Town Manager Cliff Ogburn will propose at the Town Council’s Tuesday meeting establishing two municipal service districts (MSDs) for the purpose of levying a higher tax rate starting in FY 2021-22 on property owners near the oceanfront to pay for the Town’s 2022 beach nourishment project.
We believe the report that Mr. Ogburn has filed in support of these two MSDs, which are defined solely by their proximity to the ocean, is inadequate to meet the standard imposed by North Carolina law for such special tax districts, the creation of which would be unconstitutional otherwise.
The law requires a showing of need, not benefit, and the Town Manager’s report contains no shoreline data supporting the need for a townwide sand fill. With the exception of the beach section south of Skyline Road, the 2022 project is specifically designed to limit future, speculative damage, not to address current need.
Although the FY 2021-22 town property tax rates will not be determined by the Town Council until springtime budget sessions, the Town Manager presented at the Council’s Jan. 19 workshop proposed increased tax rates for the two proposed MSDs. When combined, property owners in these two MSDs would pay for 75 percent of the Town’s portion of the 2022 beach nourishment bill.
Mr. Ogburn suggested a tax rate increase of 25.98 cents per $100 of value for MSD 1, which runs along the oceanfront, and 9.23 cents per $100 for MSD 2. (We refer you to Mr. Ogburn’s report in the Feb. 2 meeting packet for the precise boundaries of proposed MSD 1 and MSD 2, and to The Beacon, 1/19/21.)
For the agenda and meeting packet, see: Town of Southern Shores (southernshores-nc.gov)
(For the first time, you will need to sign into Dropbox, which is a free online service, in order to access the materials in support of the agenda items that are in blue type. Click on MSD BOUNDARIES.pdf (dropbox.com) for the MSD report.)
The cost of the 2022 project has been estimated by Mr. Ogburn at $14 to $16 million, but these figures date to 2019 and are not firm.
Dare County has pledged to contribute from its Beach Nourishment Fund, which is supported by county occupancy taxes, no more than $7 million up-front and an additional sum for debt service.
The Council’s Tuesday meeting will be held at 5:30 p.m. in the Pitts Center, with COVID-19 infection-prevention protocols in effect. As usual, you may email public comments to the Town Council at email@example.com before the meeting or appear in person to present them.
The Council also will consider Tuesday initiating the bidding process for the street-rebuilding projects on Hillcrest Drive and Sea Oats Trail that were postponed last year because of concerns over reduced revenue during the pandemic.
The Hillcrest Drive project extends from the street’s intersection with Hickory Trail north to the Southern Shores Civic Assn. tennis courts. The Sea Oats Trail project targets the section between Eleventh Avenue and Duck Road.
Those two projects combined will cost an estimated $1.42 million and will be paid equally by all Southern Shores taxpayers, not just the ones who own property on the improved streets.
The funding will come from the Town’s unassigned fund balance, which will be left with an estimated $3 million in available funds above the $3 million balance that must be maintained as a hedge against emergency expenses, according to Mr. Ogburn’s meeting report.
STATUTORY REQUIREMENTS OF MSD CREATION
North Carolina law allows a city council to define service districts in order to finance “beach erosion control and flood and hurricane protection works.” (See North Carolina General Statutes sec. 160A-536(a)(1)).
The state law authorizes a city council to define an MSD, however, only upon a finding that “a proposed district is in need of [beach erosion control, etc.] . . . to a demonstrably greater extent than the remainder of the city.” (NCGS sec. 160A-537(a)).
The city council must prepare a report that contains a map of a proposed MSD and “a statement showing that the proposed district meets the standards” set out in NCGS sec. 160A-537(a), that is, that it needs beach erosion control and hurricane protection to a demonstrably greater extent than the rest of the city. (NCGS sec. 160A-537(b)).
At no point in the report that Mr. Ogburn has prepared and included in Tuesday’s meeting packet does he substantiate a demonstrably greater need that the properties in the two proposed MSDs have now for beach nourishment. He does not because he cannot.
The 2022 townwide project is proactive and not based on current need.
Dare County Manager Bobby Outten expressly recognized the proactive nature of the Southern Shores project when he responded to a question at Duck’s January town council meeting about whether Southern Shores was really going ahead with beach nourishment. Mr. Outten administers the County’s Beach Nourishment Fund and is well aware of the parameters of the Town’s project.
As we exhaustively explained 1/26/21, long-term average erosion rates for the Southern Shores shoreline do not support the 2022 beach nourishment project. They are low and show, in fact, that the 3.7-mile-long shoreline is stable, except for the southern hot-spot section near Pelican Watch.
The short-term data that exist—largely, a comparison of Coastal Protection Engineering of North Carolina (CPE)’s measurements in 2017 with its data last year—are variable, according to the 22 stations where CPE took measurements, and are attributable to seasonal fluctuations, which are not really erosion. (See The Beacon, 1/26/21.)
Had the previous Southern Shores Town Council elected to join with the Town of Duck in the drone surveying that it contracted with CPE to do from September 2019 to September 2020, these fluctuations of erosion and accretion would be readily apparent.
But the Council rejected Duck’s offer, so we do not have data that show how storms, such as Hurricane Dorian in September 2019 and nor’easters in November 2019 and September 2020, cause both the erosion of sand, as well as the addition (accretion) of sand, on the dunes and the berm during an entire year.
(Southern Shores would have had to change the timing of its annual surveying, which would not have been difficult to do.)
Instead, all we have are measurements by CPE of shoreline and sand-volume changes taken once during a calendar year and during different months of the year: December in 2017; May in 2019; June in 2020.
For some of the 22 beach stations measured by CPE there are data from 2006 compiled by coastal engineers with the U.S. Army Corps of Engineers Field Research Facility in Duck, but they do not show significant shoreline change and sand loss.
It is well known that the beaches are at their narrowest during the wintertime and at their widest in July and August, and that measurements from different seasons are of little to no value. Apples to oranges. Even CPE admitted in its latest annual Southern Shores beach survey that measurements should be done during the same month each year.
Duck’s drone data, which we will discuss tomorrow, show pre- and post-storm conditions of that town’s beaches, extending south to Eleventh Avenue in Southern Shores.
CPE, which is performing Southern Shores’ annual surveys, could have done 12-month drone surveying, too, but the Town Council declined to pay for such detailing.
BENEFIT IS NOT NEED
The Town Manager cannot cite in his report shoreline erosion data that support the establishment of the two proposed MSDs. They do not exist. As a consequence, he focuses on the speculative benefit that these properties would enjoy.
But speculative benefit is not the determining factor for the establishment of special tax districts; need is.
For example, the Town Manager writes in his report:
“The Town Council . . . has determined that the creation of two Municipal Service Districts are necessary as those districts receive a greater benefit from the beach nourishment project than the rest of the Town . …”
Elsewhere, he similarly writes:
Proposed “District One receives the greatest benefit as it is closest to the ocean, benefits to a greater degree by ocean influence and beach access and is at greater risk of storm damage than those in District Two and the rest of the Town. District Two receives those same benefits but to a lesser extent than District One as it is set back further from the improvements, but to a greater extent than the rest of the Town.”
Always benefit, never need.
Indeed, the report specifically states that “The beach nourishment project is designed to limit damage from erosion and storms, thus protecting structures from this damage in District One and District Two.”
This statement is significant because it clearly addresses future speculative damage from erosion and storms. Southern Shores’ 2022 project is not designed to repair damage, as all of the beach nourishment projects in other Dare County towns and unincorporated areas have been, and there currently are no structures in Southern Shores that are threatened by erosion.
The report also states that the “The Town is committed to beach nourishment to maintain a wide recreation beach strand.” Whatever the Town’s commitments may be, they are not a factor in the needs assessment required for establishing a tax district that otherwise would be unconstitutional.
The new concept of “sufficient useable beach width,” introduced by the current Town Council in December 2020 in response to Seventh Avenue homeowners who complained about the width of their beach, has no basis in need.
Not only has the Town’s coastal engineering consultant failed to define what constitutes a sufficiently wide beach in Southern Shores, it has not deemed any Southern Shores beach to be insufficient in width. It has only measured shifting widths from May 2019 to June 2020, a 13-month drop in the shoreline-data bucket.
We have not seen any crowds on the Southern Shores beaches, which might suggest an insufficient beach width, and we have not heard any complaints about the beaches being too narrow, except from the Seventh Avenue complainers, and in 2016-17, from Pelican Watch homeowners.
CPE’s decision in its beach-width report of January 2020 to consider the width of Kitty Hawk’s and Kill Devil Hills’ beaches, which are much more congested than Southern Shores’ beaches because of the much denser development in those towns, is arbitrary and without apparent reason. More apples and oranges.
CPE has consistently reported that the area of the Southern Shores shoreline that includes Seventh Avenue has ample sand in its beach profile. (See The Beacon, 1/26/21, for details about the profile and other “How the Beach Works 101” facts.)
The Beacon finds Mr. Ogburn’s report to be inadequate to meet the N.C. statutory standard required to establish MSDs. The decision to define MSDs and to perform an exorbitant beach nourishment project—which will have to be “maintained” every five years—should be based on actual need, not on speculative benefit. We would have no objection if it were, but the data are not there.
As a postscript, we note that properties on the east side of Ocean Boulevard between the Duck Road split and Hickory Trail that do not abut the ocean are included in the Town Manager’s proposed MSD 1, not in proposed MSD 2, as Councilman Matt Neal suggested putting them at the Jan. 19 workshop.
Ann G. Sjoerdsma, 1/31/21