Water contract costs unclear

Thursday, Feb. 16, 2006

When the long-awaited Potomac River water supply is available in Frederick, city residents will help foot the bill with higher water and sewer rates.

Just how much they pitch in is still up in the air.

‘‘The rates are still under discussion between the parties. The rates will be based on a fair charge for both city and county users,” said Doug Browning, Frederick County manager.

City officials have said in the past that new development would pay for the city’s one-third share of the $100 million pipeline project, via tap fees.

Though city and county officials have been negotiating a contract for nearly three years, the question of what the county will charge the city for water is still undecided. The new city administration made the water contract its first priority and hopes to reach agreement at its next city⁄county meeting on March 10.

‘‘I do not want to raise rates, or any costs,” Mayor W. Jeff Holtzinger (R) said, ‘‘but I am worried that it will be something that may be significant.”

He believes that the county wants to be fair in determining how much the city will pay and that it will reflect the actual cost of providing water to the city. The county, like the city, uses a tiered rate system, with the lowest volume users paying less than those who use the most.

The City of Frederick will receive, in phases, 12 million gallons per day in the next 10 years. City officials do not believe it is fair to charge the city the county’s highest rates.

‘‘The language in the contract presents the question: Are we going to pay the county’s highest rates? That is a big red flag, especially since we are putting all this money into building the line,” Alderman David ‘‘Kip” Koontz (D) said.

The city is supposed to contribute about $32 million for the project, which includes building a pipeline from the Potomac River, expanding the county’s New Design water treatment plant, and adding a tank and booster pump station.

‘‘The city doesn’t believe it should pay the highest rate, and I am not sure there isn’t agreement on that,” said Mike Marschner, the county’s director of solid waste and utilities. ‘‘We agree that it may not be fair to the city, but this is the way the county has been billing for 20 years.”

Rate comparison Annual water and sewer rates, based on 80,000 gallons (average use) per single-family home: Frederick city: $505.36 Frederick County: $649.20 Sources: www.co.frederick.md.us (water⁄sewer bill calculator); City of Frederick Department of Public Works

The cost will likely be somewhere in the middle, he concluded.

County users already pay more for water and sewer than city users. Those rates are higher, in part, Marschner said, because the county has to pump water further and has higher infrastructure costs, while the city’s system, though older, is more compact.

Regardless of the differences, Marschner said that county water users should not have to subsidize city water users.

‘‘If the city doesn’t charge an increased cost, should I have to raise the rates on my county customers to offset the costs?” he said.

The question of cost is the biggest stumbling block for Alderman Donna K. Ramsburg (D). While she agrees that the county should not subsidize city users, she simply wants the city to pay whatever it costs the county to provide the water.

‘‘Tell us what it costs you and sell it to us for that amount,” she said. ‘‘I just think what’s fair is fair.”

Ramsburg said city users will pay more in water rates and officials cannot make the distinction between new and existing users when determining those rates.

County staff has worked on cleaning up the latest version of the 22-page contract since Jan. 20. City and county officials meet March 10. If the city and county cannot successfully negotiate the contract, another option is still on the table, according to Alderman Alan E. Imhoff (R).

‘‘If they are not relying on us for the $32 million, they can build it alone and bill us back for our pro rata share,” he said. ‘‘One way or another, we will pay for it.”