Frankford continues to discuss Mountaire settlement

Date Published: 
July 14, 2017

In August of 2016, the Town of Frankford filed an appeal to the State’s Environmental Appeals Board following the decision of Delaware Department of Natural Resources Secretary David Small to issue well permits to Mountaire Farms for its Frankford facility, where the company had traditionally used municipal water sources and was a major component of the Town’s water department budgeting.

The Town, however, subsequently moved into discussions with Mountaire, postponing any hearing. Those discussions are still going on, according to Town officials.

According to Councilman Greg Welch, Mountaire offered to pay the Town $1,000 per month for 10 years to help with the loss of revenue from the business’ reduction in Town water usage.

“I’m against the agreement as written right now,” said Welch. “I don’t believe we’re getting enough for our approval of that well.”

Councilman Marty Presley reminded those in attendance at the July council meeting this week that there has been no agreement signed or even agreed upon.

“Mountaire several months ago came to us and said, ‘In exchange for the loss of revenue from the plant… here’s the settlement agreement.’”

Presley said the state legislature had worked this session on a bill that would give municipalities the right to sign off on industrial wells within their boundaries; however, it was not passed.

“We know the state legislators have looked at this issue very carefully over the last six months and decided not to change the law. So, that’s where we are now. We don’t know what the law will be going forward. We’re hopeful that the legislature will bring it back up in the next legislature session… We’re a year away from anything possibly getting passed.”

Welch said he believed signing the agreement would grant Mountaire the well approval, and that if the Town does do that, they should get more from the business.

“Nothing has changed since 2001,” said Presley, noting that the law makes it so that a well can be drilled without a municipality’s approval but with the approval of the State.

Welch said the draft legislation offered a clarification that did not need to be passed. Presley disagreed.

“It clarified the proposed bill that was pending. It did not clarify the existing law,” Presley said.

Town Solicitor Chad Lingenfelder was not in attendance at the July 10 meeting.

Resident Jerry Smith asked what the impetuous was for Mountaire to give the Town any money.

“Why does Mountaire give money to the school systems? Why does Mountaire give money to public endeavors that they don’t have to? They’ve got a pretty good reputation,” replied Presley, noting that Smith was implying that the offered money was to buy off the Town, adding that was not the case.

Presley said the Town has done its due diligence on the issue, having spoken to the Attorney General’s Office, multiple attorneys, legislators and state agencies.

“They all tell us the same story… The law is pretty clear. The three legal authorities I’ve spoken to said we have no grounds to take this to court.”

Smith said the Town could choose to go through with the appeal. Presley countered that the Town could; however, they would be walking away from $450,000 offered by Mountaire.

Presley said DNREC saw that, with the loss of revenue from Mountaire, the Town would default on its approximately $350,000 in loans for its water system, which is why DNREC had offered loan forgiveness.

“I don’t think they’re being totally upfront with you on as to why they’re doing that,” said Smith.

“They only offered us forgiveness on the interest of the loan until we made the appeal,” added Welch.

Resident Wesley Hays asked if the Town can afford to go through the legal process.

“No,” said Presley.

Hayes recommended the Town cut its losses and take the money offered by Mountaire.

“It’s not enough to keep our water plant afloat — that’s my problem with it,” said Welch. “I’m all for moving ahead, too, but if you look at our water budget, it’s very lean… It’s not sustainable.”

“What’s of more value to you — a little in your hands or nothing?” asked Hayes.

“To me, it’s a no-brainer,” said Preseley. “I don’t see how you go to court and risk losing…”

The council, on a vote of 4-1 (Welch opposed), approved revisions to the proposed settlement agreement, which included the removal of a provision that could have allowed Mountaire to drill a replacement well in the future.

Council President Joanne Bacon said that, once the changes have been made, the proposed agreement will come back before the council for possible approval.