FAYETTEVILLE -- The three commissioners overseeing Valley View subdivision's sewer system resigned Thursday afternoon and a receiver has been appointed to take possession of the system and bring it into compliance with state laws and regulations.
Joe Stewart, Jennifer Stewart and John Lipsmeyer served on the Board of Commissioners for Washington County Property Owners Improvement District No. 5, which provides sewer service to residents of Valley View Estates subdivision through a nonmunicipal domestic wastewater treatment system.
Through their attorneys, Don Kendall and Susan Kendall of Rogers, the three commissioners resigned in Washington County Circuit Court, effective immediately.
Valley View Golf LLC, which managed the sewer system for the District, agreed to a receiver being appointed to take over the system.
The actions took place Thursday as part of a lawsuit filed in March by Washington County, the cities of Farmington and Prairie Grove, Rausch Coleman Valley View and Valley View Estates Subdivision Property Owners Association against the Improvement District, Valley View Golf LLC and the district's three commissioners.
The Kendalls represent Valley View Golf and the commissioners as individuals. They did not represent the Improvement District.
"On behalf of the three commissioners, I tender their resignations, effectively immediately, as commissioners of the District," Susan Kendall told Circuit Judge John Threet.
Kendall said the defendants "Disputed factual allegations found in the complaint but in an effort to move forward agreed to consent to a receiver being appointed."
Susan Kendall told Threet that the defendants agreed to cooperate fully with a receiver.
Threet accepted all three of Kendall's motions.
Friday, Don Kendall said, the defendants decided they would not oppose receivership. Once that decision was made, Kendall said, it appeared the best thing to do would be for the three commissioners to resign.
The county's lawsuit petitioned the court to issue a temporary restraining order against the district, to approve temporary and permanent injunctions and to appoint a receiver to take over the system.
The suit also asked that the commissioner offices be declared vacant and that the contract between the District and Valley View Golf for sewer services be declared null and void. No action was taken on these in court last week.
Complaints from residents about the sewer system go back to 2011 on the Arkansas Department of Environmental Quality's website, with numerous state inspections on the website showing signs that untreated wastewater had overflowed from the system's aerator holding pond on many occasions.
The county's suit asked that the system be placed under a receivership because of the danger of harm to the health and safety of residents in the subdivision and the danger to the environment as a whole.
Threet issued a temporary restraining order against the Improvement District on April 11 and appointed Jerry Kopke of Communities Unlimited as the receiver for the sewer system. Threet scheduled a final hearing on the restraining order and receivership for April 21.
The hearing was supposed to start at 1:30 p.m., but attorneys and others involved met in conference prior to the hearing. Everyone filed into the courtroom about 2:10 p.m. and the resolution was publicly presented to Threet.
Threet also granted a request from Susan Kendall to allow an additional 30 days for the defendants to file a formal response to the county's complaint.
Steve Zega, Washington County attorney, asked the court to substitute Communities Unlimited as the receiver, instead of naming Jerry Kopke individually. Communities Unlimited will post a $10,000 bond and must submit its first report within 90 days. The court authorized Communities Unlimited to employ engineers and other professionals as needed for the sewer system.
Afterward, Zega said that he believes the resolution was a "good response for the folks at Valley View and in the county's and cities' best interest. We think the number one issue has been resolved today and that's a change in leadership."
Kopke said the firm's first order of business as receiver will be to view the physical plant with representatives of ADEQ, look at the system and view ADEQ inspection reports.
He said Communities Unlimited will mail notices to all customers of the sewer system about the receivership and he will advise them not to make sewer payments to Valley View Golf. Kopke said he is talking to Washington Water Authority to arrange for sewer bills to be mailed out along with water bills.
Kopke also said he will be requesting that Joe Stewart provide all reports and financial information from the Improvement District to Communities Unlimited.
The firm's first priority, Kopke said, is to residents of Valley View Estates and customers of the sewer system. He said he will make sure residents stay informed, either through meetings or mailouts.
Kopke said he also will be working with ADEQ to resolve ongoing issues between the Improvement District and the state agency.
An ADEQ lawsuit is pending in Circuit Court against the Improvement District. This 16-page complaint seeks $420,000 in civil penalties and asks the court to require the Improvement District to meet the terms of an emergency order issued in April 2015, to require remedial measures for wastewater overflows and to seek enforcement of a Consent Administrative Order.
"There's a lot to fix and it will be fixed as soon as possible," Kopke said.
Kopke did not know how long the temporary receivership would last, saying it could be six to 12 months. When his work is finished, the receivership will be dissolved and the sewer system returned to Washington County Property Owner Improvement District No. 5, with new commissioners appointed.
William Stephenson, president of Valley View Estate Subdivision Property Owners Association, attended the hearing on behalf of residents.
"I think it will be a positive move to get our sewer system working properly," Stephenson said.
The Kendalls on Thursday filed a response on behalf of the defendants to the court's April 11 decision in which Threet approved a temporary restraining order and appointment of a receiver. In their response, the defendants denied all allegations and claimed that the appointment of a receiver would slow down the progress being made in the ADEQ lawsuit filed against the Improvement District.
The response claims that allegations of raw sewage flowing into Farmington's storm water drains are false, based on a report filed by ADEQ's water division. This report, attached to the defendants' response, states that samples taken from certain places on the golf course were within acceptable limits.
Don Kendall said media coverage of ongoing issues with the sewer system has made it appear the treatment facility is a part of the Valley View golf course.
The two are separate entities and the treatment facility is located on private land, Kendall said, not land owned by the golf course.
He said he will file a separate answer to the county's lawsuit, but that the response filed Thursday basically sets forth the defendants' position in the matter.
General News on 04/27/2016