County wants a review of city's water, sewer rates

August 22, 2002|by SCOTT BUTKI

The Washington County Water and Sewer Advisory Commission has asked the Maryland Public Service Commission to review the water and sewer rates the city of Hagerstown charges to non-city customers Washington County Commissioner William J. Wivell said Wednesday.

The advisory commission also wants the PSC to review a city financial practice, he said.

The Washington County Commissioners authorized the advisory commission's action, Wivell and County Administrator Rodney Shoop said.

Wivell serves on the advisory commission.

The advisory commission made the request for a review on July 28, Wivell said.

The advisory commission is asking the PSC to look into the city practice of charging customers who live outside the city higher rates than it charges city customers.

The panel also is asking the regulatory agency to look at a city practice of having some departments make a payment to the city general fund, Wivell said. This payment, called a payment in lieu of taxes (PILOT), is intended to represent the amount those departments would pay to the city if they were private companies.


Neither the county nor the PSC has contacted the City of Hagerstown about the request for a review, Mayor William M. Breichner and City Administrator Bruce Zimmerman said.

The county will put out a press release on the commission's action today, Shoop said Wednesday.

The commission is asking the PSC to look at the rates customers living outside the city as well as a recent rate increase for all customers, Wivell said.

"The city's rates have to be proportional to the cost of services to its customers and the commission feels that is not the case" with non-city customers, Wivell said.

Zimmerman and Breichner said they did not want to respond to allegations until they learned more about the review request.

However, they said the city's water and sewer rate structure were reviewed and endorsed in a professional study by an independent company.

Wivell said 47 percent of the city's residential water customers live outside the city and 27 percent of sewer customers are outside the city.

Money from those customers goes into the city's general fund through water and sewer payments and the PILOT program, but those customers do not benefit from services paid for with money from the city's general fund, Wivell said.

"It is basically taxation without representation," Wivell said.

Zimmerman and Breichner said the professional study by BCM Engineers of Philadelphia did not find a problem with the city's PILOT program. The company did a cost of services study for the sewer fund in 1988 and a rate study for the water fund in January 1991, according to city documents.

The rates are reviewed annually and adjusted as necessary to meet revenue requirements for the city water and sewer operations, but the basic rate differentials and structure have remained the same since those studies, a city staff report said.

The Hagerstown City Council on Tuesday gave preliminary approval to a proposal to have an outside independent consultant review the city's water and sewer rates.

City staff are to return to the council with further information, including a timeline and a plan for how the study will be funded, city Finance Director Alfred Martin said.

Zimmerman said when city officials asked for the study Tuesday, they did not know the advisory commission had filed a review request with the PSC about the rates.

The Herald-Mail Articles