Hartselle Utilities settles sewer lawsuit, gets money for sewer rehab

Sep. 22—Hartselle Utilities this week settled an environmental lawsuit over its discharge of millions of gallons of sewer overflows in a package deal that also brought the utility millions of dollars to resolve the problem.

The 2020 lawsuit was filed in Morgan County Circuit Court by the Alabama Department of Environmental Management after nonprofit Tennessee Riverkeeper filed a notice of its intent to sue Hartselle Utilities in federal court. According to the ADEM complaint, HU had 137 sewer overflows totaling at least 6.7 million gallons in the previous five years. At a maximum of $25,000 per violation of its discharge permit, Hartselle Utilities could have gotten tagged with penalties of up to $4.2 million.

Instead, HU is being fined $13,500, plus an additional $5,258.88 in attorney fees payable to Riverkeeper. A consent order resolving the lawsuit was filed Tuesday.

And in a related transaction announced by state Sen. Arthur Orr, R-Decatur, last week, ADEM approved HU's application for $3.6 million in grants plus a $3.03 million low-interest loan for rehabilitation of its sewer system.

Tennessee Riverkeeper director David Whiteside said Wednesday he is relieved at the progress being made in Hartselle and also in an ongoing sewer rehabilitation project in Decatur, progress he said will improve the quality of creeks and the Tennessee River.

"After sewage pollution plaguing the South for decades, we finally have a glimmer of hope through these local projects, like in Decatur and Hartselle, and from increased funding from the federal government for infrastructure, especially maintaining our existing sewage infrastructure," Whiteside said.

Since the lawsuit was filed, HU has reported to ADEM another 26 sewer overflows totaling up to 709,950 gallons. Most have come during periods of heavy rain. The most recent reported overflows were two on March 9, when up to 20,000 gallons of untreated sewage escaped. The largest single overflow since the lawsuit was filed was March 18, 2021, when up to 250,000 gallons of untreated sewage ended up in Shoal Creek, which flows into the Tennessee River.

Representatives of Hartselle Utilities did not return calls Wednesday.

Whiteside said sewer overflows are in part a consequence of governments prioritizing the desire for new residents over the infrastructure investments needed to accommodate those residents.

"Unfortunately what makes this problem continue and get worse is oftentimes the local government is more interested in new development and adding more sewage and sewer lines into the system versus fixing the old lines and the old infrastructure," he said.

Under the settlement agreement, HU has three months to prepare an engineering report that addresses the need for changes in maintenance and operating procedures, the potential for rain water entering sewer lines and triggering overflows, and whether the wastewater treatment plant and sewer pipes need to be modified or replaced to limit future overflows.

The city then has five years to implement changes outlined in the engineering report, after input from Tennessee Riverkeeper and approval by ADEM.

Until the changes to the sewer system are made, HU must also file progress reports with ADEM every six months.

Orr said resolution of the lawsuit was a prerequisite to the funding HU received.

"ADEM wanted Hartselle Utilities to clean it up and that put (HU) on the critical needs list — that they had serious issues and it was questionable whether they had the financial resources to address it," Orr said, which meant the utility could receive the federal money with ADEM approval.

Orr said his understanding from HU is that the combined grant and loan amounts "should be enough to fix Hartselle's issue. That will get them well on their way."

The grant money approved by ADEM for Hartselle is part of about $473 million the agency is awarding for water and sewer projects this year. Most of the money is federal, with $225 million from American Rescue Plan Act funds allocated for water and sewer by the Legislature and Gov. Kay Ivey earlier this year.

"These projects are going to have a significant, positive effect on the lives of millions of Alabamians," ADEM Director Lance LeFleur said in a written statement last week. "We make no pretense that we can satisfy all the water and sewer infrastructure needs in the state of Alabama. The billions of dollars in requests we have received total several times the amount of money we have available. Projects we are not able to fund this year will be considered for funding in future years."

Lawmakers and Ivey put the $225 million in ARPA funds into three categories: $120 million for sewer systems for "emergency or high need projects"; $100 million as matching grants; and $5 million for Blackbelt sewer projects.

Separate from the COVID-related ARPA funding, ADEM is including in this year's allocations $137 million from the federal Bipartisan Infrastructure Law approved by Congress last year. The state expects a total of $765 million in water and sewer funding over five years.

Meanwhile, the state also has about $111 million in grant and loan funding available through a state revolving fund.

As of last Thursday, grants had been awarded to projects in 48 of the state's 67 counties. Awards range from less than $100,000 to $41 million for a wastewater project in Mobile.

More than $77 million in grants had been approved for Black Belt communities as of last Thursday. Those grants do not have to be repaid and in most cases do not require local matching funds. Another $45 million will be awarded to Black Belt projects later.

LeFleur last month told a panel of lawmakers that in allocating the money, ADEM is trying to balance the needs of areas with dire utility situations while also taking into account the needs of growing areas.

"We're in triage mode, trying to find the ones with the most critical need," LeFleur said.

Whiteside said the additional funding is critical, but local governments also must do a better job at recognizing the need to maintain and improve infrastructure before courting developers.

"Oftentimes there are tax breaks and subsidies given to those developers. They should not be getting those breaks. The money needs to go toward building new infrastructure," he said. "The state as a whole and local governments need to be taking this more seriously and doing a better job in treating our waste."

eric@decaturdaily.com or 256-340-2435. Twitter @DD_Fleischauer. Alabama Daily News contributed to this report.