monitoring Form (GW-59), along with attached copies of laboratory analyses, on or before the last
working day of the month following the sampling month. The Compliance Monitoring Form (GW-59)
shall include this permit number, the appropriate well identification number, and one GW-59a
certification form shall be submitted with each set of sampling results. All information shall be
submitted to the following address:
Division of Water Resources
Information Processing Unit
1617 Mail Service Center
Raleigh, North Carolina 27699-1617
[15A NCAC 02T .0105(m)]
13. An annual representative soils analysis (i.e., Standard Soil Fertility Analysis) shall be conducted on
each irrigation site listed in Attachment B. These results shall be maintained at the facility for a period
of no less than five years, and shall be made available to the Division upon request. At a minimum, the
Standard Soil Fertility Analysis shall include the following parameters:
Acidity
Exchangeable Sodium Percentage
Phosphorus
Base Saturation (by calculation)
Magnesium
Potassium
Calcium
Manganese
Sodium
Cation Exchange Capacity
Percent Humic Matter
Zinc
Copper
pH
[I 5A NCAC 02T .0108(c)]
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14. Noncompliance Notification:
The Permittee shall report by telephone to the Wilmington Regional Office, telephone number (910)
796-7215, as soon as possible, but in no case more than 24 hours, or on the next working day following
the occurrence or first knowledge of the occurrence of any of the following:
a. Treatment of wastes abnormal in quantity or characteristic, including the known passage of a
hazardous substance.
b. Any process unit failure (e.g., mechanical, electrical, etc.), due to known or unknown reasons,
rendering the facility incapable of adequate wastewater treatment.
c. Any facility failure resulting in a by-pass directly to receiving surface waters.
d. Any time self -monitoring indicates the facility has gone out of compliance with its permit
limitations.
e. Ponding in or runoff from the irrigation sites.
Any emergency requiring immediate reporting (e.g., discharges to surface waters, imminent failure of
a storage structure, etc.) outside normal business hours shall be reported to the Division's Emergency
Response personnel at telephone number [phone], [phone], or [phone]. Persons
reporting such occurrences by telephone shall also file a written report in letter form within five days
following first knowledge of the occurrence. This report shall outline the actions taken or proposed to
betaken to ensure the problem does not recur. [15A NCAC 02T .0105(1), 02T .0108(b)(1)]
V. INSPECTIONS
1. The Permittee shall provide adequate inspection and maintenance to ensure proper operation of the
wastewater treatment and irrigation facilities. [15A NCAC 02T .0108(b)]
2. The Permittee or their designee shall inspect the wastewater treatment and irrigation facilities to prevent
malfunctions, facility deterioration and operator errors resulting in discharges, which may cause the
release of wastes to the environment, a threat to human health or a public nuisance. The Permittee shall
maintain an inspection log that includes, at a minimum, the date and time of inspection, observations
made, and any maintenance, repairs, or corrective actions taken. The Permittee shall maintain this
inspection log for a period of five years from the date of the inspection, and this log shall be made
available to the Division upon request. [15A NCAC 02T .0108(b)]
3. Any duly authorized Division representative may, upon presentation of credentials, enter and inspect
any property, premises or place on or related to the wastewater treatment and irrigation facilities
permitted herein at any reasonable time for the purpose of determining compliance with this permit;
may inspect or copy any records required to be maintained under the terms and conditions of this permit,
and may collect groundwater, surface water or leachate samples. [G.S. 143-21.5.3(a)(2)]
VI. GENERAL CONDITIONS
1. Failure to comply with the conditions and limitations contained herein may subject the Permittee to an
enforcement action by the Division in accordance with North Carolina General Statutes 143-215.6A to
143-215.6C. [G.S. 143-215.6A to 143-215.6C]
2. This permit shall become voidable if the permitted facilities are not constructed in accordance with the
conditions of this permit, the Division approved plans and specifications, and other supporting
documentation. [15A NCAC 02T .0110]
3. This permit is effective only with respect to the nature and volume of. wastes described in the permit
application, Division approved plans and specifications, and other supporting documentation. No
variances to applicable rules governing the construction or operation of the permitted facilities are
granted, unless specifically requested and approved in this permit pursuant to 15A NCAC 02T .0105(n).
[G.S. 143-21.5.1]
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4. The issuance of this permit does not exempt the Permittee from complying with any and all statutes,
rules, regulations, or ordinances, which may be imposed by other jurisdictional government agencies
(e.g., local, state, and federal). Of particular concern to the Division are applicable river buffer rules in
15A NCAC 02B .0200; erosion and sedimentation control requirements in 15A NCAC Chapter 4 and
under General Permit NCGO10000; any requirements pertaining to wetlands under 15A NCAC 02B
.0200 and 02H .0500; and documentation of compliance with Article 21 Part 6 of Chapter 143 of the
General Statutes. [ 15A NCAC 02T .0105(c)(6)]
In the event the permitted facilities change ownership or the Permittee changes their name, a formal
permit modification request shall be submitted to the Division. This request shall be made on official
Division forms, and shall include appropriate property ownership documentation and other supporting
documentation as necessary. The Permittee of record shall remain fully responsible for maintaining
and operating the facilities permitted herein until a permit is issued to the new owner. [15A NCAC
02T .0104]
6. The Permittee shall retain a set of Division approved plans and specifications for the life of the faci I ities
permitted herein. [15A NCAC 02T .0108(b)(1)]
7. The Permittee shall maintain this permit until all permitted facilities herein are properly closed or
permitted under another permit issued by the appropriate permitting authority. [15A NCAC 02T
.01050)]
8. This permit is subject to revocation or unilateral modification upon 60 days' notice from the Division
Director, in whole or part for the requirements listed in 15A NCAC 02T .0110. [ 15A NCAC 02T .0110]
9. Unless the Division Director grants a variance, expansion of the permitted facilities contained herein
shall not be granted if the Permittee exemplifies any of the criteria in 15A NCAC 02T .0120(b). [ 15A
NCAC 02T .0120]
10. The Permittee shall pay the annual fee within 30 days after being billed by the Division. Failure to pay
the annual fee accordingly shall be cause for the Division to revoke this permit. [15A NCAC 02T
.0105(e)(3)]
Permit issued this the 8'h day of March 2017
NORTH CAROLINA ENVIRONMENTAL MANAGEMENT COMMISSION
S. Jay Zimmerman, P.G., Director
Division of Water Resources
By Authority of the Environmental Management Commission
Permit Number WQ0019907
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ATTACHMENT A - LIMITATIONS AND MONITORING REQUIREMENTS
PPI 001 - WWTF EFFLUENT
Permit Number: WQ0019907 Version: 3.0
EFFLUENT CHARACTERISTICS
EFFLUENT LIMITS
MONITORING REQUIREMENTS
PCs
Code
Parameter Description
p
Units of
Measure
Monthly
Average
Monthly
Geometric Mean
Daily Minimum
Daily Maximum
Measurement
Frequency
Sample
Type
00310
BOD, 5-Day (20 °C)
mg/L
_
Monthly
Grab
00940
Chloride (as Cl)
mg/L
3 x Year
Grab
31616
Coliform, Fecal MF, M-FC Broth, 44.5 °C
#/100 mL
Monthly
Grab
50050
Flow, in Conduit or thru Treatment Plant
GPD
224,673
Continuous
Recorder
00610
Nitrogen, Ammonia Total (as N)
mg/L
Monthly
Grab
00625
Nitrogen, Kjeldahl, Total (as N)
mg/L
Monthly
Grab
00620
Nitrogen, Nitrate Total (as N)
mg/L
Monthly
Grab
00600
Nitrogen, Total (as N)
mg/L
Monthly
Grab
00400
pH
su
5 x Week
Grab
00665
Phosphorus, Total (as P)
mg/L
Monthly
Grab
70300
Solids, Total Dissolved —180 °C
mg/L
3 x Year
Grab
00530
Solids, Total Suspended
mg/L
Monthly
Grab
1. 3 x Year sampling shall be conducted in March, July, and November.
WQ0019907 Version 3.0 Attachment A Page 1 of 1

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ATTACHMENT B - APPROVED LAND APPLICATION SITES AND LIMITATIONS
ONSLOW WATER & SEWER AUTHORITY - HOLLY RIDGE WWTF
Permit Number: WQ0019907 Version: 3.0
IRRIGATION AREA INFORMATION
APPLICATION LIMITATIONS
Field
Owner
County
Latitude
Longitude
8
Net
Acrea a
Dominant
Soil Series
Parameter
Hourly
Rate
Yearly
Max
Units
VIA
Town of Holly Ridge "
Onslow
34.5152401
-77.5023990
9.82
Leon
01284 -Non-Discharge Application Rate
0.12
36.92
inches
1/113
Town of Holly Ridge 1
Onslow
34,5138640
-77.50148611
9.62
Leon
01284- Non -Discharge Application Rate
0.12
36.92
inches
VIC
Town of Holly Ridge
Onslow
34.513117'
-77.5015471
8.07
Leon
01284-Non-Discharge Application Rate
0.12
36.92
inches
I/lD
Town of Holly Ridge
Onslow
34.512088'
-77.5009951
3.74
Leon
01284 - Non -Discharge Application Rate
0.12
36.92
inches
2/2A-1
Town of Holly Ridge
Onslow
34.508936'
-77.500775'
8.79
Pactolus
01284 - Non -Discharge Application Rate
0.12
36.92
inches
2/2A-2
Town of Holly Ridge'
Onslow
34.508358'
-77.5006871
12.20
Pactolus
01284 - Non -Discharge Application Rate
0.12
36.92
inches
2/2A-3
Town of Holly Ridge
Onslow
34.507327'
-77.499024'
11.66
Pactolus
01284 - Non -Discharge Application Rate
0.12
36.92
inches
2/2B-1
Town of Holly Ridge'
Onslow
34.506634'
-77.499176'
8.63
Goldsboro
01284 -Non-Discharge Application Rate
0.12
21.84
inches
2/213-2
Town of Holly Ridge "
Onslow
34.506634'
-77.499176'
5.84
Goldsboro
01284 - Non -Discharge Application Rate
0.12
21.84
inches
3/3A
Town of Holly Ridge
Onslow
34.5115790
-77.4966610
9.44
Pactolus
01284 - Non -Discharge Application Rate
0.12
36.92
inches
313B
Town of Holly Ridge
Onslow
34.5098020
-77.4966840
11.79
Pactolus
01284 - Non -Discharge Application Rate
0.12
36.92
inches
Totals
99.59
1. Onslow Water and Sewer Authority a Water Service Agreement with the Town of Holly Ridge for the use of 11 fields (Agreement attached).
WQ0019907 Version 3.0 Attachment B Page 1 of 1

THIS PAGE BLANK

ATTACHMENT C — GROUNDWATER MONITORING AND LEMTATIONS
Monitoring wells: MW-1, MW-2, MW-3 & MW-4
Permit Number: WQ0019907 Version: 3.0
GROUNDWATER CHARACTERISTICS
GROUNDWATER STANDARDS
MONITORING REQUIREMENTS
PCS Code
Parameter Description
Daily Maximum
Frequency Measurement
Sample Type
Footnotes
00940
Chloride (as Cl)
250
mg/L
3 x Year
Grab
1
31616
Coliform, Fecal MF, M-FC Broth, 44.5 °C
#/100 mL
3 x Year
Grab
1
00610
Nitrogen, Ammonia Total (as N)
1.5
mg/L
3 x Year
Grab
1
00620
Nitrogen, Nitrate Total (as N)
10
mg/L
3 x Year
Grab
1
00400
pH
6.5-8.5
su
3 x Year
Grab
1,2
00665
Phosphorus, Total (as P)
mg/L
3 x Year
Grab
1
70300
Solids, Total Dissolved - 180 °C
500
mg/L
3 x Year
Grab
1
GWVOC
Volatile Compounds (GC/MS)
Present: Yes/No
Annually
Grab
1, 4, 5
82546
Water Level, Distance from measuring point
feet
3 x Year
Calculated
1, 2, 3
I . 3 x Year monitoring shall be conducted in March, July & November; Annual monitoring shall be conducted every November.
2. The measurement of water levels shall be made prior to purging the wells. The depth to water in each well shall be measured from the surveyed point on the top of the casing. The measurement of
pH shall be made after purging and prior to sampling for the remaining parameters.
3. The measuring points (top of well casing) of all monitoring wells shall be surveyed to provide the relative elevation of the measuring point for each monitoring well. The measuring points (top of
casing) of all monitoring wells shall be surveyed relative to a common datum.
4. Volatile Organic Compounds (VOC) - In November only, analyze by one of the following methods:
a. Standard Method 6230D, PQL at 0.5 µg/L or less
b. Standard Method 621OD, PQL at 0.5 µg/L or less
c. EPA Method 8021, Low Concentration, PQL at 0.5 µg/L or less
d. EPA Method 8260, Low Concentration, PQL at 0.5 µg/L or less
e. Another method with prior approval by the Water Quality Permitting Section Chief
Any method used must meet the following qualifications:
a. A laboratory must be DWR certified to run any method used.
b. The method used must, at a minimum, include all the constituents listed in Table VIII of Standard Method 6230D.
C. The method used must provide a PQL of 0.5 µg/L or less that must be supported by laboratory proficiency studies as required by DWR. Any constituents detected above the MDL but below
the PQL of 0.5 µg/L must be qualified (estimated) and reported.
5. If any volatile organic compounds (VOC) are detected as a result of monitoring as provided in Attachment C, then the Wilmington Regional Office supervisor, telephone number [phone],
must be contacted immediately for further instructions regarding any additional follow-up analyses required.
6. Monitoring wells shall be reported consistent with the nomenclature and location information provided in Figure 2 and this attachment.
WQ0019907 Version 3.0 Attachment C Page 1 of 1

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W 0019907
SITE DETAIL MAP

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Figure 2. Holly Ridge WWTF (WQ0019907) Spray Fields and Monitoring Wells.

RE EjVED/NCQEQ/DWR
WATER SERVICE AGREEMENT JUL 1 5 2016
Non -Discharge
'emmi€ ing Unit
AGREEMENT made this ls� day of July, 2005, by and between ONSLOW WATER
AND SEWER AUTHORITY, a body politic and corporate of the State of North Carolina and
the TOWN OF HOLLY RIDGE (the "Town") a political subdivision of the State of North
Carolina;
WITNESSETH:
WHEREAS, the County of Onslow (the "County"), the City of Jacksonville
("Jacksonville"), and the 'Towns of Swansboro ("Swansboro"), Richlands, North Topsail Beach
{"North Topsail") and Holly Ridge ("Molly Ridge"), acting through their respective governing
bodies, pursuant to the provisions of Article 1, Chapter 162A of the General Statutes of North
Carolina, as amended, organized and incorporated the Onslow Water and Sewer Authority (the
"Authority") as a vehicle to assist in providing a satisfactory supply of potable water and sewer
collection/treatment for the member governments of the Authority; and
WHEREAS, the County, Jacksonville, Richlands, Swansboro, North Topsail and Holly
Ridge are the sole members of the Authority; and
WHEREAS, the Authority has entered into agreements with the United States of America
which provide that the Marine Corps Base, Camp Lejeune, shall provide specified volumes of
potable water and sewer treatment capacity to the Authority; and
WHEREAS, the Town is in need of additional potable water capacity and desires for the
Authority to make water from Camp Lejeune available to the Town's citizens; and
WHEREAS, the Town has determined that the Authority will bo better able to meet the
needs of its citizens if the Authority leases and operates the water and sewer systems of its
member governments to which it will be providing water and sewer service (provided, however,
that said determination applies only to the Town of Holly Ridge's water system at the present
tune); and
WHEREAS, the Authority is authorized. and empowered to acquire, lease, construct,
reconstruct, extend, improve, maintain, better and operate potable water and sewage
collection/treatment facilities and has determined that it will be in its best interest and in the best
interest of its member governments to lease, operate and maintain the water system of the Town;
and
WHEREAS, the Town has leased its water system to the Authority pursuant to a Capital
Lease Agreement (the "Lease") of every date with this Agreement; and
WHEREAS, in consideration of the Town signing and delivering the Lease, the Authority
desires to enter into this Agreement to provide water service to the citizens of the Town..

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
conditions herein contained, it is agreed among the parties as follows;
1. Term. This Agreement shall become effective upon its execution and shall
continue in effect until the Lease is terminated.
2. Service. The Authority agrees, when economically and technically feasible, to
meet the potable water supply, treatment and distribution needs of the citizens of the Town, who
are not provided water, by any other gover runentaI entity or public utility, subject to limitations
upon the Authority's ability to do so caused by (i) the amount of potable water supply, treatment
capacity and distribution lines available to the Authority, (ii) obligations of the Authority to
provide water service to others, (iii) the capacity of the Authority's water system and (iv)
completion of any improvements the Authority elects to make to enable it to provide water
service. Nothing herein shall obligate the Authority to provide any potable water supply if the
provision thereof will ,result in the Authority being in violation of any applicable laws or other
governmental regulations or result in a material breach of any agreements to which the Authority
is a party. The Authority shall maintain a satellite office in the Town for the purpose of bill
payment and telephone communication from customers. The Town shall if requested by the
Authority provide at actual cost an office at the town hall but not equipment (other than
telephones) and furnishings. The Authority shall pay the Town annually for the cost of such
office.
3. Planning. In order to provide for the public health and welfare, the Authority will
use reasonable efforts to develop additional potable water supply, treatment and distribution
facilities and sewer collection/treatment capacity to meet the needs of all of its customers and
will use financial planning practices, policies and procedures that are in the opinion of the
Authority reasonably sound to provide funds, through water and sewer user rates, impact fees
and related charges, and/or loans, necessary to provide the facilities to meet such needs.
4. Authorily to Provide All Water Service. So long as the Authority is capable of
meeting the water needs of the citizens of the Town pursuant to this agreement, the Town shall
not without the prior consent of the Authority acquire or produce potable water from any source
other than the Authority. The parties agree that in the event the Town breaches provisions of this
paragraph, monetary damages would not adequately compensate the Authority and in the event
of such breach, the Authority shall be entitled to equitable relief requiring that the Town comply
with the terms of this paragraph.
5. Qpgration and Maintenance. The Authority shall operate and maintain or cause
to be operated and maintained its water and sewer systems in a safe, efficient and economical
manner, making all necessary and proper repairs, replacements and renewals consistent with
good business and operating practices for comparable facilities in accordance with applicable
standards of regulatory bodies. The Authority shall cause a consulting engineer(s) to inspect its
systems at least once every thirty six months and to submit to the Authority a report identifying
any operation or maintenance or repair problems and setting forth for the ensuing thirty six
month period (a) the engineer's recommendations as to any revisions that should be made in the
methods of operation and maintenance of the systems and any repairs that must be made to
2

properly operate and maintain the systems in such period and his estimate of the cost of such
repairs and methods, (b) his estimate as to the amount of adequate reserves for extraordinary
repairs, renewals and replacements to the systems in such period, (c) his estimate as to the
staffing requirements of the Authority for such period and (d) his estimate as to any additional
insurance that may be needed to insure the Authority against loss due to casualty loss or damage
to the systems.
The Town shall be entitled at its expense to paint upon the Town's existing water
tank/tower, the words "The Town of Holly Ridge", a logo of the Town's choosing or any other
words or graphics of its choice and to install upon the tank/tower such lighting as it chooses,
whether to illuminate the Town's name and/or logo or other words or graphics or whether for
holiday or seasonal purposes, and shall be entitled to a perpetual, relegable non-exlexusive
easement and right of entry, ingress, egress and regress upon said tark/tower for the purposes of
installing, maintaining, servicing, repairing, removing and replacing such words, graphics or
lighting, provided that such activity does not unreasonably interfere with the Authority's
operation of the tank/tower as anticipated and provided herein.
6. Insurance. The Authority shall carry at all times insurance covering all properties
belonging to its water and sewer systems insuring against loss or damage from such causes as are
customarily insured against by enterprises of a similar nature.
7. Ordinances and Regulations. All water service provided to the citizens of the
Town shall be subject to and in accordance with the Authority's Rules and Regulations for
Rendering Water Service, as they may be amended from time to time. The Authority's Rules
and Regulations for Rendering Water Service shall address all aspects of water service to the
Town. except water and sewer system expansions within the Town and the Town's area of
extraterritorial jurisdiction (the " ETJ"). The Town agrees during the terra of this agreement to
enact and at all times maintain in effect an ordinance(s) governing the expansion of water and
sewer utilities within the Town's corporate limits and the ETJ (the "Town Ordinance")_ The
Authority shall only make expansions to the Authority's water and sewer lines for the purpose of
serving new customers within the Town's corporate limits and the I-T3 in accordance with the
Town Ordinance. Notwithstanding the foregoing, the Authority may make System extensions
within the Town or the ETi in accordance with the Authority's ordinances, rules and regulations
if the Town does not have its own ordinances in effect governing System expansions and
extensions within such areas.
8. Billin . The Town and the Authority shall work cooperatively and take all steps
reasonable necessary to provide that customers who received water service from the Authoirty
and who also receive sewer service, solid waste service or recycling service (or any combination
thereof from the Town receive only one bill for all of the services. The parties anticipate at this
time that the Town will provide the Authority the Town's billing information for sewer, solid
waste and recycling services and that the Authority will issue one bill to each customer for all of
said services received by that customer and remit to the Town the portion of the receipts that
represents the Town's charge for the service(s) provided by the Town.

9. Representations and Warranties. The Town and the Authority each represent to
the other:
a. That each has the full legal right, power and authority to execute this
agreement;
b. That each by official action prior to or concurrently with the date hereof
by action of its respective governing boards approve the execution and delivery of this
agreement;
c. This agreement constitutes the legal, valid and binding agreement of each
party hereto, enforceable in accordance with its terms except as enforcement hereof may
be limited by bankruptcy, insolvency, reorganization, moratorium or similar Iaws
effecting the enforcement of creditors rights generally and may be limited by general
equitable principles concerning -remedies.
d. In addition to the mutual representations set out in this paragraph, the
Authority specifically acknowledges that the future well-being and orderly growth of the
Town is largely contingent upon the availability of potable water supply and waste -water
collection and treatment capacity and that the Town is engaged at the present time in a
substantial capital improvements project to upgrade and increase it wastewater collection
and teatment capacities. The Authority agrees that it will extend its services into those
areas contiguous with the Town's corporate limit and those areas contained within the
Town's area of extraterritorial jurisdiction only in accordance with the Town's
annexation policy and that the Authority will ensure whenever economically and
technically feasible that its services are in fact extended into all areas for which the owner
has petitioned the Town for annexation.
10. Successors and AssigLis. This agreement shall be binding upon, inure to the
benefit of and be enforceable by the parties hereto and their respective successors and assigns;
provided, however, that neither party may assign their rights, liabilities and obligations
hereunder without the consent of the other party except that the Authority may assign this
agreement to a trustee without the consent of the Town in regard to Authority Bond issues or
other financings.
11. Severability. If any provision of this agreement shall be held invalid or
unenforceable by any court of competent jurisdiction, such holding shall not affect any other
provision thereof
12. Waiver. Any party's failure to insist upon the strict performance of any provision
of this agreement, or to exercise any right based upon a breach thereof, or the acceptance of any
performance during such breach, shall not constitute a waiver of any rights under this agreement.
13. CountMarts. This agreement may be executed in several counterparts, any of
which shall be regarded for all purposes as one original.
S

14. Controlling Law. This agreement shall be construed and enforced in accordance
with the laws of the State of North Carolina.
IN WITNESS WHEREOF the parties have executed this agreement the slay and year first
above written.
ONSLOW WATER AND SEWER AUTHORITY
By -
TOWN OF HOLLY RIIDGE
�d By. Q

CAPITAL LEASE AGREEMENT
THIS CAPITAL LEASE, entered into as of the 30th day of June, 2005, by
and between the TOWN OF HOLLY RIDGE, a municipal corporation of the State
of North Carolina (the "Town") and ONSLOW WATER AND SEWER
AUTHORITY, a body politic and corporate of the State of North Carolina (the
"Authority').
RECITALS:
This Capital Lease Agreement is entered into pursuant to the terms of
Agreement to Lease Utility System (the "Agreement to Lease") between the
Town and the Authority dated the 22,jday of -�z v , 2005.
AGREEMENT
The Town hereby leases to the Authority and the Authority hereby rents
from the Town, the Town's water system consisting of the real and physical
assets described on Schedule 3.6(a)(i) of the Agreement to Lease (the "Leased
Assets"). All of the Leased Assets are located in the Town. The Town also
assigns and transfers to the Authority the "Transferred Assets" described in
Article I, Section 2.1 of the Agreement to Lease.
1. Term. This lease shall commence on July 1, 2005 (the
"Commencement Date") and shall terminate June 30, 2035.
2. Option to Extend. Provided that the Authority is in compliance with
all the terms and conditions of this lease, it may extend the term of this lease for
additional successive terms of 15 years each by the giving of Notice of election to
extend, which Notice must be given no later than 2 years before the end of the
original or any extended term of this Agreement. The Authority shall be entitled
to exercise these options to extend at any time after the Commencement Date.
3. Rent. The rent for the entire term and extended term of this lease
shall be payable on or in advance of the Commencement Date and shall consist
of the payment of the Town's bond and other indebtedness as required by Article
II of the Agreement to Lease.
4. Possession. The Authority shall have exclusive possession of the
Leased Assets which shall be delivered to the Authority on the Commencement
Date; provided, however, that the lease of the real property upon which the
Town's existing water towerltank is located shall be non-exclusive and Holly
Ridge retains the right to use said real property in any reasonable manner not
inconsistent with the lease contemplated herein, including without limitation, the
right to negotiate for and place antennas on the water tower in accordance with
current standards so long as appropriate Authority personnel approves the same
for the sole purpose of ensuring safety and structural integrity of the tower. All

proceeds from antenna rentals shall belong to the Town. The Town shall.also be
entitled to maintain its name in print on the face of the water tank.
5. Alterations and Abandonment. The Authority may make such
alterations to the Leased Assets as the Authority in its sole discretion deems
appropriate. The right to alter the Leased Assets includes but is not limited to the
right to connect the Leased Assets with and make them a part of other utility
facilities leased or owned by the Authority (the Leased Assets together with the
other utility facilities owned or leased by the Authority are referred to herein as
the "System"). The Authority may also abandon and dispose of any of the
Leased Assets which become obsolete or which the Authority otherwise deems
are not necessary for the proper operation and maintenance of the System;
provided, however, that before disposing of any Leased Assets which the
Authority has abandoned it shall first give Notice of such intent to the Town. If
the Town sloes not take possession of such abandoned property within 45 days
of such Notice, the Authority shall be free to dispose of the property without
liability to the Town. Any portion of the Leased Assets comprised of real estate
or easements encumbering real estate not put to public use by the Authority for
a continuous period of eighteen months shall be considered abandoned and shall
be returned to the Town.
5. System Operation and Maintenance. The Authority shall at its sole
cost and expense operate and maintain or cause to be operated and maintained,
the System in a safe, efficient and economical manner making all necessary and
proper repairs, replacements and renewals consistent with good business and
operating practices for comparable facilities and in accordance with applicable
standards of regulatory bodies.
7. Extensions and Additions. The Authority may at its sole cost and
expense make such enlargements and extensions to the System as it deerrns
appropriate and such extensions and additions may be connected to the Leased
Assets. All such extensions and additions shall be the sole property of the
Authority.
8. Use. The Authority shall establish and enforce rules and
regulations governing the use and operation of the System. The Authority shall
not permit the use of the System for any € nlawful purpose.
g. User- Rates/Revenues. The Authority shall for each fiscal year
establish utility user rates which are at least sufficient to pay its current expenses
for operation and maintenance and debt service on its debt obligations. The
Authority shall not incur current expenses in any fiscal year in excess of the
reasonable and necessary amount thereof. All revenues from the System shall
be the sale and exclusive property of the Authority and the Town shall have no
claim to such revenues by virtue of the Town owning the Leased Assets.

10. Annual Review of the System/Other Information, and Reports. (a)
The Authority shall cause its consulting engineer to make a review of the System
at least once in each Fiscal Year and, on or before the 60t' day next preceding
the first day of each Fiscal Year, to submit to the Authority a report setting forth
(a) its findings whether the System has been maintained in good repair, working
order and condition and (b) its recommendations as to:
(i) the proper maintenance, repair and operation of the System
during the ensuing Fiscal Year and an estimate of the amount of money
necessary for such purposes, and
(0) the improvements, renewals and replacements that should
be made during the ensuing Fiscal Year and an estimate of the amount of money
necessary for such purposes.
Promptly after the receipt of such reports by the Authority, copies thereof
shall be mailed by the Authority to the Town.
If any such report of the consulting engineer indicates that the System has
not been maintained in good repair, working order and condition, the Authority
promptly shall restore the System to good repair, working order and condition
with all expedition practicable.
(b) The Authority shall within 14 days of receipt provide the Town
with a copy of (i) its audited financial statements for each fiscal year, (R) the
minutes of its Board meetings, (iii) all notices of violations received from any
state or federal agency and (iv) all security advisories from the Department of
Homeland Security or other cognizant state or federal agency.
(c) The Executive Director of the Authority shall within 30 days
after receipt of the Authority's annual audit provide a written report to the Town
on the financial condition of the Authority. The Executive Director shall also
provide such other written reports as the Town may reasonably request from time
to time so long as obtaining the information for the report does not require the
hiring of consultants or the expenditure of funds by the Authority other than the
normal salary of its staff and related costs.
11. Insurance. From the Commencement Date forward, the Authority
shall carry at all times insurance with a responsible insurance company or
companies, authorized and qualified under the laws of the State to assume the
risk thereof, covering such properties belonging to the System as are customarily
insured, against loss or damage from such causes as are customarily insured
against, by enterprises of a similar nature and also comprehensive general
liability insurance on the System for bodily injury and property damage, provided
that the same shall meet the following minimum requirements:

(a) fire (with Uniform Standard Extended Coverage
Endorsements or equivalent coverage obtainable through federal or State
programs) and vandalism and malicious mischief insurance, as may be approved
for issuance in the state, including insurance against loss or damage from
lightning, windstorm, hail, hurricanes, tornadoes, floods, explosion, riot, riot
attending a strike, civil commotion, aircraft, vehicles and smoke, at all times in
amounts equal to the greater of (1 ) the principal amount of all bonds of the
Authority at any time outstanding and (2) the full replacement cost of the
properties comprising the System, which amount shall be sufficient to ensue that
the Authority could not become a co-insurer under the terms and conditions of
the applicable policy or policies. The replacement cost of the properties
comprising the System shall be determined at least once every five years or
more often upon the request of the insurer by an appraisal by qualified
appraisers or other persons or entities selected by the Authority. The Authority
shall provide a copy of the appraisal to the Town within 30 days after the receipt
thereof.
(b) comprehensive general liability insurance with limits of not
less than $2,000,000 combined single limit for bodily injury and property damage
occurrence;
(c) workers' compensation insurance in such amounts as are
required by laws.
If upon mutual consent the Authority and the Town determine that the
amount of insurance coverage required by this paragraph is not available on
reasonable terms and conditions, the insurance coverage required by this
paragraph may be modified in accordance with such determination, and the
coverage as modified shall constitute the minimum requirements of this
agreement.
All insurance coverage shall be maintained through policies that (i) are
issued by a financially responsible insurer or insurers qualified to write the
respective insurance in the State and of recognized standing, (H) are in such form
and contain such provisions (including, without limitation, the loss payable
clause, the waiver of subrogation clause, clauses relieving the insurer of liability
to the extent of minor claims, and the designation of the named insured parties)
as are generally considered custornary previsions for the type of insurance
involved, and (iii) prohibit cancellation or substantial modification by the insurer
without at least 60 clays` prior written notice to the Authority.
The Authority shall have no liability for casualty losses to or of the System
except for its obligation to maintain the insurance required by this paragraph and
to apply insurance proceeds as required by this paragraph.

13. Compliance with Applicable Law. The Authority shall comply or
cause there to be compliance with all applicable laws, orders, rules, regulations
and requirements of all municipal or other governmental authorities relating to the
use, operation and occupancy of the System. Nothing contained in this
paragraph shall prevent the Authority from contesting in good faith the
applicability or validity of any law, ordinance, order, rule, regulation or
requirement so long as the authority shall have received an opinion of Authority
counsel to the effect that such failure to comply during the period of such contest
will not materially impair the use or the revenue=producing capacity of the
System.
14. Consultants. The Authority agrees to employ such accountants,
consulting engineers and attorneys and to at give them such access to the
System as necessary to perform the duties imposed on them by this Lease.
15. Contracts, Leases, and Other Agreements; Water Supply
Agreements. The Authority may contract or agree for the performance by others
of operations or services in connection with the System or any part thereof for
any lawful purpose; provided, however, that the Authority shall remain fully
obligated and responsible under this lease to the same extent as if such lease or
contract had not been executed.
16. Payment of Charges and discharge of Liens. The Authority shall
pay or cause to be discharged, or shall make adequate provision to satisfy and
discharge, within 60 days after the same shall become due and payable all lawful
costs, expenses, liabilities and charges relating to the maintenance, repair,
replacement, improvement and operation of the System and all lawful claims and
demands for labor, materials, supplies or other objects that might by law become
a lien upon the System or System revenues if unpaid, provided that nothing
contained in this paragraph shall require the Authority to pay or cause to be
discharged, or make provision for the satisfaction and discharge of any cost,
expense, liability, or charge so long as the validity thereof shall be contested in
good faith and by appropriate legal proceedings in the same manner as is
hereinafter provided for the contest of liens and encumbrances.
If any lien not specifically permitted hereby is filed or asserted against the
System or System revenues or any part of the foregoing by reason of labor,
materials, supplies or other items supplied or claimed to have been supplied on
or to the System at the request or with the permission of the Authority or of
anyone claiming to act for the Authority, then within 30 days after it receives
notice of the filing or the assertion thereof, the Authority shall cause the same to
be discharged of record or effectively prevent the enforcement or foreclosure
thereof against the System or System revenues, or any part of the foregoing, by
contest, payment, deposit, bond, order of court or otherwise. Nothing in this
Section shall require the Authority to satisfy or discharge any such lien,
encumbrance, charge, claim or demand so long as the validity thereof shall be

contested in good faith and by appropriate legal proceedings, and the Authority
shall have received an opinion of Authority Counsel to the effect that such
contest does not jeopardize the interests of the authority, in the System or
System revenues or any part of the foregoing; provided that prior to such contest
the Authority shall have prevented the foreclosure or enforcement of any lien,
claim, encumbrance, charge or demand against the Authority by payment or
order of court, or by depositing with an escrow agent, an amount sufficient to
satisfy or discharge such lien, claim, encumbrance, charge or demand, or by
obtaining a surety bond in an amount sufficient to satisfy the same.
17. Easements. To the extent permitted by law and for a public
purpose, the Authority may lawfully grant or release, as the case may be, with or
without consideration, easements, rights of way, licenses or other rights over,
upon or beneath the surface of the land constituting a part of the System,
provided that the efficient operation of the System shall not be thereby impaired.
18, Eminent Domain. (a) If any public authority or entity, in the
exercise of its powers of eminent domain, takes or damages the System, or any
material part thereof, the Authority shall take, or cause to be taken, prompt and
appropriate measures to protect and enforce its rights and interests in connection
with any condemnation proceedings, and the Authority shall cooperate with the
Town in the protection of their mutual rights and interests. Prompt written notice
of any taking or damaging of any material part of the System or of any official
notice of any proceeding thereof of any public instrumentality, body, agency or
officer shall be given to the Town and to the other interested party by the party
first informed thereof.
(b) Immediately after any such taking or damaging of the
System, the Authority shall either replace, repair, rebuild or restore the System or
cause the: net proceeds of any award or compensation resulting from any such
taking or damaging (being the total proceeds therefrom less all reasonable and
necessary legal and other costs and expenses incurred by the Authority in
connection with such taking or damaging) to be applied to the redemption of
bonds, or if no bonds are outstanding, to be deposited to the Authority's general
fund.
19. Event of Default. Each of the following events is hereby declared
an "Event of Default":
(a) payment of the interest on any bonds of the Authority shall
not be made when the same shall become due and payable;
(b) payment of the principal of, or the redemption premiurn, if
any, on any bands of the Authority shall not be made when due and payable,
whether at maturity, by proceedings for redemption, or pursuant to a sinking fund
requirement or otherwise;

(c) failure of the Authority to perform, observe or comply with
any of the other covenants, agreements, conditions or provisions in this lease
and the continuance thereof for a period of 30 days after receipt by the Authority
of a Notice from the Town specifying such default and requesting that it be
corrected; provided, however, if prior to the expiration of such 30-day period the
Authority institutes action reasonably designed to cure such default, no "Event of
Default" shall be deemed to have occurred upon the expiration of such 30-day
period for so long as the Authority pursues such curative action with reasonable
diligence and provided that such curative action can be completed within a
reasonable time;
(d) The discontinuance of the operation and maintenance of the
System, without cause, for a continuous period of 5 days after receipt by the
Authority of a written notice from the Town specifying such default and
requesting that it be corrected;
(e) an order or decree shall be entered, with the consent or
acquiescence of the Authority, appointing a receiver or receivers of the Authority
or of the Authority's revenues, or if such order or decree, having been entered
without the consent or acquiescence of the authority, shall not be vacated or
discharged or stayed on appeal within sixty (60) days after the entry thereof;
(f) any proceeding shall be instituted, with the consent or
acquiescence of the Authority, for the purpose of effecting a composition
between the Authority and its creditors orfor the purpose of adjusting the claims
of such creditors, pursuant to any federal or state statute now or hereafter
enacted; or
(g) any court of competent jurisdiction shall assume custody or
control of the Authority or of the whole or any substantial part of its property or
the System, under the provisions of any other law for the relief or aid of debtors,
and such custody or control shall not be terminated within sixty (60) days from
the date of assumption of such custody or control.
20. Remedies. Upon the occurrence of any Event of Default, the Town
may, upon notice to the Authority, terminate this Lease and upon such
termination, the Authority shall deliver the Leased Assets to the Town "as is";
provided, however, that before the termination of this Lease shall become
effective:, (A) the Authority, the Town and any other units of government to which
or to whose citizens the Authority provides utility service shall have entered into
an agreement(s) addressing (i) the disposition of the Authority's debt and non -
tangible assets, (ii) the continued operation by the Authority of the remainder of
its System or the disposition of the remainder of the System if not to be operated
and maintained by the Authority, and (iii) the method of joint

ownership/operation and maintenance of those portions of the Leased Assets
(and the remainder of the System if not to be operated and maintained by the
Authority) which provide common service to more than one member government
of the Authority or its citizens, and (B) the agreement(s) required by this
paragraph must be approved by the Trustee under the General Trust Indenture
of the Authority dated as of dune 15, 2004.
21. No Transfer or Encumbrance by the Town. The Town shall not
voluntarily transfer, convey or encumber or suffer the involuntary transfer,
conveyance or encumbrance of the Leased Assets. 'The Authority shall be
entitled to take such legal action in the name of the Town as it deems appropriate
to protect the Leased Assets from such transfer, conveyance or encumbrance.
22. Utilities. The Authority shall provide all electricity and other utilities
needed for the operation of the Leased Assets [Joint Use Facilities].
23. Pledge of Leased Assets. The Authority may pledge and encumber
the System (including the Leased Assets) and the revenues thereof to secure
bond and other indebtedness of the Authority. The Authority may also pledge
and mortgage its interest in this Lease to secure such indebtedness. All such
pledges and encumbrances shall be superior to this Lease and to all rights and
interest of the Town herein; provided, however, that the bond indenture or other
documents evidencing and securing such indebtedness contain a provision to the
effect that upon the occurrence of any event of default under and bond, note,
indenture or other security or related loan/bond document, the trustee or the
holder of such indebtedness, as the case may be, shall provide the Town with
written notice of such default and the Town shall have the right to cure such
event of default within the cure period granted to the. Authority in such indenture
or other document.
24. Incor oration by Reference. The terms of the Agreement to Lease
are incorporated herein by reference and made a part hereof.
25. Notices. Ali notices ("Notice") or other communications which are
required or permitted hereunder shall be in writing and sufficient if (a) delivered
personally or (b) sent by registered or certified mail, postage prepaid, or (c) seat
by overnight courier with a nationally recognized courier, or (d) via facsimile
confirmed i€- writing in any of the foregoing manners, as follows;
If to the Town:
with copies to:

If to the Authority: PO Box 7227
Jacksonville, NC 28540
With a copy to: Hogue, Hill, Jones, Nash & Lynch, L.L.P.
101 South Third Street
P. O. Drawer 2178 (28402)
Wilmington, NC 28401
Attention: William O. J. Lynch
Any party may change its address for purposes of Notice by giving notice in
accordance with the provisions of this Section. Any Notice will be deemed to be
given when received, if personally delivered or sent by telecopy, and, if mailed,
five days after deposit in the United States mail, properly addressed, with proper
postage affixed.
26. No Waiver. No failure by either party to insist upon the strict
performance of any provision of this Lease or to exercise any right or remedy
consequent upon a breach thereof, and no acceptance of full or partial rent or
other performance by either party during the continuance of any such breach
shall constitute a waiver of any such breach of such provision.
27. Further Assurances. The Town shall cooperate with the Authority
and the Authority's lenders to make such modifications to this Lease as may be
required to facilitate financing by the Authority to the extent such requested
modifications do not increase the costs to the Town and are otherwise consistent
with the purpose and intent of this Lease.
28. Disputes. Any disputes involving the operation, effect, extension,
or termination of this Agreement shall be submitted to mediation as a explicit
condition precedent to litigation.
29. Quiet Enjoyment. So long as the Authority has not committed an
Event of Default, it shall have the quiet and peaceful enjoyment of the Leased
Assets, free from any interference whatsoever from the Town.
30. Holding Over. In the event the Authority holds over after the
expiration of the original or the extended term of this Lease, this lease shall
become a lease from year to year.
31. Successors. The terms of this Lease are binding on the
successors and assigns of the Town and the Authority.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURE PAGE TO CAPITAL LEASE AGREEMENT BETWEEN
®NWASA AND HOLLY RIDGE]
IN WITLESS WHEREOF, the parties hereto have caused this Agreement
to be daily executed as of the day and year first above written,
TOWN:
TOWN OF HOLLYRIDGE
- r
AUTHORITY.
ONSLOW WATER AND SEWER AUTHORITY
Its:
Title:_ �VAo:,e mo -
STATE OF NORTH CAROLINA
COUNTY OF _DAS_I a c3
I, / P" naf �i n , a Notary Public of the County and State aforesaid,
certify that -- me personally came before me this tia7a and
acknowledged that _he is -Mayor of the Town of Holly Ridge, a municipal corporation,
and that and that hefshe, as Mayor, Being authorized to do so, executed the foregoing
on behalf of said
,Town of Holly Ridge. WITNESS my hand and official stamp or seal the
Y r fir NNrlilfrl., r4��Y W y �V ®-J
r„ �j[CIaR �Ify-J '
rtif l•Nr,r4 { .
(SEANi a
),4e- Notary Public .
810

1, k�e 6, r- , .��a Notary Public of the county and state aforesaid, certify
that e-� personally came before me this day and
acknowledged that he is the Chairman of Onslow Water and Sewer Authority, a
body corporate and politic, and that he, as Chairman, being authorized to do so,
executed the foregoing on behalf of said Onslow Water and Sewer Authority. WITNESS
my hand and seal, this the clay of , 24cy;:-
My commission expires: J$ b
(SEAL_) Notary Public