A long-running dispute over who gets to provide water service to a major Daphne development has escalated into federal court, with Belforest Water System (BWS) accusing the city of Daphne, its Industrial Development Board (IDB) and developer 68 Ventures of conspiring to push the utility out of its own service territory.
BWS filed suit on Tuesday, July 15, in the U.S. District Court for the Southern District of Alabama, naming the city, the IDB and 68 Ventures as defendants. The complaint centers on Prospect Park, a roughly 49-acre mixed-use development planned between Champions Way and Highway 181 in Daphne that is expected to include around 700 residential units along with office space.
According to the complaint, BWS alleges the defendants worked together to steer water service for the development to Daphne Utilities instead, in an effort to get around a 2002 settlement agreement that divides service territory between BWS and Daphne Utilities. That agreement, along with federal and state water utility protections, generally requires a utility to either provide service in its territory or formally decline to do so before another provider can step in.
BWS attorney George Irvine wrote in the complaint that the city, the IDB and 68 Ventures “entered into a common scheme, combination and conspiracy to unlawfully curtail the services of BWS in its service territory” in an attempt to force the utility into declining service and consenting, in writing, to let Daphne Utilities take over. The suit also claims Daphne is violating federal law by considering franchise ordinances and permit fees on BWS within city limits while the city holds federal loan funding tied to water infrastructure.
The federal case is the latest chapter in a fight that began last year, when 68 Ventures and the city of Daphne sued BWS, arguing the utility was blocking Prospect Park from moving forward by refusing to let Daphne Utilities serve the site. That lawsuit claimed BWS’s resistance was holding up land deals between the developer, the city and the IDB.
Court filings show 68 Ventures initially approached Daphne Utilities about serving the project area in 2024, only to learn the property fell within BWS’s territory. When BWS later issued a “will serve” letter, it applied to a different, smaller project — a six-building plan the IDB had proposed for the site back in 2016 — rather than the larger Prospect Park development now planned.
Cost has been a central point of contention. BWS has said any infrastructure upgrades needed to serve Prospect Park would have to be paid for by the developer, which 68 Ventures has estimated at roughly $10 million. Daphne Utilities, by contrast, reportedly offered to extend service to the site for about $2 million, a gap that has fueled the push to bring in the city-owned utility instead.
In its new federal complaint, BWS also points to a separate agreement the IDB held for the same property tied to earlier plans for a science park — the same project referenced in the 2016 “will serve” letter — under which the IDB would remain responsible for water infrastructure costs through 2026. BWS further alleges that 68 Ventures hired a consulting firm to handle “due diligence” on water service at the site, work the utility claims was also aimed at making it harder for BWS to demonstrate it could reasonably serve the property.
As of this week, no response to the federal complaint has been filed and no hearing has been scheduled. U.S. District Judge Kristi DuBose has been assigned to preside over the case. Daphne Mayor Robin LeJeune declined to comment on the litigation, and representatives for 68 Ventures did not respond to requests for comment.
The federal suit runs alongside an ongoing appeal in the original Baldwin County Circuit Court case. In late June, BWS appealed a partial summary judgment that Circuit Judge Ashley Siebert issued in favor of 68 Ventures and the city on two counts of their complaint — a ruling that could ultimately support the position that BWS effectively declined to provide adequate water service to the development. Siebert has not yet explained the basis for her ruling, though attorneys for 68 Ventures and the city submitted a proposed order asking her to do so. That request remains pending, as does a hearing date before the Alabama Supreme Court on BWS’s appeal.
If Siebert’s ruling stands, it could clear the way for Daphne Utilities to serve the Prospect Park site, effectively carving the property out of BWS’s territory — the very outcome BWS is now trying to head off in federal court.