High EDU Costs Limiting Route 50 Development Options

SNOW HILL — While it remains largely uncertain what commercial interests will fill in the areas around the growing Wal-Mart and Home Depot complex on Route 50, it now appears the exorbitant cost of sewer service could be curtailing the growth process.

In 2013, Worcester County entered an agreement with the GlenRiddle developer to build the Riddle Farm Wastewater Treatment Plant sewer infrastructure needed to support anticipated commercial growth in the area. In essence, the developer agreed to absorb the cost of expanding the plant in exchange for the rights to sell the commercial equivalent dwelling units (EDUs) to prospective developers.

The concept was the county would get the public sewer service it needed to support the expansion of the Ocean Landings commercial complex and other areas, while the Riddle Farm developer would get the opportunity to sell the EDUs. In this case, the agreement stated the developer could sell as many as 247 available EDUs at a cost of $23,535 each.

However, an unintended consequence has been the cost per EDU has had a detrimental effect on the commercial growth in the area, according to Worcester County Economic Development Director Bill Badger.

“This public-private partnership gave the county the opportunity to avoid taxpayer dollars being spent on the sewer infrastructure, but it also resulted in expensive EDU sewer costs,” Badger told the commissioners on Tuesday. “These costs have discouraged development activity in the county’s planned growth area.”

Badger mentioned specifically a handful of businesses considering the area were put off by the expensive EDU cost.

“We got some feedback from the development community that the EDU costs could be detrimental to their decision to move to Worcester County,” he said. “Among those that raised concerns were the Texas Roadhouse and the Cracker Barrel.”

Last year, the county contracted the private consulting firm MuniCap Inc. to conduct a review of the Riddle Farm wastewater treatment plant as it relates to the cost of the EDUs. MuniCap completed its initial work and offered a variety of solutions to address the issue, according to Badger.

“There are basically three options,” he said. “One is doing nothing, two is deferring some of the cost to get the EDU price down around a more acceptable $18,000, and three is creating a special taxing district in those areas to help offset the cost. My advice is completing the second phase of the study, which will cost around $20,000.”

The commissioners agreed to fund the second phase, if only to get a better handle on why some developers are avoiding the high EDU cost.

“The rewards outweigh the costs,” said Commissioner Bud Church. “Let’s get a professional in here to figure out how to solve our problem.”

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