ZEBULON - While the City of Raleigh insists Zebulon finalize plans for paying the cost of the water and sewer merger between the two entities, Zebulon Mayor Bob Matheny and Commissioner Curtis Strickland don’t think commissioners’ backs are against the wall.

Robert Massengill, the assistant public utilities director for the City of Raleigh, made it clear several times at the end of last year the town needed to make a decision on the matter by the beginning of 2012 to avoid the city implementing a surcharge on Zebulon water customers.

At issue is the length of the payout window for the $29.9 million the town owes the city through the merger, and 300,000 gallons per day of water capacity Matheny would like to keep that while the city and town staff are proposing the town give water back to the city.

Matheny said it is not a good situation to be in. But he thinks the town has options despite the looming pressure to speed up the process and the threat of a surcharge.

While he isn’t for it, he said one option would be to go ahead and accelerate Zebulon’s water rates. He said another choice is to let Raleigh apply the surcharge on Zebulon customers. He said there may be other options, like lengthening the payout and adjusting the scopes of projects in the merger.

“I think it’s the town board’s job to govern, not staff’s,” Matheny said. “The staff makes a recommendation, but the board doesn’t have to approve that recommendation. We can say, ‘Look, we don’t agree. Come back with some different options.’”

While the actual amount of a surcharge hasn’t been brought up in Zebulon, Rolesville customers took on a $5 monthly surcharge after that town decided it wanted to keep some of its capacity.

Raleigh Public Utilities Director John Carman said the amount of any surcharge applied to Zebulon water customers would be a function of projects the town decides to keep on its list and the amount of capacity it gives back or keeps.

Strickland said the possibility of a surcharge isn’t swaying his opinion regarding the decision. But he said he has yet to make a decision on whether he agrees with staff’s recommendations. He plans to meet with staff this week to discuss the matter before deciding.

“I don’t think my back’s against the wall,” Strickland said. “It really boils down to paying for something we’re not using or keeping something just in case. And if we ever want the water back, what will the price be?”

The future price of water is the basis of Matheny’s opinion the town should keep the 300,000 gallons — at least until there is a sign growth is, or is not, returning to normal.

Zebulon would get $4.50 credit for each of the 300,000 gallons if it gave the capacity back to Raleigh today — about a $1.3 million value.

“If you take the growth of that 300,000 (gallons of water per day) in the contract over the next 12 years, it grows to 4.81 million,” Matheny said. “If you take the $1.3 million and divide it by 4.81 million gallons, it costs $2.77 a gallon. That’s an incredible asset for Zebulon to have considering the water could cost $15 a gallon in the future.”

Matheny said he isn’t sure a surcharge will be imposed if the town fails make a decision on the matter at the board of commissioners meeting on Monday. He thinks Zebulon needs to make a decision some time in the spring, but is sure Raleigh will continue to push for the decision to be made as soon as possible.

Carman said Raleigh needs plans set in stone to be able to include them in the city’s 2013 budget. That means if Zebulon was issued a surcharge it would take effect on July 1 of this year.

“We’re saying do this now because we need to integrate their plan into our budget, and the amendment takes time to be approved,” Carman said. “We’re trying to be as sensitive as we can. There’s challenges with all the towns.”