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More data sought on raising water, sewer rates

August 10, 2005|by GREGORY T. SIMMONS

HAGERSTOWN

gregs@herald-mail.com

The Hagerstown City Council asked city staff for more information Tuesday on a proposal that would generally raise rates for customers of the city's water and sewer system, as well as change the way those rates are calculated.

The primary problem facing the city regarding water and sewer rates is a projected total shortfall of about $470,000, Water and Sewer Department Manager David Shindle said Tuesday at the council's work session.

The city, expecting that shortfall, has budgeted for a 3.7 percent increase in water and sewer rates.

Any increase would have to be approved by the City Council.

The council also faces a decision on whether to change the rate-setting system used by the city, which includes a stiffer increase for water and sewer customers that are outside city limits but use city utilities.

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"It really is a matter of policy discussions," Shindle said.

Earlier this year, a city-paid consultant studied the amount of money the city charges water and sewer customers, and whether the money pays for the services the city provides, as well as whether the types of customers - residential, commercial, industrial - are charged fairly in comparison to each other.

The city holds two separate accounts for water and sewer collections, and the city has separate rate-setting systems for the accounts. Neither rate-setting system has been changed in nearly 15 years.

City officials said the rate study was something that had been planned for some time, but it was also something that had been requested in a dispute between Washington County and the city, a dispute that played out in the Maryland Public Service Commission.

County officials said that because a study hadn't been done in several years, it wasn't clear if customers with land in the county who connected to the city's system were being charged fairly.

According to city information, there were about 25,400 water system customers, 11,700 of which were inside city limits. The sewer system had about 16,900 accounts, 11,400 of which were inside city limits.

The consultant, Municipal & Financial Services Group, of Annapolis, recommended in its May 12 report changes that would increase bills for most customers of the city's water and sewer system, although some customers could see a decrease.

Officials said an average residential water and sewer customer uses about 13,000 gallons of water a month.

The result of the recommendations for an average home inside city limits would increase the quarterly water and sewer charges from $63.31 to $68.84, or $22.12 more a year.

Martin promised to return with more information in the next few weeks, and that a public hearing on the proposed rates could be set for September. Martin said the council needs to adopt new rates by December to meet budget projections.

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