SALISBURY – Officials in Wicomico County are taking initial steps to hold an informational meeting for Village Down River property owners after discovering the community’s developer failed to set aside funds for the maintenance of a shared sewer system, a responsibility that will be left to its residents if the developer succeeds in transferring ownership.
In an Urban Services Commission meeting last week, Weston Young, assistant director of administration, and Paul Wilber, Wicomico County’s attorney, met with the Wicomico County Council to discuss how they would recover the funds and inform community members of the issue at hand.
Young explained that Wicomico County, the Urban Services Commission and Village Down River developer Terra Firma, LLC entered into a Shared Facility Agreement in 2008 that outlined the operational and financial obligations for a community sewer system.
“It was determined that a shared facility agreement was deemed necessary for this community sewer system to ensure efficient, affective maintenance, operation and to handle the continuous preventative and corrective maintenance of the sewer system,” he said.
As part of the agreement, Young said Terra Firma was required to place money into an escrow account that would fund emergencies, maintenance and replacements in the event of a system failure. In 2008, these initial sums included $56,250 for the emergency fund and $48,000 for an operation and maintenance fund.
“It was determined last year by the finance department that this agreement had never been met and these funds were never received,” he said.
According to Young, the county’s public works department reached out to Terra Firma regarding their financial obligations late last year.
In an email exchange, Young said the developer referenced the company’s compliance with the Maryland Department of the Environment and the county’s silence on the facility’s operation. He said the county also discovered the developer is seeking to transfer ownership to the community’s association sometime this year.
Young explained that if this were to happen, the owners would have no financial security to maintain the sewage system.
“If something were to fail, there are no reserves currently to fix it, and you have 49 single family units that would not have sewer capability,” he said. “That’s a potentially serious issue.”
Young explained that it is the intention to seek legal action to collect the funds, but Wilber first recommended sending a letter to owners regarding the Shared Facilities Agreement and an explanation of the current situation.
“He still owns about half of the lots, but he wishes to convey part of the responsibility and that’s why I think the property owners out there need to know what is happening,” he said. “I think that will produce some activity.”
At the suggestion of Councilman Joe Holloway, Wilber and Young agreed to a community meeting that will address questions and concerns lot owners may have.
“I think some outreach needs to be done,” Holloway said, “other than just a letter.”
Although there was no clear explanation as to why the county failed to collect the funds, Cannon agreed that there was a breakdown in communication.
“Somebody dropped the ball,” he said.
Nonetheless, he and other councilmembers voiced their desires to stop a transfer from occurring.
“Once this goes to the homeowners, we are going to be very limited on what we can do,” Cannon said. “That is why it’s important that we keep this from being transferred to the homeowners.”
Wilber agreed to pursue any actions that would fund the escrow accounts, but Cannon stressed that any legal action be directed toward the developer.
“Our agreement was never with the individual lot owners,” he said. Our agreement was only with Terra Firma.”
Holloway said the situation was a warning to the council about agreements that were made between the county and other entities.
“If there was a failure there and there wasn’t money to fix the problem, they’ll be looking to the county to fix the problem,” he said. “That’s for sure.”
The councilmembers unanimously agreed to file a complaint for declaratory judgment and requested a letter be drafted that would establish a community meeting.
Cannon tasked Young with finding information on the condition of the sewer system and where the community’s service fees are currently going before the meeting takes place.
“I think these preparations are necessary to have a meeting,” Cannon said.