Cromer: Wivell wrong about sewer pact

October 24, 2007|By Kelly S. Cromer

This is in response to Washington County Commissioner Bill Wivell's Oct. 12 letter, "The city's bad faith." The City of Hagerstown has not acted in bad faith. As we stated in the proposed budget document last March and discussed in the budget review process and at the public hearing on rate increases that took effect Oct. 1, we adopted an across-the-board increase in sewer rates of 8.5 percent for general inflation, capital and debt service and operating cost needs of the system.

Outside-the-city users received an additional 7.5 percent increase to pay for the additional cost of $210,000 for the additional county treatment costs the city is paying under the flow-transfer agreement. The agreement clearly states that only customers outside the city are to pay these additional costs.

We started paying the county for flows under the transfer agreement last fiscal year in 2006/07 after the interconnection pipe was completed. We are complying with our obligations under the agreement.


And as I recall, Commissioner Wivell was part of the team that negotiated the sewer transfer agreement that was signed in 2003.

According to the July 22, 2003 minutes, Commissioner Wivell not only voted for the transfer agreement, but he was the commissioner who made the motion to accept it, which was seconded by John Munson and passed unanimously.

Now, it appears that Commissioner Wivell feels an increase is not necessary. So who is acting in bad faith?

In fiscal year 2006/07 the city paid the county $184,768 for county treatment costs under the flow-transfer agreement. Nothing was included for this cost in the proposed budget for last year, because the line was not completed when the budget was prepared. All the customers of the city absorbed this cost in the first year.

The amounts paid to the county for treatment costs are not based on actual billed flows from accounts upstream of the transfer point. The billing, per the transfer agreement, is based on the billed water consumption of all new sewer customers outside the city who were added after the flow transfer agreement was signed on Aug. 5, 2003, regardless of where they are located or where their sewage is actually treated.

In fact, until very recently, there was not a functioning sewer flow meter to even measure the flow at the transfer point.

Commissioner Wivell's letter creates a perception that the new city rates for customers outside the city are higher than the rates the county charges its customers. Not true.

For most customers using less than 20,000 to 25,000 gallons per quarter, the city's outside-the-city customer rates are lower than the county's own full-service rates. We also did not increase water rates for any of the customers inside or outside the city to help mitigate the impact of the need for higher sewer rate increases.

While our last cost-of-service study did not include an analysis of the cost of the flow transfer agreement on sewer rates, we have commissioned an update of the study. Among the cost elements that will be reviewed are the costs incurred under the flow-transfer agreement and any related cost savings. The study is just getting started. It will be done in time for work on next year's budget.

The county several years ago took the City of Hagerstown to the Public Service Commission to challenge our rate structure and billing practices.

The city's rates and practices were found to be fair. Commissioner Wivell also failed to mention that city residents, through their property taxes, pay for a county sewer debt that they neither incurred, nor are a beneficiary of.

Furthermore, the majority of the county residents, who are not customers of the county sewer system, also subsidize it to the tune of $3 million annually.

Lastly, the agreement does allow for changes, if both parties agree to them. The city is more than happy to sit down with the county to discuss these issues.

Kelly S. Cromer is an attorney and a member of the Hagerstown City Council.

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