Hillsborough board approves Waterstone South annexation with infrastructure and affordable‑housing conditions

The Hillsborough Board of Commissioners voted to approve the annexation and rezoning request for the Waterstone South mixed‑use project at its Sept. 9 meeting, adopting conditions that require on‑site and near‑term utility upgrades, an affordability commitment and a greenway/trail fallback payment if the state does not permit a proposed alignment.

Planning staff opened the Board's joint public hearing on the Waterstone South proposal, describing the application timeline (first presented in 2022; neighborhood meeting Oct. 2023; multiple public hearings) and the principal elements of the project: roughly 200,000 square feet of medical/general office uses, about 40,000 square feet of neighborhood‑oriented commercial uses, a large residential component with townhomes and apartments, 15% of units designated as permanently affordable to households at 80% of area median income (AMI), and more than double the ordinance requirement for open space.

Molly (staff member) summarized options for the Board and noted updated ordinances and plats had been provided. Brian Green of the Utilities Department told the Board the site lacks gravity sewer frontage in parts and that the developer will need to replace or consolidate aging pump stations; he said the developer proposed replacing the Nazarine pump station on NC‑86 with a new station and abandoning two smaller stations, and that the developer would prepay some system development fees earlier than usual and contribute $250,000 toward interim upgrades at the Elizabeth Brady pump station.

The applicant, Eric CH, presented the master plan and economic analysis, saying the development would bring middle‑income housing and what he described as "meaningful affordable housing," and that the applicant had worked with staff to incorporate feedback. "We've listened to your feedback throughout the process and tried to incorporate all of that in the community," Eric said as he described 32 acres of open space and commitments to sidewalks, school crosswalks and two new Hillsborough bus stops.

During public comment, resident John Dempsey urged greater scrutiny of an intermittent stream on the site, arguing the headwater flows contribute to downstream reservoirs used for drinking water. "This little intermittent stream needs to be looked at for some considerations relative to the drinking‑water supply," he said, noting the stream ultimately connects to Falls Lake.

Landscape architect Dan Jeel read a proffer into the record offering to construct a greenway trail in the NCDOT right‑of‑way from the northern property line to Waterstone Drive if DOT approves the route; he said that if DOT approval is not granted by the time the final certificate of occupancy for phase two is sought, the applicant would instead proffer $150,000 toward future acquisition or construction of the greenway.

Board members pressed staff and the applicant on the sewer capacity analysis, the likely life cycle of the Elizabeth Brady station, enforceability of interior energy and insulation commitments for affordable units, and the adequacy of the $150,000 fallback for trail construction. Staff said the downstream hydraulic model included both committed and potential downstream developments and that a full station replacement for Elizabeth Brady will likely be needed within five years; the $250,000 contribution toward interim instrumentation and controls was described as a stop‑gap to allow smarter station operation until full replacement can occur.

Commissioner Rob moved to approve the project with the conditions presented and amendments discussed at the meeting (including the trail payment arrangement and a requirement that affordable units be integrated with market‑rate units and match in insulation/HVAC). Kathleen seconded. The Board approved the amended motion and separately approved the annexation request; the transcript records the measures as "all in favor" with no roll‑call tally provided.

What the approval requires and next steps The approval requires the developer to: construct the pump station and make the water‑line connections shown in the master plan; prepay system development fees earlier than usual to help fund downstream upgrades; provide 15% permanently affordable units at 80% AMI dispersed among apartments and townhomes; construct trails (asphalt except near streams/steep slopes) and sidewalks identified in the conditions; and either build the greenway in the NCDOT right‑of‑way or proffer a payment ($150,000, with board discussion tying that figure to town practice of requiring 125% of an engineer's estimate).

The Board did not record individual vote tallies in the transcript. The project now moves to any remaining administrative steps required to finalize annexation and to subsequent site‑plan reviews and permitting where engineering details, easements and enforcement language will be refined.

Quotes "We've listened to your feedback throughout the process and tried to incorporate all of that in the community," Eric CH (applicant) said. "This little intermittent stream needs to be looked at for some considerations relative to the drinking‑water supply," John D (resident) said. "The applicant will construct a Greenway Trail within the NCDOT right‑of‑way from the northern property line to Waterstone Drive conditioned on NCDOT approving this trail," Dan jeel (landscape architect) read into the record.

Context Staff and the developer described the package as a mix of infrastructure investments and development commitments designed to support future growth in the Elizabeth Brady basin while adding middle‑income housing and permanent affordable units. Staff repeatedly cautioned that the town's ability to support the project depends on keeping planned CIP projects in place and that some downstream upgrades will await CIP scheduling or future debt issuance.

The meeting proceeded to the Town's strategic plan annual report after the approvals; the Waterstone project will next proceed through the town's site‑plan and permitting processes where easements, cost estimates and enforcement language will be finalized.