The city's bad faith

October 12, 2007|By WILLIAM WIVELL

Over the past few months, I have been contacted by several constituents outraged by the most recent 16 percent increase in sewer rates for out-of-city residents imposed by the Hagerstown City Council.

Apparently the city did not perform a new cost-of-service study, which is the standard by which costs are allocated to the appropriate customer class and to activities that cause them (treatment, transmission, and collection). Instead, the city chose to increase rates on outside-city customers using two factors. These two factors were inflation and amounts paid to the county for treatment of waste transferred to the county's treatment plant through the interconnector placed in service in 2006.

When ground was broken for the line connecting city and county sewer systems, it was heralded as a great breakthrough in intergovernmental cooperation. The thought was that the two systems, even though owned and operated independently, could begin to operate, in part, as one regional system for the benefit of all residents. Federal, state and local governments, and developers shared their resources in order to make the project a successful reality.


It now appears that leadership in the City of Hagers-town is using this project as a detriment to all of those users of the system who reside outside of the corporate limits of Hagerstown. This was done when the city adopted its most recent rate increase and charged the approximate $200,000 that the city currently pays to the county for treatment of flows entirely to noncity residents. This assignment is just plain wrong for several reasons.

1. Users already compensate the city through their rates. Inside-city customers pay $3.83 per 1,000 gallons, and outside city customers are charged $6.72 per 1,000 gallons, or 1.75 times the inside-city rate. The county rate charged for treatment of this waste is $4.58 per 1,000 gallons, so the city collects an additional $2.14 for every 1,000 gallons treated at the county facility, which should more than compensate it for transmission costs and return on investment.

2. The county opened the interconnector valve fully, treating much more waste at its facility than what is currently being billed to the city, as the county is only billing for the incremental customer base added to the system since inception of the agreement. Due to the fact that the flows are not being metered, untold thousands of gallons of waste are being treated on a daily basis at the county facility at no cost to the city. This action further allowed the city to shut down a pumping station earlier than originally anticipated.

3. The city has failed to allocate/assign corresponding cost reductions to outside-city customers. In reality, the city has likely experienced a reduction in costs greater than those charges being reimbursed to the county. The city was able to take a pumping station out of service, is able to reduce flows in its own transmission system, is able to treat additional flows at its own plant, is not treating the flows transferred to the county plant, is recovering revenues above those that are charged to the city by the county and is not being charged for many of the flows diverted to the county facility. Were the city to properly allocate all "costs" associated with this joint project, outside-city customers would likely be due a credit and not an additional charge.

It is highly unfortunate that the city has acted in bad faith in its implementation of its rates on a project that was to be a mutual benefit to everyone.

It is ironic that, if county leadership chose to act in equally bad faith, it could simply shut off the valve and reduce costs allocated to outside-city residents by more than $200,000 annually. Also, as more and more flows are potentially diverted to the county plant, this mis-allocation of costs will only multiply if it is not stopped at its inception.

I would encourage all affected individuals to contact the Hagerstown City Council either by e-mail at,,, or or by phone at 301-790-3200 and demand that this cost allocation be stopped immediately!

Bill Wivell is a Washington County Commissioner.

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