Gov. Nathan Deal made encouraging the development of new regional reservoirs a hallmark of his first legislation season, but his successes in that arena already are causing some to worry about who is behind these new projects.
Among Deal's early successes is Senate Bill 122, which paves the way for local governments to partner with private developers to build new reservoirs. The governor also has included $46 million in his initial budget to help with planning and permitting costs of the massively expensive projects, and his water supply task force is working out a selection process on which new projects to nurture with state funds and expertise.
Joe Cook, executive director of the Coosa River Basin Initiative, said one of the dangers to the state's approach to water is that it will encourage speculators to come up with expensive and environmentally destructive reservoir projects. The developers then pitch those projects to local governments that have access to the new state money and the power to condemn property, he said.
"As a state, we've invested millions over the past 10 years in planning for water supply, and that’s been a very public process," he said. "Now, all of the sudden, we are injecting influence from the private sector. ... We could see water supply projects driven not by actual need but by the private sector, whose primary goal is to turn a profit."
One project on Cook's radar is a proposed reservoir near Dahlonega. Rep. Amos Amerson, R-Dahlonega, has heard of the project, too.
Amerson said several constituents have claimed they are being pressured to sell their property to a private developer for a proposed reservoir project on Calhoun Creek, a feeder stream of the Etowah River near the Dawson-Lumpkin county line. Last week, Amerson took his concerns to the House floor as he spoke against SB 122.
Lawmakers were told SB 122 would allow local governments the chance to identify a project and then select a private company to invest in it. The Calhoun Creek project appears to be working in the opposite fashion, with a private speculator developing a project and then searching for a local government partner with the needed legal authority and access to state money.
"It opens things up to a lot of abuse," Amerson said.
Beatrice “Dixie” McMahan of Gainesville shares a 40-acre plot of family land along Calhoun Creek with her daughter, two sisters and nieces. All of them have already been approached with offers to buy their land, she said.
“My sister contacted me and said she had been approached by a real estate man wanting to buy their property," she said. “The next day, I got a phone call from the real estate company, and they wanted to purchase our property. They made me an offer.”
McMahan said the agent intimated she had little choice in the matter.
“She said, ‘Let me tell you something, if you don’t take my offer -- if eminent domain is declared, you may only get 80 percent of this,'” she said.
Tony Nunley, owner of Chestatee Real Estate, said his firm has been hired by the Georgia Reservoir Co. to line up the land necessary for the proposed reservoir. But he said his agents do not bring up the possibility that a local government partner would take the land if they refuse to sell.
Nunley said the property owner usually asks the question, however.
“We always suggest they seek an attorney," he said.
Incorporation records show Dahlonega resident John McGrew Jr. set up the Georgia Reservoir Co. and the Lumpkin Timber Co. last year. He could not be reached for comment, and Nunley said McGrew had asked that his number not be given to the media.
The project's target customer for the reservoir is Forsyth County, which like most North Georgia governments is actively seeking new water sources for anticipated population growth.
Forsyth County spokeswoman Jodi Gardner said county officials have held "very preliminary" talks with McGrew, although she said she did not know who met with the developer or what the talks entailed.
A December presentation of water development options by a consulting firm before the Forsyth County Board of Commissioners did include an unnamed "Etowah Basin Reservoir" that Gardner said was the McGrew plan.
Deal said SB 122 provides another avenue for local government to pursue to help get water projects off the drawing board.
“We believe we have to have as many tools in our box as possible to deal with this issue,” he said. “We simply want to be a partner in this process.”
Deal said ideally such projects would be hatched by local governments.
"They know best what their interests are," he said. But, he added, “That’s not to say it can’t work the other way.”
Senate Natural Resources Committee Chairman Ross Tolleson, who sponsored the legislation, said the bill specifically was crafted to give local governments the utmost control over projects while providing them with a way to pay for them.
It is only fair given the situation many communities face when it comes to water supply, he said.
“What we’ve set in motion is a lot of things that are going to cost a lot of money over the next 25 years," he said.
Tolleson said he thinks the chances that local governments could be duped by private speculators is remote.
"It’s something I will watch very closely," he said. “You have to have some belief in local government. That’s where you get hired and fired real quick.”
Cook said the best-case scenario is that the interest in water development will give local governments the chance to pick and choose the best and least costly water projects. Then the state would step in with financial help planning and permitting those projects.
But the Calhoun Creek project already has him concerned.
"My fear is you are going to see projects that are not needed because you have politically connected individuals that are courting state dollars,” he said.
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