Havre de Grace could roll out steadily increasing water and sewer rates for at least the next three years, if the city council passes the bill it introduced at its meeting Monday night to set rates in advance for up to three years.
The water rates proposed are $4.55 per 1,000 gallons for 2012, $4.80 for 2013 and $5.05 for 2014, according to the legislation. Sewer rates would be $6.85 per 1,000 gallons for 2012, $7.20 for 2013 and $7.55 for 2014.
"This ordinance begins the process, as was discussed previously, of the mayor's proposal to set up the rates to allow the water and sewer commission to get out of the red and into the black," Councilman Fred Cullum said.
A public hearing on the bill is set for May 7 at 7 p.m.
The city has been going into the red in its water and sewer fund because it can't meet the debt service on money borrowed to upgrade its sewage treatment plant to levels mandated by the state, council members have explained. The plant discharges its treated water into the Chesapeake Bay.
Council members and Mayor Wayne Dougherty blame the financial mess on assumptions that new growth – mainly housing construction – would generate additional revenue to help pay for the plant expansion.
The recession killed the housing market, however, and the water and sewer fund, which is supposed to be financially self-sustaining from user rates and new connection fees, has borrowed from the city's general fund to balance its books.
Cullum said last week that while the housing construction market is rebounding in the city, he doubts it will return to the levels at which the previous water and sewer revenue assumptions were made.
Council members previously approved a city charter amendment that will allow them to set rates for more than one year at a time. Council members explained in recent interviews that a three-year rate plan will allow them to better manage the water and sewer fund's revenue stream, while also accounting for inflation.
Not all of the six council members support setting what amounts to a 5 percent annual rate increase and doing nothing else. Councilman Jim Miller said last week he believes the city still needs to cut more of its operating expenses in the water and sewer fund.
In other business from Monday's city council meeting, the council postponed action on bills dealing with the road code and also listened to residents on the proposed taxicab ordinance, which would put regulation of taxis more in the hands of Harford County and allow for competing taxi companies in Havre de Grace.
Lori Maslin, of Washington Street, said the taxi bill is a good step forward, but also said she was concerned about turning over most of the enforcement to the county, wondering if it would make it harder for the city to keep track of offenders, among other things.
She also suggested increased fines, and perhaps cumulative ones, for taxi operators who violate local laws.
Maslin said her car was recently hit by a taxi driver going the wrong way on a one-way street, and she has regularly seen drivers disobeying laws or running stop signs.
Joe Fiocchi, on the other hand, said regulating taxis would be unfair.
"I definitely think there's a need for more competition," he said, but added: "The selective enforcement of taxicab drivers to me just doesn't make sense. We can't just take one group."
Also at the meeting, Dougherty said he met with the four generals of Aberdeen Proving Ground, who he said all expressed interest in the area and were confident in the longevity of their positions.
"I must say it was an evening that was very enjoyable by both my wife and I," he said. "We are very fortunate to have APG as our neighbor."
The council also approved a 5K "Walk on Water" Walk and Run for the Delta Sigma Theta sorority on June 16.