SW8060637_NOD_20190816

ROY COOPER
Governor
MICHAEL S. REGAN
Secretary
S. DANIEL SMITH
Director
August 16, 2019
NORTH CAROLINA
Environmental QuaAty
RFGF!VFD
Castlelake II GP, LP, Manager of
RED Funding Solutions III, LLC AUG 23 2019
Attn: Kelly Lettmann
4600 Wells Fargo Center DENR-LAND QUALITY
90 South 7th Street 3TORMWATER PERMITTING
Minneapolis, MN 55402
Subject: NOTICE OF DEFICIENCY #NOD-2019-PC-0182
Richmond Hills Subdivision
State Stormwater Management Permit No. SW8 060637
Brunswick County
Dear Kelly Lettmann:
On February 20, 2018, the Division of Energy, Mineral and Land Resources (DEMLR) inspected the
subject project to determine the status of compliance with the State Stormwater Management
Permit Number SW8 060637 which was transferred and reissued to REO Funding Solutions III, LLC
on August 6, 2014. The inspection was initiated after DEMLR received a complaint of flooding from
an adjacent property owner behind the Pond #1 common area. Since then, the Division has
identified 2 additional deficiencies: a complaint from a resident about sinkholes that have formed in
the street adjacent to the grated curb inlet structures that pick up and convey runoff to the
permitted ponds; and, the sale of a portion of the permitted project area without prior approval
from the Division.
The file review and site inspection revealed that the project is currently not in compliance with the
terms and conditions of this permit. A copy of the completed form entitled "Compliance Inspection
Report" was sent to you at the address above on February 22, 2018, but we have received no
response to that letter.
As indicated in the February 20, 2018 inspection report, the following deficiencies must be
resolved:
1. A signed engineer's certification must be submitted for all three permitted wet detention ponds.
2. All ponds have dead grass and weeds, woody and/or clumping vegetation around and on the
slopes. Permanent vegetation is required for all ponds.
3. The forebay depths in all ponds need to be checked to determine if the sediment has
accumulated beyond the permitted levels and needs to be removed.
4. The drawdown orifice in all of the ponds needs to be unclogged.
S. Please verify that the design depth and orifice elevation and size for each pond is in accordance
with the approved plans.
6. Please ensure that the runoff collection system is maintained in a manner that will adequately
convey the first flush design storm to the permitted stormwater control measure to be treated.
If there are any swales, catch basins or pipes exhibit signs that sediment has accumulated to the
point that the runoff is not able to drain to the pond, or if any leaks have developed which allow
the runoff to escape untreated, then the Division requires permanent repairs to be made and
the system restored to design condition.
D_E QJ� North Carolina Department of Environmental Quality I Division of Energy. Mineral and Land Resources
Wilmington Regional Office 1 127 Cardinal Drive Extension I Wilmington. North Carolina 28405
ncr+r rsxcurw
910.796.7215

State Stormwater Permit No. SW8 060637
Page 2 of 3
7. A portion of the project area was sold to Miramar Richmond Hills, LLC on April 23, 2019. As per
Schedule of Compliance II.6 of the permit, the sale of all or part of the permitted project area
requires approval from the Division. To date, REO Funding Solutions III, LLC has not notified the
Division of the sale, nor received approval from the Division. In addition, Miramar Richmond
Hills, LLC, has not applied for a stormwater permit to develop this section of Richmond Hills.
8. For Pond #1, the following additional deficiencies were observed:
a. The weir opening in the forebay needs to be relocated to the street side, as shown on
the approved plan. The current location creates a short-circuiting condition in the pond
that is in violation of the permit.
b. Per the approved plan, the pond outlets into a low area located on adjacent property
owned by Barbara Hewett. There are no drainage easements shown on any of the
recorded plats for Richmond Hills or Ms. Hewett's property. A small ditch has been dug
along the common property line, but it is unknown if this ditch is located on Richmond
Hill property or on Hewett property or if there is a drainage easement for this ditch. The
permittee is responsible for obtaining all necessary drainage easements to effectuate
the approved plans.
9. For Pond #2, the following additional deficiencies were observed:
a. The forebay berm does not appear to be as long as is shown on the approved plans.
b. The pond slopes are eroding and sloughing.
Please note that the permit will expire in August of next year, and that a renewal application and fee
must be submitted to the Division by February 2020, which is not far off.
Please be reminded that it is your responsibility as the permittee of record to submit a completed
and signed Permit Transfer Application Form to the Division of Energy, Mineral and Land
Resources 60 calendar days prior to making any of the below listed changes. This form is available
on our website at: https:lldegnc.gov./aboutIdivisions./energy-mineral-land-resources energy-
mineral-land-rules/stormwater-program/post-construction.
a. An ownership change including the sale or conveyance of the permitted project area in
whole or in part. This does not include the conveyance of a subdivided residential lot to an
individual which are made subject to a recorded declaration of covenants and restrictions
which contain the statements required by the stormwater permit.
b. The sale or conveyance of the common areas to a Homeowner's or Property Owner's
Association, subject to the requirements of Session Law 2011-256;
c. Foreclosure proceedings;
d. Filing for Bankruptcy;
e. Dissolution of the partnership or corporate entity. Per NCGS 57D-6-07, a dissolved LLC
shall wind up, which may include continuing the business of the LLC for a period of time.
The person charged with winding up the LLC shall collect the LLC's assets [which include
the stormwater management permit], and distribute the assets as provided in NCGS 57D-
6-08(2).
f. A name change of the owner / permittee;
g. A name change of the project;
h. A mailing address change of the permittee;
Please also be advised that until you submit the required Permit Transfer Application Form to the
Division and receive approval from the Division to transfer the permit, you are required to comply
with the terms, conditions and limitations of the Stormwater Management Permit under Title 15A
North Carolina Administrative Code 2H .1003 and North Carolina General Statute 143-214.7,
including the operation and maintenance of the permitted stormwater system.

State Stormwater Permit No. SW8 060637
Page 3 of 3
As the permittee of record, RED Funding Solutions III, LLC must ensure that there is a plan in place
to address common expenses associated with maintenance of the permitted stormwater control
measure(s) that treats runoff from the BUA within that portion of the tract that was sold to
Miramar Richmond Hills, LLC, and you must provide oversight of the builders to ensure that they
are building within the BUA limits on the lots they own. It maybe prudent to submit an application
to modify the SW8 060637 permit and remove the Phase 2 development area and require Miramar
Richmond Hills, LLC to obtain a new permit to develop Phase 2. As it stands now REO Funding
Solutions III, LLC remains responsible for complying with the permit, including the development of
Phase 2, which is now owned by Miramar Richmond Hills, LLC who does not hold a permit to
develop. In addition, Miramar Richmond Hills, LLC is not registered with the NC Secretary of State.
If they intend to develop this portion of Richmond Hills, and receive a permit, they must register
with the NCSOS.
Please inform this Office in writing before September 16. 2019, of the specific actions that will be
undertaken and the time frame that will be required to correct the deficiencies. Failure to provide
the requested information, or to respond to this letter with a plan of action, including a timeline to
resolve the identified deficiencies, by the due date, are considered violations of the permit. If the
requested information is not submitted to this office by the due date, then DEMLR staff will re-
inspect the site and may issue a Notice of Violation. Please also note that any individual or entity
found to be in noncompliance with the provisions of a stormwater management permit or the
stormwater rules is subject to enforcement action as set forth in NCGS 143 Article 21, including the
assessment of civil penalties of up to $2S,000 per day.
If you have any questions, please don't hesitate to contact Linda Lewis in the Wilmington Regional
Office, telephone number [phone] or via email at linda.lewisPncdenr.gov.
Sinceyely,
F� S. Daniel Smith, Director
Division of Energy, Mineral and Land Resources
Eric: Compliance Inspection Report
GDS\arl: G:\\\Stormwater\Permits & Projects\2006\060637 HD\ 2019 NOD 060637
cc: Phil Norris, P.E., Norris & Tunstall Engineers
Miramar Richmond Hills, LLC
Alaina Morman, DEMLR
WiRO Stormwater File

Compliance Inspection Report
Petflit: • S+N8060637 Effective:08106/14 Expiration: 08/17/20
Project: Richmond Hill Subdivision
Owner: Reo Funding Solutions III LLC
County: Brunswick Adress: NC 211
Region: Wilmington
City/StatelZip: Supply NC 28462
Contact Person: Julie K Braun Title: VP
Directions to Project:
From US 17 adb NC 211, north on 211. Site is 1/4 mile on left.
Type of Project: State Stormwater - HD - Detention Pond
Drain Areas: 1 - (Lockwoods Folly River) (03-07-59 ) ( C;Sw)
2 - (Lockwoods Folly River) (03-07-59 ) ( C;Sw)
3 - (Lockwoods Folly River) (03-07-59 ) ( C;Sw)
On -Site Representative(s):
Related Permits:
Inspection Date: 0212012018 Entry Time: 02:30PIA
Primary Inspector: Alida R Lewis`lilt
Secondary Inspector(s): 1.
Reason for Inspection: Follow-up
Permit Inspection Type: State Stormwater
Facility Status: ❑ Compliant ® Not Compliant
Question Areas:
® State Stormwater
(See attachment summary)
tlcQ- 20/9— P6-- 0/�2
Phone: [phone]
Exit Time: 03:OOPIJI
Phone: [phone]
Inspection Type: Compliance Evaluation
page: 1

Permit: SW8060637 Owner - Project: Reo Fundino SoWlions il; PLC
Inspection Date: 0212012018 Inspection Type Compliance Evalualion Reason for Visit: Follow-up
Inspection Summary:
The project was inspected after receiving a complaint about flooding from an adjacent property owner to Pond #1. The
inspection revealed the following deficiencies:
1. Engineer's certifications need to be submitted for each pond.
2. Eroded areas of all of the pond slopes need to be repaired.
3. Permanent vegetation needs to be established on all of the pond slopes.
4. Any accumulated sediment in each pond and forebay needs to be removed.
5. The orifice in each pond needs to be unclogged.
6. The weir opening in the forebay berm of Pond #1 needs to be relocated to avoid short-circuiting
7. A drainage easement needs to be in place at the outlet of Pond #1.
8. The forebay berm in Pond #2 needs to lengthened.
page: 2

Permit: SW8060637 Owner - Project: Reo Funding Solutions III LLC
Inspection Date: 02/20/2018 Inspection Type Compliance Evaluation Reason for Visit: Follow-up
File Review Yes No NA NE
Is the permit active? ®1:1❑
Signed copy of the Engineer's certification is in the file?
Signed copy of the Operation & Maintenance Agreement is in the file?
Copy of the recorded deed restrictions is in the file?
Comment., 1 The Engineer Certifications for the 3 permitted ponds have not been submitted.
Built Upon Area
Is the site BUA constructed as per the permit and approval plans?
Is the drainage area as per the permit and approved plans?
Is the BUA (as permitted) graded such that the runoff drains to the system?
Comment.
SW Measures
Are the SW measures constructed as per the approved plans?
Are the inlets located per the approved plans?
■ ■ ■
Yes No NA NE
N❑❑❑
19 ❑ ❑ ❑
0 ❑ ❑ ❑
Yes No NA NE
Are the outlet structures located per the approved plans? ® ❑ ❑ ❑
Comment. 2 The forebay weir opening in Pond #1 is located at the wrong end of the berm separating the forebay
from the main pond The opening is supposed to be located at the end of the berm closest to the street.__
The current location is closer to the outlet structure which causes short-circuiting in the pond
3 The forebay berm in Pond #2 does not appear to be as long as it is shown on the approved plans.
Operation and Maintenance Yes No NA NE
Are the SW measures being maintained and operated as per the permit requirements? ❑ 9 ❑ ❑
Are the SW BMP inspection and maintenance records complete and available for review or provided to ❑ ❑ ❑1100
DWQ upon request?
Comment: 4 The slopes of and the area around all three ponds is covered with dead grass, weeds and woody or
clumping vegetation causing erosion Please repair all eroded areas and provide permanent vegetation
for all pond slopes.
5 Please check all forebays and the main pond for sediment accumulation and remove as needed.
6. Please check and unclog the orifice in each pond_ The water level in each pond was within 6-8 inches
of overtopping the outlet structure According to the permit there should be 3 feet of elevation difference
between the permanent pool elevation and the top of the outlet structure in Ponds 41 and #2 and there
should be 1.5 feet of elevation difference between the permanent pool elevation and the top of the outlet
structure in Pond #3
7. Please verify the invert elevation for each orifice and the design depth for the pond.
Other Permit Conditions
Yes No NA NE
page: 3

Permit: SW8060637 owner • Project: Reo Funding Solutions III LLC
Inspection Date: 02/20/2018 Inspection Type Compliance Evaluation Reason for Visit: Follow-up
Is the site compliant with other conditions of the permit? 11 _ r, ❑
Comment: 8. Please ensure that the necessary drainage easements have been secured and show them on the
recorded plats.
9 Please remember to transfer the hermit to the HOA at the appropriate time when >50 % ofthe lots
are sold to individuals (not builders), the common areas have been conveyed to the HOA. and the
proiect has been determined to be in compliance by the Division._
page: 4