Deborah Hilliard listens as her husband, Jimmy Hilliard, discusses the ongoing troubles of Lewis County Water Sewer District 5, the public utilities district that serves Birchfield, in this 2013 Chronicle file photo.
In this 2013 file photo, real estate developer Virgil Fox stands in the pumphouse of Lewis County Water Sewer District 5, a public utilities district that serves the Onalaska community of Birchfield and that is nearly $500,000 in debt. Fox has devoted more than 20 years to creating Birchfield, which, he hoped, would hold 2,700 homes.
The old adage has never been truer than in Birchfield’s Water Sewer District No. 5 where, with 11 ballots processed, every vote counts.
At stake in this race: the right to govern a utility district rife with debt and questionable ethics.
Currently, three residents of Birchfield, the Onalaska housing development served by District 5, trail three of the District’s administrators in the fight for district commission seats.
If the current voting pattern continues, it will be an all or nothing outcome: Each of the residents lags behind each of the administrators five to six, according to unofficial results from the Lewis County Auditor’s Office.
Birchfield resident Deborah Hilliard faces District 5 Clerk Kristine Carter for Position 1. District clerk is a paid position.
Resident Rick Toups faces Birchfield housing development co-owner Carol Fox for Position 2.
And, in a match that pits the leaders of the two factions, resident and retired DEA agent Jimmy Hilliard faces District 5 Operations Manager and Birchfield co-owner Virgil Fox.
If Carter, Carol and Fox win, each will hold multiple roles with conflicting interests — a serious blow to accountability in the district. All three ran as write-in candidates.
Fox and Carol own the 1,300 acres off Middle Fork road that comprise Birchfield.
Fifteen years ago, the Foxes began the process of transforming their land into a fully contained community of high-quality family homes that would be served by Water Sewer District 5. The only residents of Birchfield at the time, Fox and Carol appointed themselves commissioners of the water sewer district.
County regulations and a stagnant economy stalled progress at Birchfield.
Today, there are only a sprinkling of occupied homes in the community intended to house 2,700 residences. Water Sewer District 5 is approximately $500,000 in debt.
Birchfield’s meager population is at the heart of many of its financial issues.
As Fox previously told The Chronicle: Typically, when a developer works on a project, progress is steady and the money needed for operations is funded by the stream of new residents.
Not so with Birchfield.
“In this case, everything has sat dormant for years,” Fox said.
In late 2008, District 5 ran out of cash. Fox, as the real estate developer, loaned the water district — of which he was commissioner — about $46,000. He set the interest rate at 5 percent.
Those overlapping roles continued and created multiple conflicts of interest, which, according to a 2012 state audit, exacerbated the water sewer district’s debt.
According to the audit, Fox maintained untenably low water rates to promote the sale of Birchfield lots. He also, during his 17 years as a commissioner, exempted himself from more than $80,000 in water and sewer payments.
In response to the audit findings, Fox said he would resign as commissioner. In early 2012, he relinquished his seat to his son, real estate agent Gary Fox.
If Fox wins this election and resumes his role as District 5 commissioner, he will be in direct conflict of his promise to step down.
Hilliard, Deborah and Toups, say a win would afford them the chance to address the injustices they say they’ve suffered over the last three years.
Hilliard worries that, if they don’t win, Fox will again use his role as commissioner for personal gain.
He said the Foxes have taken aggressive — though not illegal —steps to improve their chances in the election.
“Quite a few people have moved into the rental houses since those three registered as candidates,” Jimmy said about a small cluster of houses near Birchfield winery that Fox owns. “Kristine Carter, who is the district clerk, she moved in with Virgil where the water district office was. She apparently lives there now.”
Should the residents win, they will first tackle Fox’s fee collection policies.
Fox currently owns about 60 percent of the water hookups. He pays his water and sewer fees as a credit against the money District 5 owes to him, the owner of Birchfield.
That strategy forces Birchfield’s handful of residents to put up 100 percent of the cash needed to pay District 5’s costs.
“There shouldn’t be this burden on 40 percent of customers. I want to see if it’s even legal,” Hilliard said. “Even though technically the credit is payment, it’s not helping pay the monthly power bill, the inspections, the legal fees.”
Hilliard on Wednesday said as many as 14 mail-in votes could come into play before a second count Friday morning.
He is optimistic.
Both he and Fox acknowledge that the initial results from Lewis County’s smallest precinct are far from conclusive.
Fox declined to provide further comment for this story.
