NC0025453_Permit Modification_20061005

NPDES DOCUMENT SCANNING COVER SHEET
NPDES Permit:
NCO025453
Clayton WWTP
Document Type:
Permit Issuance
Wasteload Allocation
Authorization to Construct (AtC)
Permit Modification
Complete File - Historical
Engineering Alternatives (EAA)
Plan of Action
Instream Assessment (67b)
Speculative Limits
Environmental Assessment (EA)
Document Date:
October 5, 2006
This 3ocument is printed on reuse paper - iaaiore any
coaxtezat on the reYerse aide

Michael F. Easley, Governor
State of North Carolina
William G. Ross, Jr., Secretary
Department of Environment and Natural Resources
Alan W. Klimek, P.E., Director
Division of Water Quality
October 5, 2006
Mr. Steve Biggs, Manager
Town of Clayton
P.O. Box 879
Clayton, North Carolina 27520
Subject: NPDES Permit Modification
NPDES Permit NCOO25453
Clayton - Little Creek WRF
Johnston County
Dear Mr. Biggs:
In accordance with Town of Clayton's request, the Division is forwarding herewith the modified
NPDES permit for the Little Creek WRF. This permit modification is issued pursuant to the
requirements of North Carolina General Statute 143-215.1 and the Memorandum of Agreement
between North Carolina and the U.S. Environmental Protection Agency dated May 9, 1994.
The Division received no comment on the September 8 revisions to the draft permit; thus, we
are issuing the permit as revised. Please substitute the two (2) enclosed pages for the
corresponding pages in your existing permit. As already noted, the Neuse River Foundation and
Riverkeepers withdrew their request for public hearing based on clarification of the Town's
intentions for the newly acquired nitrogen allocation.
If any parts, measurement frequencies, or sampling requirements contained in this permit are
unacceptable to you, you have the right to an adjudicatory hearing upon written request within
thirty (30) days following receipt of this letter. This request must 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, 6714 Mail Service Center, Raleigh, North Carolina 27699-
6714. Unless such a demand is made, this permit shall be final and binding.
Please take notice that this permit is not transferable except after notice to the Division of
Water Quality. The Division may require modification or revocation and reissuance of the
permit. This permit does not affect the legal requirements to obtain other permits which may
be required by the Division of Water Quality, the Division of Land Resources, the Coastal Area
Management Act, or any other federal or local governmental permit.
If you have any questions concerning the final permit, please contact Mike Templeton at (919)
733-5083, extension 541, or at [e-mail]
Sincerely
f,/
r : Alan W. HIimek, P.E.
Director
Enclosure: Permit Modification, NC0025453
Copies: Larry Baldwin, Neuse Riverkeeper - 220 S. Front Street, New Bern, NC 28560
Chief, NPDES and Biosolids Permits Section, Region IV, EPA
Raleigh Regional Office, Surface Water Protection
Central Files
NPDES Files
Division of Water Quality, Point Source Branch Telephone [phone]
1617 Mail Service Center, Raleigh, North Carolina 27699-1617 FAX [phone] o��hCaro ina
512 N. Salisbury Street, Raleigh, North Carolina 27604 On the Internet at http://h2o.enr.sta—.nc.us/ r/VQIT[CQ��(�
An Equal Opportunity/Affirmative Action Employer

Permit No. NCO025453
STATE OF NORTH CAROLINA
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES
DIVISION OF WATER QUALITY
PERMIT
TO DISCHARGE WASTEWATER UNDER THE
NATIONAL POLLUTANT DISCHARGE ELIMINATION SYSTEM
In compliance with the provisions of North Carolina General Statute 143-215.1, other lawful standards
and regulations promulgated and adopted by the North Carolina Water Quality Commission, and the
Federal Water Pollution Control Act, as amended,
Town of Clayton
Little Creek Water Reclamation Facility
is hereby authorized to discharge wastewater from a facility located at
Little Creek Water Reclamation Facility
On Durham Street Extension
Clayton
Johnston County
to receiving waters designated as the Neuse River in the Neuse River Basin
in accordance with the discharge limitations, monitoring requirements, and other conditions set forth
in Parts I, II, III, and IV hereof.
This permit shall become effective......................................................................... November 1, 2006
This permit and the authorization to discharge shall expire at midnight on ............... March 31, 2008.
Signed this day ................October 5, 2006
Alan W. Klimek, P.E., Diroctor
Division of Water Quality
By the Authority of the Environmental Management Commission
Issued March 11, 2003 Clairton WWTP
Modified Eff. November 1, 2006 NPDES No. NC0025453

A. (8.) TOTAL NITROGEN ALLOCATIONS
a. The following table lists the Total Nitrogen (TN) allocations assigned to, acquired by, or transferred
to the Permittee in accordance with the Neuse River nutrient management rule (T15A NCAC 02B
.0234) and the status of each as of permit issuance. For compliance purposes, this table does not
supercede any TN limit(s) established elsewhere in this permit or in the NPDES permit of a
compliance association of which the Permittee is a Co-Permittee Member.
ALLOCATION
ALLOCATION AMOUNT ")
TYPE
SOURCE
DATE
V, STATUS
Estuary (Iblyr)
Discharge Qblyr)
Base
Assigned by Rule
1217/97;
10,700
21,400
Active
(T15A NCAC 02B .0234)
411103
Supplemental
Purchased from
715106
3,668
7,336
In Reserve
South Granville WSA
(Bay River MSD base)
TOTAL
14,368
28,736
(Mixed)
Footnote:
(1) Transport Factor = 50%
b. Any addition, deletion, or modification of the listed allocations (other than typographical errors) or
any change in status of any of the listed allocations shall be considered a major modification of
this permit and shall be subject to the public review process afforded such modifications under
state and federal rules.
Issued March 11, 2003 Town of Clayton
Page Modified Eff. November 1, 2006 NPDES No. NCO025453

N f Da
FINAL
DENR/DWQ
AMENDED FACT SHEET FOR NPDES PERMIT DEVELOPMENT
NPDES No. NCO025453, Clayton/ Little Creek WRF
Facility Information
Applicant Facility Name:
Town of Clayton Little Creek Water Reclamation Facility
Applicant Address:
P.O. Box 879, Clayton, NC 27520
Facility Address:
Durham Street Extension
Permitted Flow
1.9 MGD ansion request to 2.5 MGD
Type of Waste:
- 22% Ind., -78% Domestic at permitted flow
Facility/ Permit Status:
Renewal
County:
Johnston
Miscellaneous
Receiving Stream:
Neuse River
Regional Office:
RRO
Stream Classification:
WS-IV NSW CA
SI: 27-41.3
Quad
E25NW
Clayton
303 d Listed?:
Yes
Permit Writer:
Mike Templeton
Subbasin:
030402
Date:
October 3, 2006
Drainage Area mil :
1150
AAAW
Summer 7Q 10 cfs
186 (regulated)
Winter 7Q10 (cfs):
Average Flow(cfs):
IWC %:
1.6
Primary SIC Code:
4952
ACTION
The Division of Water Quality has made a tentative determination to modify the Little Creek
WRF permit. The revised modification differs from the July 2006 draft permit in that it does not
increase the Town's Total Nitrogen discharge limit to reflect its purchase of allocation from the
South Granville Water and Sewer Authority. Instead, it adds a Special Condition that identifies
the Town's allocations and notes that the new allocation is being held in reserve for future use.
SUMMARY OF FACILITY AND WASTELOAD ALLOCATION
The Neuse River Basin Nutrient Management Strategy rule for Wastewater Discharges (T15A
NCAC 02B .0234) provides for the transfer of nitrogen allocation among permitted dischargers
in the basin. On October 31, 2003, the NC Department of Health and Human Services (DHHS)
purchased 6,113 lb/yr of estuary Total Nitrogen (TN) allocation from the Bay River Metropolitan
Sewer District for its Town of Bunter W WTP. The DHHS has since entered into an agreement
with the South Granville Sewer and Water Authority (SGWSA), transferring operation of the
Butner plant and control of its TN allocation to SGWSA. The Authority elected to sell a portion
of the allocation to finance capital improvements at the plant. In April 2006, it offered 3,668
lb/yr of its allocation to the highest bidder among the other members of the Neuse River
Compliance Association. The Town of Clayton was the highest bidder and was awarded the
sale.
PERMIT ACTION
The current discharge TN allocation (and discharge limit) for the Town's 2.5 MGD permitted
flow is 21,400 lb/yr. The Town's original request was to increase its TN limit to 28,736 lb/yr
(21,400 + (3,668/50% transport)). The Division sent the draft permit to public notice with that
Fact Sheet Amendment
NPDES Permit Modification - Town of Clayton, Little Creek WRF, NCO025453
Page 1

change. It extended the comment period by two weeks when the Neuse Riverkeepers indicated
they had not received a copy of the permit and were not aware of the proposal.
During the initial public comment period, the Town clarified that it intends to hold the
additional allocation in reserve for future flows, that is, permitted flows beyond 2.5 MGD, and
so does not need the higher nitrogen limit at this time. It is confident it will meet its existing
limit until flow increases require a plant expansion. Based on this clarification, the Neuse
River Foundation and Riverkeepers withdrew their request for a public hearing on the permit.
The Division revised the draft permit to restore the 21,400 lb/yr nitrogen limit and instead
added a new Special Condition listing the Town's allocations and the status of each (active or
reserved). The new condition notes that, in order to "activate" the reserve allocation and
increase its limit, the Town must seek and obtain approval through permit modification, in
which case the proposed action must undergo the usual public review process.
The Division distributed the revised draft permit to all parties that expressed an interest in the
original draft. We received no comments in the two -week comment period.
Note: The revised draft permit also includes a technical correction on its cover page, changing
the previous reference to the Water Quality Commission to the Environmental Management
Commission.
PERMIT ISSUANCE
Permit Issued: October 5, 2006
Permit Effective: November 1, 2006
Permit Expires: March 31, 2008 (no change)
- end gffact sheet -
Fact Sheet Amendment
NPDES Permit Modification - Town of Clayton, Little Creek WRF, NC0025453
Page 2

LAw OFFICES OF
HOPPER, HICKS & WRENN, LLP
P.O. BOX 247, 111 GILLIAM STREET
WILUAM L HOPPER OXFORD, NORTH CAROLINA 27565
N. KYLE HICKS
JAMES C. WRENN, JR.
April 17, 2006
VIA U.S. MAIL and EMAIL
James Warren
Town of Clayton
PO Box 879
Clayton, NC 27520
Re: Proposed Sale of TN Allocation
Dear Mr. Warren:
Attachment
Page 1 of 2
TELEPHONE [phone]
FACSIMILE 919-693-9938
Effective January 1, 2006, the South Granville Water and Sewer Authority ("SGWASA") took
over operations of the Butner Utilities pursuant to a memorandum of .understanding ("MOU")
with the North Carolina Department of Health and Human Services ("DHHS"). A provision
in that MOU gives SGWASA certain rights to nutrient credits DHHS purchased. SGWASA is
interested in selling a portion of those nutrient credits.
DHHS purchased a total of 6,113 lbs/year of total nitrogen allocation at the estuary.
SGWASA anticipates selling up to sixty percent of this allocation or approximately 3,668
lbs/year at the estuary.
Following discussion at the last Neuse River Compliance Association ("NRCA") meeting, it is
clear to SGWASA that multiple parties are interested in purchasing some or all of the
allocation that SGWASA anticipates making available. SGWASA wishes to make the
allocation available to other members using a fair mechanism for the sell that hopefully will
avoid appearances of favoritism and will minimize dissent within the group. As a result,
SGWASA is inviting all members of the NRCA interested in purchasing some or all of the
nutrient credits to submit sealed bids for the credits on or before May 31, 2006 to Cindy Finan
at the address shown below. Mrs. Finan will not open the bids, but will transmit the same to
SGWASA. The bids will be opened at 8:00 a.m. on June 1, 2006. The reserve on the bids
will be $397.20 per pound at the estuary. A bid sheet is enclosed for your convenience.
Please state the proposed terms of payment on the bid sheet. Preference will be given to bids
for the entire amount of allocation that SGWASA wishes to sell (3,668 lbs/year at the estuary)

IF
Attachment A
Page 2of2
Letter to James Warren
April 17, 2006
Page 2
and bids that propose paying the purchase price in full at closing. The closing date must be on
or before June 15, 2006 unless other mutually agreeable arrangements are negotiated.
SGWASA's intent is to maximize its economic return, but to do so in a manner fair and open
to all interested members.
SGWASA, at this time, makes no warranties or representations of any kind concerning the
nutrient credits including warranty of title, warranty of fitness for a particular purpose, or
warranty of merchantability. SGWASA's offer to sell, and any bidder's offer to purchase, will
be subject to the execution of legal documents satisfactory in form and content to the attorneys
representing the buyer and the seller. The purchaser will, of course, be given the opportunity
to conduct necessary due diligence and to satisfy itself as to the state of title to the nutrient
credits offered before the purchase is finalized. This letter is a non -binding letter of intent
indicating the manner in which SGWASA intends to conduct this sale and is not intended to
bind the seller or any prospective purchaser in any way.
Bids should be submitted to:
Cindy Finan
Executive Director
Neuse River Compliance Association
PO Box 1562
Apex, NC 27502-3562
Please contact me if you have any questions.
Sincerely
James C. Wrenn, Jr.
Legal Counsel to SGWASA
{AOO41288.DOC}

4
Jody L. McLeod
MAYOR
Bruce Thompson
TOWN ATTORNEY
Steve Biggs
TOWN MANAGER Puma" e0owu"14,
May 30, 2006
Ms. Cindy Finan
Executive Director
Neuse River Compliance Association
P.O. Box 1562
Apex, North Carolina 27502-3562
Re: Sale of TN Allocation, SGWASA
Dear Ms. Finan,
Attachment B
Page--Laf 3
COUNCIL MEMBERS
Bob Satterfield
Alexander R. Atchison
Alex Harding
Michael Grannis
104 Robert Ahlert
Actiue 47* a.
MAYOR PRO TEM
Please find attached herewith a bid for purchase of total nitrogen allocation as specified in the letter
dated April 17, 2006 from Mr. James C. Wrenn, Jr., Legal Counsel to South Granville Water and
Sewer Authority, (SGWASA).
This bid is submitted based on the terms specified in the attached bid sheet and certain other
conditions and contingencies, as noted herein.
Purchase of the allocation shall require execution of a contract for sale between SGWASA (Seller)
and the Town of Clayton (Purchaser). The contract for sale must. include acknowledgement by the
Seller that they own the allocation; that it is available for sale/transfer, and the Seller conveys it to
the Purchaser in the amount and based on the terms specified on the bid form.
The date proposed for closing, per the April 17, 2006 letter is June 15, 2006. The preferred closing
date, based on the regular meeting cycle for the Town Council for the Town of Clayton would be on
or after June 20, 2006. If this closing date is not acceptable, please indicate immediately following
bid opening so that arrangements can be made for a Special Called Meeting.
The Town of Clayton bid is contingent upon financing approval by the North Carolina Local
Government Commission on June 6, 2006. At a point prior to closing the Town of Clayton will
seek and must receive an acknowledgement from the North Carolina Department of Environment
and Natural Resources (NCDENR) or its designee that its NPDES permit is eligible for
revision/amendment, upon completion of the necessary amendment process, consistent with
purchase of the TN allocation by Town of Clayton from SGWASA.
P.O. Box 879 • Clayton, North Carolina 27528.Office [phone] - Fax [phone]

i
t• �
Ms. Cindy Finan
May 30, 2006
Page Two
Attachment B
Page 2 of 3
On behalf of the Town of Clayton, thank you for considering our bid and facilitating this purchase
process.
Sincerely,
Steve Biggs
Town Manager
Town of Clayton

i"
Name of bidder:
Contact person for bidder:
Telephone number of bidder:
Address of bidder:
BID SHEET
Town of Cla on
Steve Bi s
[phone]
111 E. Second Street
PO Box 879
'Clayton, NC 27528
Attachment B
Page 3 of 3'
Pounds/ year at the estuary desired: 3, 668
Price per pound offered: $490.73
Proposed payment terms: Payment in full, at closing
Other comments: See the attached letter for details on conditions attached
to this bid.
(A0041314.DOC)

JoE�rFs,
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
<m rW REGION 4
i e ATLANTA FEDERAL CENTER
61 FORSYTH STREET
�H'14 PRO, ATLANTA, GEORGIA 30303-8960
1 � 10717
Ms. Mike Templeton
North Carolina Department of Environment and
Natural Resources
Division of Water Quality
NPDES Unit
1617 Mail Service Center
Raleigh, NC 27699-1617
1: : - -_.l►�ii'i►1775I.Y' --,Z�[fuT6ilKi[�iLdll
Clayton — Little Creek WRF - NPDES No. NCO025453
Dear Mr. Templeton:
In accordance with the EPA/NCDENR MOA, we have completed review of the revised
draft permit modification referenced above that was received by this office on September 8, 2006
and have no comments. We request that we be afforded an additional review opportunity only if
significant changes are made to the permit prior to modification, or if significant comments
objecting to the revised draft permit modification are received. Otherwise, please send us one
copy of the final permit when modified.
If you have any questions, please call me at [phone].
Sincerely,
v �1 ;Marshall Hyatt, Environmental Scientist
'nS I U Permits, Grants, and Technical Assistance Branch
l SEP 1 20�6 l'J Water Management Division
I
1 WATER DUALITY
DEtiR •c ' PF ri _'�
PD1Ni ,UUR.. _ -_--
Internet Address (URL) • http://www.epa.gov
RecycledlRecyclable • Punted with Vegetable 03 Based Inks on Recycled Paper (Minimum 30 % Postconsumer)

Clayton Public Hearing
c�►�,�rs J ��na��s
ISr 'DRAT'
Subject: Clayton Public Hearing
From: "Larry Baldwin" <[e-mail]>
Date: Thu, 24 Aug 2006 17:11:15 -0400
To: "Mike Templeton" <[e-mail]>
CC: "Dean Naujoks" <[e-mail]>, "Mary Ann Harrison " <skyedog1 @cox.net>, "Rick Dove "
<[e-mail]>
Mike,
After discussions within the NRF, we have decided not to pursue a public hearing on the Clayton NPDES
modification issue. We will advise you in the future if we feel that things are heading in a direction that would
cause us to re-evaluate the situation.
Thanks.
Larry Baldwin
Lower Neuse Riverkeeper
Neuse River Foundation
220 S. Front Street
New Bern, NC 28560
[phone] - office
[phone] - cell
[phone] - fax
www.neuseriver.or
"A river is powerful because many drops of water have learned the secret of cooperation. "
1 of 1

follow-up re: clayton mod
Subject: follow-up re: clayton mod
From: Mike Templeton <[e-mail]>
Date: Thu, 10 Aug 2006 17:20:12 -0400
To: James Warren <[e-mail]>
CC: "Dunn, Glenn" <[e-mail]>, Cindy Finan <[e-mail]>, Alan Klimek
<[e-mail]>, Coleen Sullins <[e-mail]>, Bobby Blowe
<[e-mail]>, susan massengale <[e-mail]>
James - I appreciate you and Steve meeting with me this week and helping clarify your plans for addressing
the Town's wastewater & nutrient needs. Here is the note I just sent Dean Naujoks, re -capping the discussion he
and I had yesterday about Clayton's permit mod. I sent something similar to Dan McLawhorn, who has asked for
a copy of the draft permit. And I'm copying this to the NRCA, our Director, and a few others to make sure they
are aware of this week's turn of events. Please forward this to Steve and others as you see fit. Let me know
tomorrow if you have any questions or corrections, otherwise I'll get back in touch with you when I return in a
couple of weeks. - Mike Templeton
Original Message ---
Subject:follow-up to our discussion of clayton
Date:Thu, 10 Aug 2006 16:46:48 -0400
From:Mike Templeton <Mike.Templeton(a-ncmail.net>
To:dean.nrf(aatt.net
Dean -
Here's a quick summary of our discussion of Clayton yesterday. It recaps the new information I just got from the
Town, how it could affect their mod request, and the options I see for proceeding from here. The operative word
here is "quick," so let me know if I missed anything major.
Steve Biggs (Town Mgr.) and James Warren (ORC) met with me Tuesday seeking some clarification on the use
of their newly purchased nitrogen allocation. What I got from the meeting is that:
The Town fully expects to meet its existing TN limit for flows up its current 2.5 MGD capacity. It has
begun planning for an expansion to 8 MGD and is exploring ways to meet nitrogen limits at the higher
flow. As an interim step, the Town has entered into an agreement under which Raleigh will treat up to
MGD of Clayton's wastewater for 10 years (with an option for 10 years more).
• The Town did not buy allocation from SGWSA in order to increase its own TN limit. Instead, it will reserve
the new allocation for the flow it pumps to Raleigh. Construction Grants has said it will condition any
funding for the pump station/ force main project on the Town having sufficient allocation, ensuring that,
when the agreement with Raleigh ends and the flow is treated and discharged at the Clayton WWTP, the
Town will already have allocation for it.
Much of this was news to me, and it seems the Town simply did not know what it should ask for when it applied
for the mod. The upshot is that the Town does not need a permit modification at least not this one. I see at least
three ways to proceed from here:
• Modify the permit, as proposed, to increase the TN limit - not recommended; *
• Modify the permit, leaving the TN limit at its current value and adding a special condition that lists the
Town's allocations: 21,400 Ib/yr active, 7,336 Ib/yr in reserve - not necessary; **
• The Town can withdraw its request for the permit mod.
If the Town chooses to withdraw its request, there will no longer be a permit action, hence, no subject for a
public hearing. Withdrawal seems a reasonable course of action but leaves many of your comments/ questions/
concerns unanswered. I suggested that, if the Town withdraws its request, we (DWQ) should still arrange a
public meeting, a stakeholders' working meeting, or some other forum where we can work on the persistent
nutrient trading issues.
The Town is considering its options, and we will talk further when I return in two weeks.
1 of 2

follow-up re: Clayton mod
I understood that you will take all this back to the Foundation and get back to me. We, too, will talk again in two
weeks.
Once I've gotten caught up with you and the Town, we will figure out what the next steps are.
You asked for a copy of the current Neuse rules, and I am attaching a copy of the discharger rule for you (T15A
NCAC 02B .0234). Use the following link if you want to download a copy of the entire "Red Book," the full 02B
rule, which includes all of the Neuse nutrient rules:
http://h2o.enr.state.nc.us/admin/rules/documents/rbO8Ol04.pdf
Thanks for making time to discuss several Neuse/ Clayton/ trading issues yesterday. I hope we can work more
on these and improve our understanding of each other's concerns and perspectives.
- Mike Templeton
* Even with the 1st option, we will reduce the TN limit 2,100 Ib/yr from that in the draft and hold that part of the
new allocation in reserve. The correction is necessary to meet the rule's 3.5 mg/L cap for expanding discharges.
** Note that, if the Town chooses the 2nd option and decides later to "activate" its reserve allocation, it will first
have to get a permit mod to change its TN limit. Any change would have to meet existing NPDES and Neuse
rule requirements. The mod would be a major mod and so would be open to public review provisions of the
NPDES rules.
Michael E. Templeton, P.E.
Point Source Branch
Surface Water Protection Section
NCDENR• DWQ Raleigh, NC
Tel: [phone] x541
Fax: [phone]
Michael E. Templeton, P.E.
Point Source Branch
Surface Water Protection Section
NCDENR- DWQ Raleigh, NC
Tel: [phone] x541
Fax: [phone]
Content -Type: application/pdf
2B 0234 20021219.pdf Content -Encoding: base64
2of2

RE: clayton permit mod
Subject: RE: clayton permit mod
From: "McLawhorn, Dan"<Dan. [e-mail]. nc.us>
Date: Thu, 10 Aug 2006 16:51:59 -0400
To: "Mike Templeton" <[e-mail]>
CC: "Crisp, Dale" <[e-mail]>
Mike,
Thanks very much. I think you have answered my questions. I was concerned whether this was an effort to
expand discharge limits without plant improvements. I have also shared the information with Dale.
Dan McLawhorn
._:.----...-�.:—.,-....+-.....::.nmm..nee-.+-�:.:.:.::.m..:.::-.................,.�.............:..n.....:..m:..�n..e:.�-:._..,.-..-..a....<.•:..::.::>:::..�:-m::. nm-�.—..e—��.—:.-...:.....-....-...:.�.:... .. _ ... :—.. _....__..-ev-r----:•+mr.+��+nnn..nT
From: Mike Templeton[mailto:[e-mail]]
Sent: Thursday, August 10, 2006 4:40 PM
To: McLawhorn, Dan
Subject: clayton permit mod
Dan -
Susan Massengale forwarded your request for a copy of the draft permit mod for Clayton. I am
attaching the permit we sent out for review on July 3rd, as well as the fact sheet and cover letter.
Because the Riverkeepers got late word of the draft mod, I have extended the comment period to
August 21. The Riverkeepers have already requested a public hearing on the permit, and Alan
Klimek has agreed. I will be out of the office for the next two weeks and will schedule the hearing
when I return, if necessary (see below).
In case you aren't aware of it, there are some new developments affecting the permit proposal:
In a meeting earlier this week, the Town indicated that it intends to hold its new allocation in reserve
for the 1 MGD of wastewater they plan to send to Raleigh. So it doesn't need to increase its TN limit
nor modify its permit. There at least three ways to proceed with this:
• Modify the permit, as proposed, to increase the TN limit;*
• Modify the permit, leaving the TN limit at its current value and adding a special condition
listing the Town's*allocations: 21,400 lb/yr active, 7,336 lb/yr in reserve;
• The Town can withdraw its request, in which case there would be no need for a public hearing.
The Town is considering its options, and we will talk further when I get back to the office.
I discussed all this with Dean Naujoks yesterday, as well. I suggested that, if the Town opts to
withdraw its request, we could still arrange a public meeting, a stakeholders' working meeting, or
some other forum where we can work on the persistent issues with nutrient trading. Dean said he
would take all this back to the Foundation and get back to me.
When I get back in the office, we will consider how to proceed from here.
Let me know if you have any questions or comments. (Keep in mind I may not respond until after the
28th.)
- Mike Templeton
1 of 3

RE: clayton permit mod
* Note that, if we stay on this track, we will reduce the new limit 2,1001b/yr and hold that part of
the new allocation in reserve. The correction is necessary to meet the rule's 3.5 mg/L cap for
expanding discharges.
Michael E. Templeton, P.E.
Point Source Branch
Surface Water Protection Section
NCDENR• DWQ Raleigh, NC
Tel: [phone] x541
Fax: [phone]
Subject:
Clayton NPDES permit amendment
From:
"McLawhorn, Dan" <Dan.McLawhorn @,,ci.raleigh.nc.us>
Date:
Wed, 9 Aug 2006 12:27:27 -0400
To:
<susan.massengale(crncmail.net>
Susan,
I understand that a notice is outstanding for comment on a request by Clayton to use the nitrogen poundage
that it has purchased from Butner/DHHS. Will you have someone send me an electronic copy of the notice? I
would like to know if it involves a plant expansion or an increase in nitrogen poundage for the existing facility.
Thanks.
l)a.n AlcLawhom
Associate City Attorney
City of Raleigh
P.O. Box 590
Raleigh, NC 27601
[phone]
Email dan.mclawhorn(@ci.ralei2h.nc.us
fax [phone]
"E-mail correspondence to and from this address may be subject to the North Carolina Public
Records Law and may be disclosed to third parties by an authorized City or Law Enforcement
official."
"E-mail correspondence to and from this address may be subject to the North Carolina Public Records Law and
2of3 ��

RE: FWi Clayton - draft permit mod
Subject: RE: FW: clayton - draft permit mod
From: "Dean Naujoks" <[e-mail]>
Date: Mon, 7 Aug 2006 12:27:29 -0400
To:<Hyatt.Mar [e-mail]>
CC: "Mike Templeton" <[e-mail]>, <[e-mail]>, "William G. Ross"
<bill. ross@ncmail. net>, "Larry Baldwin" <[e-mail]>, "Robert Overman"
<[e-mail]>, <[e-mail]>, "Joe Seigler" <[e-mail]>, "Nat
Baggett" <[e-mail]>, "Phil Bowie" <[e-mail]>, "Richard Goodwin"
<rgoodwin41 @earthlink.net>, "RiverLaw" <[e-mail]>, "'Smoke Boyd"' <[e-mail]>,
"'David McCracken"' <[e-mail]>, "'Joanne Somerday"' <[e-mail]>, "'Mary Ann
Harrison"' <[e-mail]>, "'Sandy Parkerr" <[e-mail]>
Marshall,
Yes thank you for your response. I just found out Alan Klimik granted us
the public hearing. I understand the rational behind the NRCA and their
decision to trade and use these credits or alteast feel they have the
right to do so. However, this discharge has been completely eliminated
for quite some time. Yet we continue to have fish kills and the Neuse
Estuary is still impaired (and listed as nutrient sensitive waters). The
fact that a significant amount of additional nitrogen will be discharged
into already impaired waters will likely cause a violation of water
quality standards. The Clean Water Act prohibits such activity. My point
is the way trades are being conducted throughout the NRCA allows for
increased pollution "hot spots" to develop. Our argument has not changed
since the first time we challenged this. Last time they tried to
discharge additional nitrogen into an already impaired water body (Knapp
of Reeds Creek and the Upper End of Falls Lake which has pollution
problems). We feel this is the same issue: Expanding a discharge to add
increased nitrogen to already polluted water body (this time it's the
Neuse Estuary) .
Recent Peer reviewed data from Dr. Joann Burkholder of NCSU and 13 other
scientist concluded NC has not reached the targeted 30% nitrogen
reduction goal required under the current TMDL and the Neuse Rules. In
fact, we are not even close to reaching the goal. So how is the NRCA
allowed to introduce significant amounts of nitrogen into an already
impaired water body if it will further degrade water quality? The whole
NRCA trading plan is seriously flawed, they do not retire credits, they
do not reign in bad actors, they do not avoid the risk of creating "hot
spots" and they conduct trades out side of the trading association.
Thus, an Antidegradation Analysis is absolutely necessary because it has
"reasonable potential to cause or contribute to
downstream exceedances of NC water quality standards." This plan should
not move forward until one is completed. I am glad the EPA agrees.
Sincerely
Dean Naujoks
Upper Neuse Riverkeeper
-----Original Message -----
From: [e-mail]
[mailto:[e-mail]]
Sent: Monday, August 07, 2006 10:07 AM
To: [e-mail]
Cc: [e-mail]; [e-mail];
[e-mail]; [e-mail];
[e-mail]; [e-mail]
Subject: Re: FW: clayton - draft permit mod
Dean:
1 of 2

RE: FW: clayton - draft permit mod
I hope the following answers your two questions.
It's my understanding that NC is planning to hold a public hearing on
this permit.
Re antideg, as you know, Clayton is a co-permittee in the Neuse River
Association group permit. Due to the nature of that permit and because
the underlying TMDL is also based on an assumption of possible future
trading of TN, I do not believe that an antideg analysis is required.
Having said that, I will request that NC address the issue of whether
the traded TN has the reasonable potential to cause or contribute to
downstream exceedances of NC water quality standards in a revised permit
fact sheet.
Marshall
2 of 2

RE: clayton permit mod
Subject: RE: clayton permit mod
From: "Dean Naujoks" <[e-mail]>
Date: Sun, 6 Aug 2006 13:08:48 -0400
To: "'Alan Klimek"' <[e-mail]>
CC: "Dave Goodrich" <[e-mail]>, "Mike Templeton" <[e-mail]>
Alan,
Thank you for allowing us to have a public hearing on this important matter. We feel a public hearing is
absolutely necessary since no one down stream is aware of this plan. I do believe my accusations are well
founded. This is the second time in the last year and a half that DWQ "forgot' to tell us about large trades or
transfers they have approved. Considering we were so directly involved in this matter last time, we should
have been extended the courtesy of simply being contacted. I have worked with Mike Templeton and Dave
Goodrich in the past (on permit challenges) and have spent hours in their office discussing these matters and
learning a great deal from them. I have always said good things about the staff I have worked with at DWQ
and have maintained a good relationship. When I talk with media I don't beat up on DWQ, instead I constantly
talk about the need for DWQ to have additional resources and funding to do a better job of enforcement. I just
spoke to (Conservative) Representative Nelson Dollar the other day about this and he agreed with me. With
that said, I am extremely disappointed to hear Mike simply forgot to call us and let us know this was happening
considering our personal relationship and past involvement in this issue. I can not believe it to be honest with
you.
As far as having a fundamental concern over trading. Alan we were told by Mike and DWQ that things would
be different after last go round. NRCA even told us this. NRCA told us they were going to kick Butner out of
the NRCA, they told us they would never conduct trades above and below Falls Dam. DWQ indicated they
would do better with public notification, they would try to get NRCA do conduct trades with in EPA
guidelines -like retiring credits, conducting trades with in the association, avoiding hot spots etc... None of this
has happened --NOT ONE SINGLE THING.
So yes, we have serious concerns because DWQ simply is ignoring how NRCA is conducting these trades
and ignoring guidelines set by EPA. These additional nutrients will have a direct impact on the Neuse Estuary
which is impaired. This is a violation of the Clean Water Act no matter how you look at it because the NRCA
will not adhere to appropriate guidelines to avoid problems like hot spots. If DWQ is not going to address
serious flaws for this horrible policy of nutrient trading, than we will have to do it. We have asked DWQ to
address this and you have ignored our requests. I am sorry you don't see it differently, but we have been trying
to work with you. I even tried to get Raleigh to push for these changes internally, but their own Public Utilities
Director supports an inappropriate trading policy that continues to violate the federal Clean Water Act and
ignore EPA guide lines. We have done everything we could possibly do to make reforms and it has fallen on
deaf ears.
Dean Naujoks
Upper Neuse Riverkeeper
-----Original Message -----
From: Alan Klimek [mailto:[e-mail]]
Sent: Friday, August 04, 2006 4:26 PM
To: [e-mail]
Cc: 'Mike Templeton'; William G. Ross
Subject: Re: clayton permit mod
Dean,
I am willing to schedule one hearing on this matter to receive public input, most likely
sometime in September. We will certainly let you know of the details when they are arranged.
We appreciate the fine work you River Keepers do for the state. However, I do not find your
accusations below to be helpful. Mike has explained what happened, our clear intent is to
keep you informed of all significant matters involving the Neuse River and we have most
certainly met all of our legal obligations. To talk about "broken trust" seems extreme. Staff
and I would be happy to meet with you and others to discuss this issue. You seem to have a
1 of 2

RE: clayton permit mod
fundamental concern over trading, which is allowed under the rules. Perhaps this forum
would allow us to explore options for improvements in our management strategy.
Alan
Dean Naujoks wrote:
Mike,
When will we hear about our public hearing request? Please let us know immediately. This significant
increase warrants a public hearing. Down stream municipalities have no idea this increased discharge
is going to occur. They need a chance to provide input since you did not adequately inform the public.
We heard the same apology before Mike about why we were not informed the last time DWQ
approved the credits in the NRCA permit. I am really disappointed in you as I thought we had a
relatively good working relationship with you and other DWQ employee's. You are the one directly
responsible for this broken trust -not us. We want a public hearing.
Dean Naujoks
Upper Neuse Riverkeeper
-----Original Message -----
From: Mike Templeton[mailto:Mike.Templeton([e-mail]]
Sent: Friday, August 04, 2006 10:19 AM
To: Larry Baldwin
Cc: [e-mail]; [e-mail]; [e-mail]; Alan Klimek
Subject: clayton permit mod
Larry -
2of2

comment period - cayton permit mod
Subject: comment period - cayton permit mod
From: Mike Templeton <[e-mail]>
Date: Fri, 04 Aug 2006 11:50:50 -0400
To: James Warren <[e-mail]>
CC: "Dunn, Glenn" <[e-mail]>, Jim Wrenn <[e-mail]>, Gil Vinzani
<[e-mail]>
James -
This is to let you know that I am extending the,comment period on the draft Clayton permit to August 21. The
extension is to accommodate the Neuse River' Foundation and riverkeepers; however, it applies to all
commentors. Also for your information, the riverkeepers have requested a public hearing on the permit. We have
not yet responded to their request.
- Mike Templeton
Michael E. Templeton, P.E.
Point Source Branch
Surface Water Protection Section
NCDENR• DWQ Raleigh, NC
Tel: [phone] x541
Fax: [phone]
1 of 1

clayton permit mod
Subject: clayton permit mod
From: Mike Templeton <[e-mail]>
Date: Fri, 04 Aug 2006 11:19:27 -0400
To: Larry Baldwin <[e-mail]>
CC: dean. nrf@att. net, [e-mail], [e-mail], Alan Klimek <[e-mail]>
Larry -
I'm not sure what part of our conversation gave you the impression DWQ or I aren't interested in public comment
on the draft permit. Rather, I had hoped to assure you that we value that input and said that, while comments are
due by the 7th, we would allow you more timW f needed. I also believe the remarks that we did not notify the
public and bypassed the NRF and riverkeepers are misinformed. We took the same steps to notify the public of
Clayton's draft permit as we do any NPDES permit, in this case publishing legal ads in two local newspapers*. It
was my understanding that you had already heard of the nitrogen trade indirectly by the time the permit went out
for public review. Still I planned to drop you or. Dean (or both) a note when the notice went out, just as I had done
a few weeks earlier with the Smith Creek WWTP mod** but got distracted by a flurry of activity at that time. I
apologize for my oversight and am extending the public review period to August 21 so you and others have more
time to prepare your comments. I hope this satisfies any concerns you have about adequate opportunity for
input. I am copying Bill Olah so that the Foundation is aware of the extension.
We have worked diligently with the Foundation and the riverkeepers through these past two permit cycles and
made the extra effort to ensure your comments and concerns were heard. We continue to support your
involvement. Toward that end, I will work with our permit coordinator to make sure we also notify you routinely of
any mid -cycle permit actions and avoid the sort of confusion we have over this particular mod.
Regards.
- Mike Templeton
* Notices were published 7/5 in the News & Observer, 717 in the Smithfield Herald.
** I emailed the note to Dean on 5/19.
Michael E. Templeton, P.E.
Point Source Branch
Surface Water Protection Section
NCDENR• DWQ Raleigh, NC
Tel: [phone] x541
Fax: [phone]
1 of 1

DOWNSTREAM
220 South Front Street
New Bern, NC 28560
252.637-7972
252-514.0051 Fax
UPSTREAM
112 South Blount Street
Raleigh, NC 27601
919-856-1180
919-839-0767 Fax
Lower Neuse,
Larry Baldwin
252-637-7972
Rivcrkeep=@=uscnver.org
Upper Neuse,
Dean Naujoks
919-856.1180
Deaa.nd@attnet
BOARD OF DIRECTORS
Natalie Haggett
Phil Bowie
James Boyd
Richard Dove
Richard Goodwin
Mary Ann Harrison
David McCracken
William Olah
Robert Overman
Sandra Parker
Joanne Somerday
raesa
Earth Share
Meuse River Foundation, Inc.
P.O. Box 15451 • New Bern, NC 28561
[e-mail] www.neuseriver.org
ID���
P nnt
August 4, 2006
Mr. Michael Templeton —---------_—_ -.,
NC Division of Water Quality
Point Source Branch
1617 Mail Service Center
Raleigh, NC 27699-1617
Re: Clayton -Little Creek WRF; NPDES Permit #NC0025453
Dear Mike,
Please accept this letter as an official comment on the proposed permit
modification for the Clayton -Little Creek WRF (NPDES Permit #NC0025453),
located in Johnson County.
First, let me comment on the availability of notification that this permit request
was being submitted. Given the interest and the involvement from both Neuse
Riverkeepers, as well as the Neuse River Foundation (NRF) Board of Directors
and members, it would seem very clear that we would also have a great deal of
interest in this permit modification request. We feel that efforts to notify the NRF
Riverkeepers should have taken on a special concern from the Division of Water
Quality (DWQ) because of our involvement in the issue of nutrient trading in the
past.
At this time, we are formally requesting that public hearings be scheduled to
allow for adequate concerns and comments to be heard. It is our contention that
the introduction of 7,336 lb/yr additional nitrogen (TN) discharge from the
Clayton -Little Creek WRF is a burden that the nutrient sensitive nature of the
Neuse River should not be forced to bear. Likewise, the additional loading of
3668 lb/yr TN to the estuary, based on the transport factor of 50%, puts an undo
strain on this part of the Neuse River system. The additional 3668 lb/yr marks a
significant increase over the net zero addition which occurred after the Bay River
Metropolitan Sewerage District removed their direct discharge to the estuary.
This is an unacceptable impact to the Neuse River from the Clayton -Little Creek
WRF all the way to the estuary, and we will work to see that it does not occur.
Federal regulations prohibit such a permitted discharge. No new permit maybe
issued to a new source or new discharger [defined as increased discharge as
We Speak For The River!
0

well], if the discharge from its construction or operation will cause or contribute
to the violation of water quality standards " 40CFR122.4(i).
We had hopes that our work on the Butner issue of nutrient trading would have
sufficiently raised the awareness level that this program is not a good way to treat
our river. Apparently that is not the case, and the DWQ is content to authorize a
major modification to a permit with little regard for potential environmental
impacts to the Neuse River estuary, which is listed as an impaired water body.
The DWQ has disregarded the past concerns raised by citizens and elected
officials regarding inherent flaws within the current pollution trading scheme
which continues to pose risks to water quality and human health by creating "hot
spots" (very high concentrations of problem pollutants) in the Neuse River
estuary. Unwanted consequences of pollution trading often result in these "hot
spots", along with a weakening of enforcement provisions or inequities from
allowing trading within large watersheds. Therefore, we are requesting a formal
Antidegradation Review of the proposed increased discharge.
Federal regulations also require protection of existing uses in all waters. Existing
uses include: a) current uses, b) any uses that have occurred since November 28,
1975) and c) any uses for which the water quality is suitable even if they are not
occurring. As stated in the U.S. EPA Water Quality Standards Handbook: "Ifa
planned activity will foreseeably lower water quality to the extent that it no longer
is sufficient to protect and maintain the existing uses in that water body, such an
activity is inconsistent with EPA's antidegradation policy ... In such a
circumstance, the planned activity must be avoided or adequately mitigation or
preventative measures must be taken to ensure that the ' existing uses and the
water quality to protect them will be maintained " (Section4.4)
What alternatives/options have been studied and reviewed that would allow the
Clayton -Little Creek WRF to better control their nitrogen discharge without
taking the easy way out by purchasing nitrogen credits? It would make sense to
us that all possibilities would be researched, and the results of that research would
be made public. We don't feel that the DWQ has paid due respect to studies that
have been performed that indicate that the state has not achieved any significant
reduction in nitrogen loading as required by our TMDL ( "Comprehensive trend
analysis of nutrients and related variables in a large eutrophic estuary: A decadal
study of anthropogenic and climatic influences' , Cavell Brownie and Joy Smith,
Department of Statistics, North Carolina State University, Raleigh, NC 27695, et
al.) The fact that little, if any, nitrogen reductions have been achieved should be a
red flag that we can not continue allowing increased discharges, but should
instead look for ways to reduce the nitrogen at the source.
In closing, we are requesting that public hearings be schedule for the matter of the
modified NPDES permit request from Clayton -Little Creek WRF, and that the
modified permit not be issued pending these hearings.

Sincere i-'
S
L in Dean Naujoks
Lower Neuse Riverkeeper® Upper Neuse Riverkeeperg
Richard Dove
President, Neuse River Foundation
CC: Alan Klimek, Director
Division of Water Quality
1617 Mail Service Center
Raleigh, NC 27699-1617
James D. Giattina, Director
Water Management Division
U.S. Environmental Protection Agency
Region 4
Sam Nunn Atlanta Federal Center
61 Forsyth Street, SW
Atlanta, GA 30303-8960

AFFIDAVIT OF PUBLICATION
NORTH CAROLINA.
Wake County. Ss.
Before the undersigned, a Notary Public of Chatham
County North Carolina, duly commissioned and authorized to
administer oaths, affirmations, etc., personally appeared Debra
Peebles, who, being duly sworn or affirmed, according to law,
doth depose and say that she is Billing Manager -Legal
Advertising of The News and Observer a corporation
organized and doing business under the Laws of the State of
North Carolina, and publishing a newspaper known as The
News and Observer, in the City of Raleigh , Wake
County and State aforesaid, the said newspaper in which such
notice, paper, document, or legal advertisement was published
was, at the time of each and every such publication, a
newspaper meeting all of the requirements and qualifications
of Section 1-597 of the General Statutes of North Carolina and
was a qualified newspaper within the meaning of Section I-
597 of the General Statutes of North Carolina, and that as such
she makes this affidavit; that she is familiar with the books,
files and business of said corporation and by reference to the
files of said publication the attached advertisement for NC
DIVISION OF WATER QUALITY was inserted in the
aforesaid newspaper on dates as follows: 07/05/06
Account Number: 73350831
Adv�'
the books and files of the aforesaid Corporation and publication.
Debra Peebles, Billing Manager -Legal Advertising
Wake County, North Carolina
Sworn or affirmed to, and subscribed before me, this
07 day of JULY , 2006 AD ,by Debra Peebles.
In Testimony Whereof, I have hereunto set my hand
and affixed my official seal`thh day and year aforesaid.
anet Scroggs, Notary 25
My commission expires 10 of March 2009.

o�OF Wf�TF�pG
� r
7 N'
O Y
Mr. Steve Biggs, Manager
Town of Clayton
P.O. Box 879
Clayton, North Carolina 27520
July 3, 2006
Michael F. Easley, Govemor
State of North Carolina
William G. Ross, Jr., Secretary
Department of Environment and Natural Resources
Plan W. Klimek, P.E., Director
Division of Water Quality
Subject: Draft NPDES Permit Modification
Permit NCO025453
Clayton - Little Creek WRF
Johnston County
Dear Mr. Biggs:
The Division has reviewed your June 8, 2006, request to modify the NPDES permit for the
Town's Little Creek WRF and has made a tentative determination to modify the permit as
requested. We are enclosing a copy of the draft permit and fact sheet for your review and
comment.
The proposed modification will increase the Town's Total Nitrogen (TN) discharge limits from
21,400 to 28,736 lb/yr, reflecting your recent purchase of 7,3361b/yr of discharge TN
allocation (3,6681b/yr as estuary allocation) from the South Granville Water and Sewer
Authority. The change becomes effective January 1, 2007, and is conditioned upon prior
closure of the purchase per the Agreement of Purchase and Sale.
The draft permit also includes one minor correction, changing a previous reference on its cover
page from the Water Quality Commission to the Environmental Management Commission.
At this time, the Division is submitting a notice to the newspapers of general circulation in
Wake County, inviting public comment on the draft modification. The notice is scheduled for
publication on or about July 7. Following a 30-day comment period, we will review all pertinent
comments received and take appropriate action on the permit.
Please provide any comments you have regarding the draft permit to this office, in
writing, no later than August 7.
If you have any questions concerning the draft permit, please contact me at [phone],
extension 541, or at mike. templetoriOncmaiLnet
Sincerely,
Mtcha 1 E. Templet n, P.E.
Point Source Branch
Enclosure: Draft permit modification, NCO025453
Fact Sheet
Copies: James C. Wrenn, Jr. - Hopper, Hicks & Wrenn, LLP: PO Box 247: Oxford, NC 27565
Chief. NPDES and Biosolids Permits Section, Region 1V, EPA
Raleigh Regional Office, Surface Water Protection
Central Files
lFNPDES Files
Division of Water Quality, Point Source Branch Telephone [phone]
1617 Mail Service Center, Raleigh, North Carolina 27699-1617 FAX [phone]r,.,1,Carolina
512 N. Salisbury Stree4 Raleigh, North Carolina 27604 On the Internet at http://h2o.enr.state.nc.us/ � ankrAMY
An Equal Opponuniy/Affirmative Action Employer

I
Permit No. NCO025453
STATE OF NORTH CAROLINA
DEPARTMENT OF ENVIRONMENT AND NATURAL RESOURCES
. DIVISION OF WATER QUALITY
PERMIT
TO DISCHARGE WASTEWATER UNDER THE
NATIONAL POLLUTANT DISCHARGE ELIMINATION SYSTEM
In compliance with the provisions of North Carolina General Statute 143-215.1, other lawful
standards and regulations promulgated and adopted by the North Carolina Environmental
Management Commission, and the Federal Water Pollution Control Act, as amended, the
Town of Clayton
Little Creek Water Reclamation Facility
is hereby authorized to discharge wastewater from a facility located at
Little Creek Water Reclamation Facility
On Durham Street Extension
Clayton
Johnston County
to receiving waters designated as the Neuse River in the Neuse River Basin
in accordance with the discharge limitations, monitoring requirements, and other conditions set
forth in Parts I, II, III, and IV hereof.
This permit shall become effective........................................................................
This permit and the authorization to discharge shall expire at midnight on .................March 31, 2008.
Signed this day ..............
DRAFT
Alan W. Klimek, P.E., Director
Division of Water Quality
By the Authority of the Environmental
Management Commission
Issued March 11, 2003 Clayton WWTP
Modified NPDES No. NCO025453

SUPPLEMENT TO PERMIT COVER SHEET
Town of Clayton
Little Creek Water Reclamation Facility
is hereby authorized to:
Permit No. NCO025453
1. Continue to operate an existing 1.9 MGD wastewater treatment facility
consisting of a mechanical bar screen, grit removal, parshall flume with flow
measurement, primary clarifier/digester, trickling filter, dual oxidation ditches,
dual secondary clarifiers, tertiary filters, ultraviolet disinfection, chlorine --
contact chamber, sulfur dioxide dechlorination, sludge thickener tank, aerobic
sludge digester, and sludge drying beds located at the Little Creek Water
Reclamation Facility, Durham Street Extension, Clayton, Johnston County, and
2. Discharge wastewater from said treatment works at the location specified on the
attached map into the Neuse River, which is classified WS-IV NSW CA waters, in
the Neuse River Basin.
3. After receiving an Authorization to Operate from the Division of Water Quality,
the Town may operate the facility to a maximum design flow of 2.5 MGD, and
discharge to the point listed above.
Town of Clayton
NPDES No. NC0025453

A. (1.) EFFLUENT LIMITATIONS AND MONITORING REQUIREMENTS — FINAL
During the period beginning on the effective date of the permit and lasting until expansion or
expiration, the Permittee is authorized to discharge 1.9 MGD of municipal wastewater from outfall
001. Such discharges shall be limited and monitored by the Permittee as specified below:
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Flow
1.9MGD
Continuous
Recording
Influent or
Effluent
BOD, 5 day (20°C)2
[April 1— October 31]
5.0 mgll
7.5 mg/I
Daily
Composite
Influent &
Effluent
BOD, 5 day (20°C)2
[November 1— March 31 ]
10.0 mgll
15.0 mgll
Daily
Composite
Influent &
Effluent
Total Suspended Res1due2
30.0 mgll
45.0 mg/l
Daily
Composite
Influent &
Effluent
NH3 as N [April 1— October 311
2.0 m /I
6.0 m
Daily
Composite
Effluent
NH3 as N[November 1— March LIL
4.0 m /l
12.0 m /I
Daily
Composite
Effluent
Dissolved Oxyged
Daily
Grab
Effluent
Dissolved Oxygen
31Week
Grab
Upstream &
Downstream
Fecal Coliform(geometric mean
200/100 ml
400/100 ml
Daily
Grab
Effluent
Fecal Coliform (geometric mean)
3/Week
Grab
Upstream &
Downstream
Total Residual Chlorine4
28 µgll
Daily
Grab
Effluent
TKN (mgll)
Monitor & Report
Weekly
Composite
Effluent
NO2-N + NO3-N (mg/1)
Monitor & Report
Weekly
Composite
Effluent
TN (mgll)5
Monitor & Report
Weekly
Composite
Effluent
Total Monthly Flow (MG)
Monitor & Report
Monthly
Calculated
Effluent
TN Load6
Monitor & Report (lb/month)
21,400 lb/year Annual Mass Loadin 7,8
Monthly
Annually
Calculated
Calculated
Effluent
Effluent
Total Phosphorus 9
2.0 mg/L (Quarterly Average)
Weekly
Composite
Effluent
Temperature °C
Daily
Grab
Effluent
Temperature (C)
3/Week
Grab
Upstream &
Downstream
Conductivity
Daily
Grab
Effluent
Conductivity
3/Week
Grab
Upstream &
Downstream
Chronic Toxici 10
Quarterly
Composite
Effluent
Copper
Monthly
Composite
Effluent
Zinc
Monthly
Composite
Effluent
Silver
Monthly
Composite
Effluent
H11
6-9
Daily
Grab
Effluent
(Footnotes on next page)
Issued March 11, 2003 Town of Clayton
Modified NPDES No. NC0025453

A. (1.) EFFLUENT LIMITATIONS AND MONITORING REQUIREMENTS - FINAL
(Continued)
Footnotes:
1. Sample locations: E - Effluent, I - Influent, U - Upstream at NCSR 1700, D - Downstream at
(1) NC Highway 42 and (2) NCSR 1908. Stream samples shall be grab samples and shall be
collected 3/Week during June - September and 1 / Week during the remaining months of the.
year. Instream monitoring is provisionally waived in light of the permittee's
participation in the Lower Neuse Basin Association. Instream monitoring shall be
conducted as stated in this permit should the permittee end its participation in the
Association.
Per 15A NCAC 2B .0505(c)(4), stream sampling (as well as influent/effluent sampling) may be
discontinued when flow conditions could result in injury or death of the person(s) collecting
the samples. In such cases, on each day that sampling is discontinued, written justification
shall be specified in the monitoring report for the month in which the event occurred.
2. The monthly average effluent BOD5 and Total Suspended Residue concentrations shall not
exceed 15% of the respective influent value (85% removal).
3. The daily average dissolved oxygen effluent concentration shall not be less than 6.0 mg/l.
4. Total residual chlorine is required only if chlorine is used as a disinfectant (or elsewhere in the
process).
5. TN means Total Nitrogen. For a given wastewater sample, TN is the sum of Total Kjeldahl
Nitrogen and Nitrate -Nitrite Nitrogen: TN. = TKN + NO2-N + NO3-N.
6. TN Load is the mass load of TN discharged by the Permittee in a period of time. See Special
Condition A.(3.), Calculation of TN Loads.
7. The annual TN Load limit shall become effective with the calendar year beginning on January
1, * 2003. Compliance with this limits shall be determined in accordance with Special Condition
A.(4.), Annual Limits for Total Nitrogen.
8. Effective January 1, 2007, the TN Load limit shall increase to 28,736 lb/yr; provided that the
Permittee demonstrates to the Division the closure of its purchase. of 7,336 lb/yr allocation
(3,668 lb/.yr at estuary) from the South Granville Water and Sewer Authority according to the
Agreement of Purchase and Sale.
9. The `quarterly average for total phosphorus shall be the average of composite samples collected
weekly during the calendar quarter (January -March, April -June, July -September, October -
December).
10. Chronic Toxicity (Ceriodaphnia dubia) P/F at.1.6%: March, June, September, and December
[see Special Condition A.(5)]. Toxicity monitoring shall coincide with metals monitoring.
11. The pH shall not be less than 6.0 standard units nor greater than 9.0 standard units and shall
be monitored daily at the effluent by grab sample.
There shall be no discharge of floating solids or visible foam in other than trace amounts.
Town of Clayton
Issued March 11, 2003
NPDES No. NCO025453
Modified

A. (2.) EFFLUENT LIMITATIONS AND MONITORING REQUIREMENTS — FINAL
During the period beginning upon expansion above 1.9 MGD or expiration, the Permittee is
authorized to discharge up to 2.5 MGD of municipal wastewater from outfall 00 L Such
discharges shall be limited and monitored by the Permittee as specified below:
1 "r ' =F' 1. T. •?Lh. r+a,. y. k'T
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Flow
2.5 MGD
Continuous
Recording
Influent or
Effluent
BOD, 5 day (20°C)2
[April 1- October 31]
5.0 mgil
7.5 mg/l
Daily
Composite
Influent &
Effluent
BOD, 5 day (20°C)2
[November 1- March 31 ]
10.0 mg/l
15.0 mgA
Daily
Composite
Influent &
Effluent
Total Suspended Residue2
30.0 mg/l
45.0 mg/l
Daily
Composite
Influent &
Effluent
NH3 as N Aril 1— October 31
1.0 mg/l
3.0 mg/l
Daily
Composite
Effluent
NH3 as N November 1— March 31
2.0 mg/l
6.0 mg/1
Daily
Composite
Effluent
Dissolved Oxyged
Daily
Grab
Effluent
Dissolved Oxygen
3JWeek
Grab
Upstream &
Downstream
Fecal Coliform(geometric mean
200/100 ml
400/100 ml
Daily
Grab
Effluent
Fecal Coliform (geometric mean)
31Week
Grab
Upstream &
Downstream
Total Residual Chlorine4
28 µgll
Daily
Grab
Effluent
TKN (mg/1)
Monitor & Report
Weekly
Composite
Effluent
NO2-N + NO3-N (mg/l)
Monitor & Report
Weekly
Composite
Effluent
TN (mgll)5
Monitor& Report
Weekly
Composite
Effluent
Total Monthly Flow (MG)
Monitor & Report
Monthly
Calculated
Effluent
TN Load6
Monitor & Report (lb/month)
21,400 lb/year Annual Mass Loadin 7,8
Monthly
Annually
Calculated
Calculated
Effluent
Effluent
Total Phosphorus 9
2.0 mg/L (Quarterly Average)
Weekly
Composite
Effluent
Temperature °C
Daily
Grab
Effluent
Temperature (C)
3/Week
Grab
Upstream &
Downstream
Conductivity
Daily
Grab
Effluent
Conductivity
3/Week
Grab
Upstream &
Downstream
Chronic Toxicityl0
Quarterly
Composite
Effluent
Copper
Monthly
Composite
Effluent
Zinc
Monthly
Composite
Effluent
Silver
Monthly
Composite
Effluent
H11
6-9
Daily.
Grab
Effluent
(Footnotes on next page)
Issued March 11, 2003 Town of Clayton
Modified NPDES No. NCO025453

A. (2.) EFFLUENT LIMITATIONS AND MONITORING REQUIREMENTS - FINAL
(Continued)
Footnotes:
1. Sample locations: E - Effluent, I - Influent, U - Upstream at NCSR 1700, D - Downstream at
(1) NC Highway 42 and (2) NCSR 1908. Stream samples shall be grab samples and shall be
collected 3/Week during June - September and 1/Week during the remaining months of the
year. Instream monitoring is provisionally waived in light of the permittee's
participation in the Lower Neuse Basin Association. Instream monitoring shall be
conducted as stated in this permit should the permittee end its participation in the
Association.
Per 15A NCAC 213.0505(c)(4), stream sampling (as well as influent/effluent sampling) may be
discontinued when flow conditions could result in injury or death of the person(s) collecting
the samples. In such cases, on each day that sampling is discontinued, written justification
shall be specified in the monitoring report for the month in which the event occurred.
2. The monthly average effluent BOD5 and Total Suspended Residue concentrations shall not
exceed 15% of the respective influent value (85% removal).
3. The daily average dissolved oxygen effluent concentration shall not be less than 6.0 mg/l.
4. Total residual chlorine is required only if chlorine is used as a disinfectant (or elsewhere in the
process).
5. TN means Total Nitrogen. For a given wastewater sample, TN is the sum of Total Kjeldahl
Nitrogen and Nitrate -Nitrite Nitrogen: TN = TKN + NO2-N + NO3-N.
6. TN Load is the mass load of TN discharged by the Permittee in a period of time. See Special
Condition A. (3.), Calculation of TN Loads.
7. The annual TN Load limit shall become effective with the calendar year beginning on January
1, 2003. Compliance with this limits shall be determined in accordance with Special Condition
A.(4.), Annual Limits for Total Nitrogen.
8. Effective January 1, 2007, the TN Load limit shall increase to 28,736 lb/yr; provided that the
Permittee demonstrates to the Division the closure of its purchase of 7,336 lb/yr allocation
(3,668 lb/yr at estuary) from the South Granville Water and Sewer Authority according to the
Agreement of Purchase and Sale.
9. The quarterly average for total phosphorus shall be the average of composite samples collected
weekly during the calendar quarter (January -March, April -June, July -September, October -
December).
10. Chronic Toxicity (Ceriodaphnia dubia) P/Fat 2.0 %: March, June, September, and December
[see Special Condition A.(6)]. Toxicity monitoring shall coincide with metals monitoring.
11. The pH shall not be less than 6.0 standard units nor greater than 9.0 standard units and shall
be monitored daily at the effluent by grab sample.
There shall be no discharge of floating solids or visible foam in other than trace amounts.
Issued March 11, 2003 Town of Clayton
NPDES No. NCO025453
Modified

I
z
A.(3.) CALCULATION OF TOTAL NITROGEN LOADS
a. The Permittee shall calculate monthly and annual TN Loads as follows:
1. Monthly TN Load (lb/mo) = TN x TMF x 8.34
where:
TN = the average Total Nitrogen concentration (mg/ L) of the
composite samples collected during the month
TMF = the Total Monthly Flow of wastewater discharged during the
month (MG/mo)
8.34 = conversion factor, from (mg/ L x MG) to pounds
ii. Annual TN Load (lb/yr) = Sum of the 12 Monthly TN Loads for the calendar year
b. The Permittee shall report monthly Total Nitrogen results (mg/ L and lb/ mo) in the discharge
monitoring report for that month and shall report each year's annual results (lb/yr) in the .
December report for that year.
A.(4.) ANNUAL LIMITS FOR TOTAL NITROGEN
a. Total Nitrogen (TN) allocations and TN Load limits for NPDES dischargers in the Neuse River
basin are annual limits and are applied for the calendar year.
b. For any given calendar year, the Permittee shall be in compliance with the annual TN Load
limit in this Permit if:
i. the Permittee's annual TN Load is less than or equal to said limit, or
ii. the Permittee is a Co-Permittee Member of a compliance association.
c. The TN Load limit in this Permit (if any) may be modified as the result of allowable changes
in the Permittee's TN allocation.
i. Allowable changes include those resulting from purchase of TN allocation from the
Wetlands Restoration Fund; purchase, sale, trade, or lease of allocation between the
Permittee and other dischargers; regionalization; and other transactions approved by the
Division.
ii. The Permittee may request a modification of the TN Load limit in this Permit to reflect
allowable changes in its TN allocation. Upon receipt of timely and proper application, the
Division will modify the permit as appropriate and in accordance with state and federal
program requirements.
iii. Changes in TN limits become effective on January 1 of the year following permit
modification. The Division must receive application no later than August 31 for changes
proposed for the following calendar year.
iv. Application shall be sent to:
NCDWQ / NPDES Unit
Attn: Neuse River Basin Coordinator
Mail Service Center
Raleigh, NC . 27699-1617
Town of Clayton
NPDES No. NCO025453

d. If the Permittee is a member and co-permittee of an approved compliance association, its TN
discharge during that year is governed by that association's group NPDES permit and the TN
limits therein.
i. The Permittee shall be considered a Co-Permittee Member for any given calendar year in
which it is identified as such in Appendix A of the association's group NPDES permit.
ii. Association roster(s) and members' TN allocations will be updated annually and in
accordance with state and federal program requirements.
iii. If the Permittee intends to join or leave a compliance association, the Division must be
notified of the proposed action in accordance with the procedures defined in the
association's NPDES permit.
(1) Upon receipt of timely and proper notification, the Division will modify the permit
as appropriate and in accordance with state and federal program requirements.
(2) Membership changes in a compliance association become effective on January 1
of the year following modification of the association's permit.
e. The TN monitoring and reporting requirements in this Permit remain in effect until
expiration of this Permit and are not affected by the Permittee's membership in a compliance
association.
A. (5.) CHRONIC TOXICITY PERMIT LIMIT (QRTRLY)
The effluent discharge shall at no time exhibit observable inhibition of reproduction or significant
mortality to Ceriodaphnia dubia at an effluent concentration of 1.6 %.
The permit holder shall perform at a minimum, auartemonitoring using test procedures
outlined in the "North Carolina Ceriodaphnia Chronic Effluent Bioassay Procedure," Revised
February 1998, or subsequent versions or "North Carolina Phase 1I Chronic. Whole Effluent
Toxicity Test Procedure" (Revised -February 1998) or subsequent versions. The tests will be
performed during the months of March, June, September, and December. Effluent sampling for
this testing shall be performed at the NPDES permitted final effluent discharge below all treatment
processes.
If the test procedure performed as the first test of any single quarter results in a failure or ChV
below the permit limit, then multiple -concentration testing shall be performed at a minimum, in
each of the two following months as described in "North Carolina Phase II Chronic Whole Effluent
Toxicity Test Procedure" (Revised -February 1998) or subsequent versions.
The chronic value for multiple concentration tests will be determined using the geometric mean of
the highest concentration having no detectable impairment of reproduction or survival and the
lowest concentration that does have a detectable impairment of reproduction or survival. The
definition of "detectable impairment," collection methods, exposure regimes, and further statistical
methods are specified in the "North Carolina Phase II Chronic Whole Effluent Toxicity Test
Procedure" (Revised -February 1998) or subsequent versions.
All toxicity testing results required as part of this permit condition will be entered on the Effluent
Discharge Monitoring Form (MR-1) for the months in which tests were performed, using the
parameter code TGP3B for the pass/fail results and THP3B for the Chronic Value. Additionally,
DWQ Form AT-3 (original) is to be sent to the following address:
Attention: North Carolina Division of Water Quality
Environmental Sciences Branch
1621 Mail Service Center
Raleigh, North Carolina 27699-1621
Town of Clayton
NPDES No. NC0025453

A. (5.) CHRONIC TOXICITY PERMIT LIMIT (QRTRLY) (cont'd.)
Completed Aquatic Toxicity Test Forms shall be filed with the Environmental Sciences Branch no
later than 30 days after the end of the reporting period for which the report is made.
Test data shall be complete, accurate, include all supporting chemical/physical measurements
and all concentration/response data, and be certified by laboratory supervisor and ORC or
approved designate signature. Total residual chlorine of the effluent toxicity sample must be
measured and reported if chlorine is employed for disinfection of the waste stream.
Should there be no discharge of flow from the facility during a month in which toxicity monitoring
is required, the permittee will complete the information located at the top of the aquatic toxicity
(AT) test form indicating the facility name, permit number, pipe number, county, and the
month/year of the report with the notation of "No Flow" in the comment area of the form. The
report shall be submitted to the Environmental Sciences Branch at the address cited above.
Should the permittee fail to monitor during a month in which toxicity monitoring is required,
monitoring will be required during the following month.
Should any test data from this monitoring. requirement or tests performed by the North Carolina
Division of Water Quality indicate potential impacts to the receiving stream, this permit may be re-
opened and modified to include alternate monitoring requirements or limits.
NOTE: Failure to achieve test conditions as specified in the cited document, such as minimum
control organism survival, minimum control organism reproduction, and appropriate
environmental controls, shall constitute an invalid test and will require immediate follow-up
testing to be completed no later than the last day of the month following the month of the initial
monitoring.
A. (6.) CHRONIC TOXICITY PERMIT LIMIT (QRTRLY)
The effluent discharge shall at no time exhibit observable inhibition of reproduction or significant
mortality to Ceriodaphnia dubia at an effluent concentration of 2.0 %.
The permit holder shall perform at a minimum, guarterlra monitoring using test procedures
outlined in the "North Carolina Ceriodaphnia Chronic Effluent Bioassay Procedure,_" Revised
February 1998, or subsequent versions or "North Carolina Phase II Chronic Whole Effluent
Toxicity Test Procedure" (Revised -February 1998) or subsequent versions. The tests will be
performed during the months of March, June, September, and December. Effluent sampling for
this testing shall be performed at the NPDES permitted final effluent discharge below all treatment
processes.
If the test procedure performed as the first test of any single quarter results in a failure or ChV
below the permit limit, then multiple -concentration testing shall be performed at a minimum, in
each of the two following months as described in "North Carolina Phase II Chronic Whole Effluent
Toxicity Test Procedure" (Revised -February 1998) or subsequent versions.
Town of Clayton
NPDES No. NCO025453

A. (6.) CHRONIC TOXICITY PERMIT LIMIT (QRTRLY) (cont'd.)
The chronic value for multiple concentration tests will be determined using the geometric mean of
the highest concentration having no detectable impairment of reproduction or survival and the
lowest concentration that does have a detectable impairment of reproduction or survival. The
definition of "detectable impairment," collection methods, exposure regimes, and further statistical
methods are specified in the "North Carolina Phase II Chronic Whole Effluent Toxicity Test
Procedure" (Revised -February 1998) or subsequent versions.
All toxicity testing results required as part of this permit condition will be entered on the Effluent
Discharge Monitoring Form (MR-1) for the months in which tests were performed, using the
parameter code TGP3B for the pass/fail results and THP3B for the Chronic Value. Additionally,
DWQ Form AT-3 (original) is to be sent to the following address:
Attention: North Carolina Division of Water Quality
Environmental Sciences Branch
1621 Mail Service Center
Raleigh, North Carolina 27699-1621
Completed Aquatic Toxicity Test Forms shall be filed with the Environmental Sciences Branch no
later than 30 days after the end of the reporting period for which the report is made.
Test data shall be complete, accurate, include all supporting chemical/ physical measurements
and all concentration/response data, and be certified by laboratory supervisor and ORC or
approved designate signature. Total residual chlorine of the effluent toxicity sample must be
measured and reported if chlorine is employed for disinfection of the waste stream.
Should there be no discharge of flow from the facility during a month in which toxicity monitoring
is required, the permittee will complete the information located at the top of the aquatic toxicity
(AT) test form indicating the facility name, permit number, pipe number, county, and the
month/year of the report with the notation of "No Flow" in the comment area of the form. The
report shall be submitted to the Environmental Sciences Branch at the address cited above.
Should the permittee fail to monitor during a month in which toxicity monitoring is required,
monitoring will be required during the following month.
Should any test data from this monitoring requirement or tests performed by the North Carolina
Division of Water Quality indicate potential impacts to the receiving stream,,this permit may be re-
opened and modified to include alternate monitoring requirements or limits.
NOTE: Failure to achieve test conditions as specified in the cited document, such as minimum
control organism survival, minimum control organism reproduction, and appropriate
environmental controls, shall constitute an invalid test and will require immediate follow-up
testing to be completed no later than the last day of the month following the month of the initial
monitoring.
Town of Clayton
NPDES No. NCO025453

A. (7.) EFFLUENT POLLUTANT SCAN
The permittee shall perform an annual pollutant scan of its treated effluent for the following
parameters:
Ammonia (as N)
Chlorine (total residual, TRC)
Dissolved oxygen
Nitrate/Nitrite
Total Kjeldahl nitrogen
Oil and grease
Total Phosphorus
Total dissolved solids
Hardness
Antimony
Arsenic
Beryllium
Cadmium
Chromium
Copper
Lead
Mercury
Nickel
Selenium
Silver
Thallium
Zinc
Cyanide
Total phenolic compounds
Volatfle organic compounds:
Acrolein
Acrylonitrile
Benzene
Bromoform
Carbon tetrachloride
Chlorobenzene
Chlorodbromomethane
Chloroethane
2-chloroethylvinyl ether
Chloroform
Dichlorobromomethane
1,1-dichloroethane
1,2-dichloroethane
Trans-1,2-dichloroethylene
1,1-dichloroethylene
1,2-dichloropropane
1,3-dici loropropylene
Ethylbenzene
Methyl bromide
Methyl chloride
Methylene chloride
1,1,2,2-tetrachloroethane
Tetrachloroethylene
Toluene
1,1,1-tdchloroethane
1,1,2-tdchloroethane
Trichloroethylene
Vinyl chloride
Acid-expuctable compounds:
P-chloro-m-creso
2-chlorophenol
2,4-dichlorophenol
2,4-dimethylphenol
4,6-dinitro-o-cresol
2,4-dinitrophenol
2-nitrophenol
4-nitrophenol
Pentachlorophenol
Phenol
2,4,6-trichlorophenol
Buse-neut a1 compounds:
Acenaphthene
Acenaphthylene
Anthracene
Benzidine
Benzo(a)anthracene
Benzo(a)pyrene
3,4 benzofluoranthene
Benzo(ghi)perylene
Benzo(k)fluoranthene
Bis (2-chloroethoxy) methane
Bis (2-chloroethyl) ether
Bis (2-chloroisopropyl) ether
Bis (2-ethylhexyl) phthalate
4-bromophenyl phenyl ether
Butyl benzyl phthalate
2-chloronaphthalene
4-chlorophenyl phenyl ether
Chrysene
Di-n-butyl phthalate
Di-n-octyl phthalate
Dibenzo(a,h)anthracene
1,2-dichlorobenzene
1,3-dichlorobenzene
1,4-dichlorobenzene
3,3-dichlorobenzidine
Diethyl phthalate
Dimethyl phthalate
2,4-dinitrotoluene
2,6-dinitrotoluene
1, 2-diphenylhydrazine
Fluoranthene
Fluorene
Hexachlorobenzene
Hexachlorobutadiene
Hexachlorocyclo-pentadiene
Hexachloroethane
Indeno(1,2,3-cd)pyrene
Isophorone
Naphthalene
Nitrobenzene
N-nitrosodi-n-propylamine
N-nitro sodimethylamine
N-nitrosodiphenylamine
Phenanthrene
Pyrene
1,2,4-trichlorobenzene
1. The total set of samples analyzed during the current term of the permit must be representative
of seasonal variations.
2. Samples shall be collected and analyzed in accordance with analytical methods approved
under 40 CFR Part 136.
3. Unless indicated otherwise, metals must be analyzed and reported as total recoverable.
4. Test results shall be reported to the Division in DWQ Form- DMR-PPA1 or in a form approved
by the Director, within 90 days of sampling. Two copies of the report shall be submitted along
with the DMRs to the following address: Division of Water Quality, Water Quality Section,
Central Files, 1617 Mail Service Center, Raleigh, North Carolina 27699-1617.
Town of Clayton
NPDES No. NCO025453

MDT) un\tt-517
Jody L. McLeod
MAYOR
Bruce Thompson
TOWN ATTORNEY
Steve Biggs
TOWN MANAGER
n
COUNCIL MEMBERS
Bob Satterfield
Alexander R. Atchison
Alex Harding
Michael Grannis
Robert Ahlert
4d1 1 ca u4a MAYOR PRO TEM
June 8, 2006
N.C. Department of Environment J
and Natural Resources JUN 2 1 2006
1641 Mail Service Center
Raleigh, NC 27699-1641
To Whom It May Concern:
The Town of Clayton ("Clayton") recently entered into an Agreement of Purchase and Sale with
the South Granville Water And Sewer Authority ("SGWASA") pursuant to which the Town of
Clayton has agreed to buy 3,668 Lbs/Yr of total nitrogen ("TN") allocation at the Estuary from
SGWASA. SGWASA has the contractual right to acquire this allocation pursuant to a
memorandum of understanding entered into between SGWASA and the North Carolina
Department of Health and Human Services ("DHHS") and will acquire the allocation prior to it
being transferred to Clayton. DHHS had previously acquired 6,113 Lbs/Yr of TN allocation at
the estuary from Bay River Metropolitan Sewerage District. Clayton respectfully requests that
the 3,668 Lbs/Yr of TN allocation be transferred to its NPDES Permit. The Board of the South
Granville Water and Sewer Authority and the Town of Clayton Board of Commissioners have
approved this transaction and Clayton's obligation to close is not contingent on any factor other
than receipt from DENR of a draft permit and/or other written communication indicating that
DENR has tentatively determined to issue the revised NPDES Permit to the Town of Clayton
including the above -described 3,668 Lbs/Yr of TN allocation at the estuary. As a result, the
Town of Clayton respectfully requests that you initiate the necessary procedures to modify
Clayton's NPDES permit to add the above -referenced allocation.
If you have any questions, please do not hesitate to contact me.
Sincerely,
Steve Biggs
Town Manager
Town of Clayton
(a0042506.Na Pox 879 • Clayton, North Carolina 27528. Office [phone] • Fax [phone]

LAw OFFICES OF
WIWAM L HOPPER
N. KYLE HIcKs
JAMES C. WRENN, JR.
June 8, 2006
HOPPER, HICKS & WRENN, LLP
P.O. BOX 247, 111 GILLIAM STREET
OXFORD, NORTH CAROLINA 27565
N.C. Department of Environment
and Natural Resources
1641 Mail Service Center
Raleigh, NC 27699-1641
To Whom It May Concern:
I�
LJu I JUN 2 1 2006
DENR - V!AIER CU,'10
TELEPHONE [phone]
FACSIMILE 919-693-9938
The South Granville Water and Sewer Authority ("SGWASA") has agreed to sell 3,668 LbsNr of
total nitrogen ('TN") allocation at the estuary to the Town of Clayton ("Clayton"). SGWASA
obtained the right to purchase 6,113 LbsNr of TN allocation at the estuary pursuant to a
memorandum of understanding entered into between SGWASA and the North Carolina
Department of Health and Human Services ("DHHS") and will acquire the allocation from DHHS
prior to transferring the 3,668 LbsNr of TN to Clayton. SGWASA has now agreed to sell the
3,668 LbsNr of TN allocation to Clayton pursuant to the Agreement of Purchase and Sale
attached hereto and incorporated herein by reference as Exhibit A. The SGWASA Board and
the Town of Clayton Board of Commissioners have both approved the transaction and the
transaction will close upon receipt from the North Carolina Department of Environment and
Natural Resources ("DENR") of a draft permit and/or other written communication indicating
that DENR has tentatively determined to issue the revised NPDES Permit to the Town of
Clayton including the above -described 3,668 Lbs/Yr of TN allocation at the estuary.
By this letter, SGWASA verifies its contractual obligation to transfer the 3,668 Lbs/Yr of TN
allocation at the estuary to Clayton and joins with Clayton's request that Clayton's NPDES
permit be modified as described above.
Sincere
Jal es C. Wrenn, Jr.
Legal Counsel to SGWASA
JCWjr/md
IAo042508.DOC1

AGEFFIVIENT OF PURCHASE AND SALE JUN 2 1 2006 IL
�
L_ —
THIS AGREEMENT OF PURCHASE AND SALE ("Agree ent" )! is made and,?y
entered into as of the Effective Date set forth on the signature page greement, by -
and between the SOUTH GRANVILLE WATER AND SEWER AUTHORITY, a water and
sewer authority organized under and by virtue of Article 1, Chapter 162 of the North
Carolina General Statutes ("Seller") and THE TOWN OF CLAYTON, a municipal
corporation organized under and by virtue of the laws of the State of North Carolina
("Purchaser").
RECITALS
A. Seller is a party to a Memorandum of Understanding entered into by and
between Seller and the North Carolina Department of Health and Human Services
("DHHS") which gives Seller the right to assume all of DHHS's right, title and interest to
the annual mass loading limit for total nitrogen ("TN Allocation") according to the Neuse
River Basin Nutrient Sensitive Waters Management Strategy: Wastewater Discharge
Requirements adopted by the North Carolina Environmental Management Commission
("EMC") in 15A NCAC 26.0234 which DHHS acquired from the Bay River Metropolitan
Sewerage District pursuant to that certain Agreement of Purchase and Sale dated
October 31, 2003. Prior to the closing contemplated by this Agreement, the Seller shall
have exercised its option in full to purchase the above -described TN Allocation from
DHHS.
B. Seller has the option to acquire 6,113 pounds of the TN Allocation at the
Estuary (which is 12,236 pounds per year at the end of Purchaser's discharge pipe based
on the transport factor applied by the North Carolina Division of Water Quality ("DWQ"))
acquired by DHHS, intends to exercise its option prior to the closing contemplated by this
Agreement and desires to sell 3,668 pounds of said TN Allocation (Seller's "Offered TN
Allocation") (which is 7,336 pounds per year at the end of Purchaser's discharge pipe
based on the transport factor applied by DWQ).
C. Pursuant to a letter dated April 17, 2006 and sent to all members of the
Neuse River Compliance Association, Seller solicited bids for 3,668 pounds of said TN
Allocation. A copy of that letter is attached hereto and incorporated herein by reference
as Exhibit A.
D. On May 30, 2006 Steve Biggs, Town Manager of the Town of Clayton,
acting on behalf of Purchaser, sent a letter and bid sheet to Cindy Finan, Executive
Director of the Neuse River Compliance Association, placing a bid on the TN Allocation
that Seller wishes to sell. A copy of this letter is attached hereto and incorporated herein
by reference as Exhibit B. The Town of Clayton's bid was the high bid. Pursuant to the
terms of Exhibit A and Exhibit B, Seller and Purchaser agreed to work in good faith
towards the consummation of a purchase agreement.
{A0042489.DOC)
1

E. Senate Bill 981 has temporarily frozen the amount of nitrogen that can be
discharged into Falls Lake by those dischargers above the Falls Lake Dam to the levels
contained in the Seller's NPDES permits existing as of July 7, 2005. The freeze on
discharge will remain in effect pending the completion of a study of certain drinking water
supply reservoirs in the State of North Carolina, including Falls Lake, to determine
whether the reservoirs meet current water quality standards. Seller has determined that it
is unlikely that following the lake study that it will be able to use the full amount of the TN
Allocation purchased by DHHS.
F. Purchaser has determined that it is in the best interests of its rate payers to
acquire the TN Allocation offered for sale by Seller to facilitate the future expansion of its
waste water flow. Seller has determined that it no longer has a need for that portion of
the TN Allocation it has offered to sell and that it is in the best interests of its rate payers
to sell it and use the funds obtained for capital improvements and other system -related
expenses.
NOW, THEREFORE, for and in consideration of the foregoing recitals, the mutual
promises and covenants contained herein, and the earnest money referred to below, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:
• :•; •► X I A a I• •,
1.1. Purchase of Po ion of Seller's IN Allocation_ Seller hereby agrees to sell
and Purchaser agrees to purchase Seller's Offered TN Allocation, together with all
Seller's rights to and uses for said Seller's Offered TN Allocation.
2.1 Purchase Price- The Purchase Price ("Purchase Price") of the Seller's
Offered TN Allocation shall be ONE MILLION SEVEN HUNDRED NINETY NINE
THOUSAND NINE HUNDRED NINETY SEVEN AND 60/100 ($1,799,997.60) DOLLARS
which shall be payable in cash at closing on the terms set forth hereinbelow.
2.2 Reduction in Seller's Allocation_ The Purchase Price is based upon the
Seller being able to transfer to Purchaser at closing an allocation amount of 3668 Lbs/Yr
of TN at the Estuary in compliance with the requirements set out in this Agreement. In
the event Seller is unable for any reason to transfer an allocation of 3668 Lbs/Yr of TN at
the Estuary, Purchaser shall have the right, in its sole discretion, to terminate this
agreement or proceed with the purchase of such lesser number of Lbs/Yr as Seller is
then able to transfer at a Purchase Price to be calculated based on FOUR HUNDRED
NINETY AND 73/100 ($490.73) DOLLARS per pound, which Purchase Price shall be
paid in cash at closing as set forth hereinbelow.
ITk*t MIT, lei
(A0042489.DOC)
K

3.1 Eamast Monev_ Purchaser shall pay to James C. Wrenn, Jr., Attorney at
Law, Trustee, as Escrow Agent ("Escrow Agent") the sum of TEN THOUSAND AND
NO/100 ($10,000.00) DOLLARS by certified or bank check as the initial earnest money
("Initial Earnest Money") in connection with the transaction contemplated hereby, payable
within three (3) calendar days after the Effective Date.
3.2 Escrow Agent's R _soon ihiliti .s_ Escrow Agent is hereby authorized and
directed to hold all Earnest Money in said Escrow Agent's trust account at no cost to
Seller or Purchaser. The Earnest Money shall be retained or refunded, as the case may
be, in accordance with the terms of this Agreement and shall be applied as a credit to
Purchaser against the Purchase Price at Closing. The account in which the Earnest
Money is deposited shall be James C. Wrenn, Jr.'s attorney trust account and shall not
bear interest.
3.3 Escrow Agent's Liahility — Limitation_ In performing any of his duties
hereunder, Escrow Agent shall not incur any liability to anyone for any damages, losses
or expenses, except for willful default or breach of trust, and he shall accordingly not incur
any such liability with respect (a) to any action taken or omitted in good faith upon the
advise of counsel, or (b) to any action taken or omitted in reliance upon any instrument,
including any written notice or instruction provided for in this Agreement, not only as to its
due execution and the validity and effectiveness of its provisions, but also as to the truth
and accuracy of any information contained therein, which escrow Agent shall, in good
faith, believe to be genuine, to have been signed or presented by a proper person or
persons and to conform with the provisions of this Agreement. The parties hereby agree
to protect, indemnify and hold harmless Escrow Agent against any and all losses, claims,
damages, liabilities and expenses, including reasonable costs of investigation and
attorneys' fees and disbursements, which may be imposed upon Escrow Agent or
incurred by Escrow Agent in connection with his acceptance or the performance of his
duties hereunder, including any litigation arising from this Agreement or involving the
subject matter hereof (this indemnification shall survive a termination of this Agreement
and shall be a continuing obligation of Seller and Purchaser). In the event of a dispute
between any of the parties hereto sufficient in the discretion of Escrow Agent to justify his
doing so, Escrow Agent shall be entitled to tender into the registry or custody of any court
of competent jurisdiction the Earnest Money through use of such legal proceedings as it
deems appropriate, and thereupon be discharged from all further duties and liabilities
under this Agreement. Any such legal action may be brought in such court as Escrow
Agent shall determine to have jurisdiction thereof. The parties shall bear all costs and
expenses of any such legal proceedings.
4.1. Gloshq. The closing of the purchase shall occur at a location in Johnston
County, North Carolina, to be determined by the Purchaser, acting reasonably, at a time
to be designated within seven (7) calendar days following receipt from DENR pursuant to
(A0042489.DOC)
3

r
15A NCAC 2H.0107(c) of a draft permit. and/or other written communication indicating
that DENR has tentatively determined to issue the revised NPDES Permit to the Town
of Clayton including the above -described 3,668 Lbs/Yr of TN allocation at the estuary
(the "Regulatory Approval").
4.2.1 Evidence of Authority- At or prior to Closing, each party shall deliver
to the other party appropriate evidence to establish the authority of such party to enter
into and close the transaction contemplated hereby, including such documentation as
reasonably required by Purchaser to satisfy Purchaser that Seller has the legal right to
transfer said Offered TN Allocation to Purchaser (the "Legal Authorizations").
4.2.2 Payment of Pur has . Pri .e_ At Closing, Purchaser shall pay to
Seller the Purchase Price minus the Earnest Money which shall be credited to the
Purchase Price.
4.2.3 Bill of Sale and Additional Documentation Seller shall deliver to
Purchaser at Closing a Bill of Sale and the parties shall also execute and deliver at
Closing any other documents reasonably identified by Purchaser or Seller as necessary
or appropriate to complete and evidence the transaction contemplated hereby.
ARTICLE V: CONDITIONS PRFr.FDFNT TO PUIRCHASFR'S OBLIGATION TO
PURCHASF
The obligations and liabilities of Purchaser hereunder shall be in all respects
conditioned upon satisfaction of each of the following conditions precedent, the failure of
any of which, unless waived by Purchaser, shall entitle Purchaser, in addition to its other
rights and remedies provided in this Agreement, if any, to terminate this Agreement by
written notification given to Seller on or before the Closing Date and upon such
termination, Seller shall receive the Earnest Money then being held by the Escrow Agent.
5.1 Authorizations and Approvals_ The Purchaser shall have obtained the
Regulatory Approval and Purchaser shall have obtained assurances to its reasonable
satisfaction that Seller and Purchaser have the requisite legal authority to complete the
transaction contemplated herein.
5.2 No Chance in Selle_es TN Allocation_ Seller shall hold the entire Offered TN
Allocation, provided, however, that in the event the Offered TN Allocation should be at
that time fewer than 3,668 Lbs/Yr at the Estuary, Purchaser, in its sole discretion, may
close the purchase as described in Paragraph 2.2 herein.
5.3 Change in Laws- There shall have been no change in statutes or
regulations and no administrative or legal decision or opinion by any court or any
administrative agency materially affecting Purchaser's ability to acquire, hold, and use
(AO042489.DOc)
4

Seller's Offered TN Allocation for the purposes described herein, or affecting Seller's
ability to transfer Seller's Offered TN Allocation.
5.4. Accuracy of R _nr s _ntations and Warranties- All representations and
warranties made by Seller in this Agreement shall be true and accurate in all material
respects.
ARTICLE VI: REPRESENTATIONS AND WARRANTIES OF SE 1 ER
To induce Purchaser to enter into this Agreement and to purchaser the Offered TN
Allocation, Seller hereby makes the representations, warranties and covenants set forth in
this Section, upon each of which Seller acknowledges and agrees that Purchaser is
entitled to rely and has relied.
6.1 Seller has corporate power and authority to execute, deliver and
perform its obligations under this Agreement and this Agreement has been duly
authorized, executed and delivered by Seller, constitutes the valid and binding agreement
of Seller and is enforceable in accordance with its terms.
6.2 Or ion_ Seller is duly organized and validly existing under the laws of
North Carolina and in good standing.
6.3 No Default — Laws or Other Agreements. The execution and delivery of
and the performance by Seller of its obligations hereunder do not and will not contravene,
or constitute a default under, any provisions of applicable law or regulation, or any
agreement, judgment, injunction, order, decree or other instrument binding upon Seller or
result in the creation of any lien or other encumbrance on any asset of Seller.
6.4 No Adverse Leaal Proceedings; There is no action, suit or proceeding
pending or known to be threatened against or affecting Seller in any court or before any
arbitrator or before any governmental body which: (a) in any manner raises any
questions affecting the validity or enforceability of this Agreement or any other agreement
or instrument to which Seller is a party or by which it is bound and that is to be used in
connection with, or is contemplated by, this Agreement; (b) could adversely affect the
ability of Seller to perform its obligations hereunder, or under any document to be
delivered pursuant hereto; or (c) could adversely affect the Offered TN Allocation or the
use or purposes thereof. Seller has not filed a petition or an answer seeking
reorganization or an arrangement with creditors or to take advantage of any insolvency or
bankruptcy law.
To induce Seller to enter into this Agreement and to sell the Property as herein
provided, Purchaser hereby makes the representations and warranties set forth in this
Section, upon each of which Purchaser acknowledges and agrees that Seller is entitled to
(A0042489.DOC)
5

rely and has relied.
7.1 Authorify, This Agreement has been duly executed and delivered by
Purchaser, constitutes the valid and binding agreement of Purchaser and is enforceable
in accordance with its terms.
7.2 No Default — Laws or Other Agreements The execution and delivery of
and the performance by Purchaser of its obligations hereunder do not and will not
contravene, or constitute a default under, any provisions of applicable law or regulation,
or any agreement, judgment, injunction, order, decree or other instrument binding upon
Purchaser or result in the creation of any lien or other encumbrance on any asset of
Purchaser.
ARTICLE Vill: SELLER'S COVENANTS
8.1 Cooperation With Purchaser_ Seller shall cooperate with and assist, and
shall take no action that might impede, Purchaser in obtaining the Legal Authorizations
and Regulatory Approvals, provided that Seller shall not be obligated to incur any
expense in doing so.
8.2 Maintenance of TN Allocation_ Seller shall make its best effort to maintain
and avoid loss of any of Seller's Offered TN Allocation, and shall take no action that might
reduce its value. In the event Seller becomes aware of any action or event that
potentially may cause loss, totally or partially, of Offered TN Allocation, Seller shall
promptly notify Purchaser of such action or event.
' ' ' ' ' • ►Fill,
9.1 Governmental Approvals_ Purchaser shall submit its request to modify its
NPDES Permit to DENR on or before June 21, 2006 in order to obtain the Regulatory
Approval and shall use its best efforts to obtain its Legal Authorization on or before June
21, 2006. The failure of DENR, after receipt of a request from Clayton, to issue the
Regulatory Approval described in Paragraph 4.1 above shall not constitute an event of
default for either party.
ARTICLE X: REMEDIES ON DEFAULT
10.1 Default by Purchaser_ In the event of a default or other failure to perform
hereunder by Purchaser of any of the terms, conditions and provisions of this Agreement
prior to closing, Seller, upon written notice to Purchaser, may terminate this Agreement
and receive from the Escrow Agent the Earnest Money paid by Purchaser hereunder plus
any attorney fees and related costs incurred by Seller in connection with this transaction
as liquidated damages and in full and complete satisfaction of any and all claims of
damages or causes of action that Seller may have against Purchaser, the parties hereby
acknowledging that the actual damages of Seller would be difficult to ascertain.
{A0042489.DOC}
0

10.2 Default hu Seller_ In the event of a default or other failure to perform
hereunder by Seller of any of the terms, conditions and provisions of this Agreement prior
to closing, Purchaser, upon written notice to Seller, may terminate this Agreement and
receive from the Escrow Agent the Earnest Money paid by Purchaser hereunder plus any
additional costs of issuance including, but not limited to, bank fees, attorney fees and
related costs, and accrued interest as liquidated damages and in full and complete
satisfaction of any and all damages or causes of action that Purchaser may have against
Seller, the parties hereby acknowledging that the actual damages of Purchaser, other
than as set out hereinabove, would be difficult to ascertain; except that in the event Seller
sells or otherwise transfers to a person other than Purchaser all or any part of the Offered
TN Allocation during the term of this Agreement or after receiving from Purchaser notice
of intention to close under Section 4.1 herein refuses to transfer the Offered TN
Allocation to Purchaser according to the terms of Article V of this Agreement, Purchaser
may seek through a proceeding in equity specific performance of Seller's obligations
under this Agreement.
ARTICLE XI: NOTICE
Notices given pursuant to this Agreement shall be in writing, delivered in person, or
by a nationally recognized overnight delivery service — next business day delivery (e.g.
Federal Express) or mailed by registered mail, return receipt requested, postage repaid,
and shall be deemed effective upon the date received via personal delivery, certified mail
or overnight delivery service. Each party hereto may change the address to which
Notices to it should be sent by notice given to the other party as provided herein. The
addresses of the parties to which notice are to be sent shall be those set forth on the
signature page of this. Agreement.
ARTICLE XII: M1SCFL L ANFn11S
12.1 Entire Agreement This Agreement constitutes the entire agreement
between the parties hereto and it is understood and agreed that all undertakings,
negotiations, representations, promises, inducements and agreement heretofore entered
into between these parties are superseded hereby. This Agreement may not be changed
orally, but only by an agreement in writing signed by both Purchaser and Seller.
12.2 Waiver_ No waiver of any of the provisions to this Agreement shall be valid
unless in writing and signed by the party against whom it is sought to be enforced.
12.3 Assignment and Succession- The provisions of this Agreement shall inure
to the benefit of and be binding upon the parties hereto and their respective heirs,
personal representatives, successors and assigns. Closing shall not terminate the
obligations of the parties that are by their terms intended to survive closing.
{A0042489.DOC)
7

12.4 Severability_ If any article, section, phrase or portion of this Agreement is,
for any reason, held or adjudged to be invalid, illegal or unenforceable by any court of
competent jurisdiction, such article, section, phrase, or portion so adjudged will be
deemed separate, severable and independent and the remainder of this Agreement will
be and remain in full force and effect and will not be invalidated or rendered illegal or
unenforceable or otherwise affected by such adjudication, provided the basic purpose of
this Agreement and the benefits to the Parties are not substantially impaired.
12.5 Governing Law_ The provisions of this Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of North Carolina.
12.6 Co un .rda s_ This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which taken together
shall constitute one and the same instrument.
12.7 No Third Party Beneficiaries. The provisions of this Agreement pursuant
hereto shall not impart rights enforceable by any person or entity not a Party or not a
permitted successor or assignee of a Party bound to this Agreement and shall not create,
or be interpreted as creating, any standard of care, duty or liability to any person not a
Party hereto.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date of the last party to execute this Agreement as indicated by the dates
appearing next to the signatures below, which date shall be the Effective Date of this
Agreement.
PURCHASER
Town of Clayton
or
BY:
Steve Biggs
Town Manager
Date: ( . ;10 . Q�
Address:
P. O. Box 879
Clayton, North Carolina 27528
Witness:
'. /�. .� r (f✓
(A0042489.DOC)
S

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
as of the date of the last party to execute this Agreement as indicated by the dates
appearing next to the signatures below, which date shall be the Effective Date of this
Agreement.
SELLER:
South Granville Water & Sewer Authority
2 Ole
BY'
Ronald Alligood
Chairman
Date:
Notices to:
Lindsay Mize
Executive Director
211 West C. Street
Butner, North Carolina 27509
Witness:
(A0042489.DOC)