Judge issues permanent injunction after ‘unlawful’ transfer of H2GO assets

Judge issues permanent injunction after ‘unlawful’ transfer of H2GO assets
GF Default - Judge to issue permanent injunction connected to "unlawful" transfer of H2GO assets.

BRUNSWICK COUNTY, N.C. (WECT) - The judge handling the contentious legal battle between the Brunswick Regional Water and Sewer Authority H2GO, the Town of Leland and the Town of Belville has made a decision regarding what he deemed an unlawful transfer of assets from H2GO to the Town of Belville in 2017.

In a court order signed on July 12, Judge Charles Henry entered a permanent injunction, which would essentially force Belville to return the water and sewer authority’s assets to H2GO. However, his permanent injunction will not take effect immediately.

“The court, in exercise of its discretion, has decided to stay and suspend the permanent injunction granted herein while any appeals....are pending...,” Henry wrote in his order, allowing Belville to continue its appeal before they are forced to return H2GO’s assets.

So essentially, the status quo will not change, and the initial preliminary injunction will remain in effect. If Belville continues its appeal, they would retain technical title to the assets for the time being, but would be prohibited from using them. If they lose their appeal, Belville would be forced to give the assets back to H2GO.

Mayor Mike Allen was recently recorded telling voters that the appeals process would go on until well after the November election, and that if the right people were voted onto the H2GO board, he would return the assets tomorrow. Edes called that an “outrageous abuse of the appeals process.”

“I am encouraged by the judge’s decision” H2GO Board Chairman Jeff Gerken said. "The decision clearly supports the conclusion that the Beville transaction was illegal, null and void.”

In 2017, the outgoing H2GO Board of Commissioners voted to transfer $56 million of H2GO assets to Belville in a last ditch effort to save a controversial reverse osmosis plant. Voters, some of whom thought the reverse osmosis plant was unnecessary and expensive, had voted in a new board of commissioners opposed to the plant. The vote to transfer assets for a mere $10 to Belville came before the new H2GO board had been sworn in.

For the last two years, H2GO has been in a legal battle with Belville to regain control of the assets. Gerken said the net effect has been denying the current board the right to properly govern as they were elected to do by voters.

“One has to wonder how long the citizens of Belville will be willing to continue to bankroll the attorneys, who have been the real winners in the case up to this point,” Gerken added.

Beville Mayor Mike Allen received a signed copy of the judge’s order Friday afternoon.

“We will abide by what the court has to say,” he said. “We appreciate the judge giving us the stay and allowing us to go through the appeals process. This is an election cycle for H2GO, so that might lead to some new dynamics.”

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