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Bel Air

Bel Air gets clean 2013 audit, prepares to raise sewer use rates

The Bel Air Town Commissioners received an overall clean audit report during their work session Monday, although the report must undergo a final review before a formal presentation is made at the Jan. 21 town meeting.

The town is also moving ahead to enact the first sewer user rate increase in several years and is reviewing some options for the former school headquarters building on Gordon Street that is owned by Harford County.

Finance Director Lisa Moody said during Monday's work session town officials wanted outgoing Town Administrator Chris Schlehr to see the audit findings before he retired on Tuesday.

"We're not quite at that stage [of presenting for the commissioners acceptance] yet, but it was important to have this presentation while Chris was still here," Moody said.

William Seymour, partner with the Hunt Valley accounting firm of SB & Company LLC, said the town had a clean audit for the 2012-2013 fiscal year, which ended June 30, 2013.

"There's nothing, if you will, within these numbers that caused us any great audit concern," he told the commissioners. "Going through the process, management had the appropriate support for all numbers."

He said assets and liabilities had increased from the 2012 to the 2013 fiscal years, but the town had a "positive net income" for FY2013.

"All in all, the town's in a pretty healthy financial position," Seymour said.

Sewer rate increase

The agenda for the Monday, Jan. 6 town meeting, which the commissioners reviewed at their work session, includes the introduction of an ordinance increase the town's sewer rate by 22 cents.

Schlehr said town officials have been working with county public works officials for about two and a half months to get their questions answered regarding an increase in the bulk rate the county charges the town to treat its sewage.

"We're not really finished, but we need to get on with increasing our user rate consistent with the rate that they've increased our bulk rate," he said.

Moody said Tuesday that the current bulk rate charged by the county is $2.41 per 1,000 gallons, and officials have proposed an increase to $2.80. The increase must be approved by the town commissioners.

Schlehr explained Tuesday the change would have to be accepted by the commissioners as part of a change to the existing agreement between the town and the county.

Moody said during the work session that town officials recommend that the commissioners approve a 22-cent increase for Bel Air sewer customers, from $5.27 per 1,000 gallons to $5.49 per $1,000 gallons.

The base rate, which varies based on the size of the customer's water meter, is expected to increase by about 4.2 percent, Moody said.

Residents are billed on a quarterly basis, and use an average of 14,000 gallons per quarter; Moody said officials determined quarterly bills for residents with a five-eighths-inch water meter, the smallest size, would increase by about $3.31.

Residents will have an opportunity to comment on the ordinance at a Jan. 21 public hearing.

If approved, the rates would take effect in February.

Moody and Schlehr said sewer customers could see another rate increase during the 2015 fiscal year, which begins July 1, 2014, as the county implements an Enhanced Nutrient Removal fee on top of an established Biological Nutrient Removal fee.

Schlehr said the ENR fee, which is required based on state and federal policies, would cover "physical, mechanical enhancements to the treatment process to get more of the nasty stuff out."

"This is all a byproduct of decisions that were made on the state level, trickling down," Mayor Robert Reier said.

Moody said Bel Air's sewer rate is in the middle of local sewer rates – the county's rate is either $3.26 or $3.89, based on how many gallons a customer uses.

Havre de Grace's rate is $7.20 and Aberdeen's is $4.85, also billed based on use of water.

She said Bel Air's last sewer rate increase was July 1, 2013, as part of the FY2014 budget.

Schlehr said rates for municipal customers could decrease as a result of joining Harford County's proposed Water and Sewer Authority, although county customers' rates could go up.

Craig A. Ward, who represents Bel Air on the committee formed to review the regional project, made a presentation to the town commissioners in early December about the second phase of the project, which involves studying the rates and capital costs involved.

The town would have to pay a portion of the cost of Phase 2, which Schlehr estimated would be about $20,000 for the town.

"Let's sign onto Phase 2 and have the additional study done and see what the numbers look like, and I think, as far we're concerned, they'll look favorable, so then we're going to have to make the decision whether or not to throw in," Schlehr said during Monday's work session.

He noted the town will be at least a customer of the authority since the county treats its sewage.

"You're going to pay either way, so it may be just as well to be a member for sewage treatment," he said.

Gordon Street building talks

As part of the work session, Commissioner Edward Hopkins moved to enter into closed session "to pursue the acquisition of real property."

Director of Administration Michael Krantz said after the meeting no action was taken.

Schlehr said Tuesday the commissioners discussed the former Harford County Board of Education building on Gordon Street, which is boarded up and owned by the county.

"It's a very important historic property in town, and we're concerned about it," he said.

On Thursday, Sherrie Johnson, public information officer for Harford County government, said the county is weighing its options for the property, including selling it at auction.

"We will be going to [the County] Council in the spring to request approval for the county to surplus and hold a public auction to sell the property," Johnson said via e-mail. "We are currently reviewing all options in our effort to perform our due diligence and get the best price for the property."

Tax incentives

Moody told the commissioners CSFG-UCH Energy LLC will pay the town an estimated $2,250 per year in personal property taxes during the eight years that the company will own and operate a natural gas-fueled power plant to provide power for Upper Chesapeake Medical Center.

The $2,250 figure is 10 percent of the assessed annual property tax payment, which the company would pay to the town if the commissioners approve a Health & Safety Economic Development Grant Agreement at the Jan. 6 town meeting.

"The assessment on the personal property for this equipment is still going to come to us," Moody said.

She said the tax bill will be calculated based on the tax rate of $1.16, and the company will receive a 90 percent credit as the grant.

The Harford County Council approved a similar tax incentive agreement, known as a PILOT, or Payment In Lieu Of Taxes, in mid-December.

The company would pay $4,300 to the county in lieu of taxes each year from July 1, 2014, through June 30, 2035.

Moody noted Upper Chesapeake, which is a tax-exempt nonprofit entity, has the option of purchasing the power plant after eight years.

"Once that happens it becomes tax exempt," she said.

Wheelchair lift contract approved

The commissioners also reviewed a $10,900 contract to install a wheelchair lift behind the stage in the bandshell at Shamrock Park.

Schlehr said the funds will come through a grant from the Greater Bel Air Community Foundation.

Schlehr said the contractor, American Lifts and Remodeling of Timonium, will install the lift, then have it inspected by a "third party" and the state.

He said Tuesday the lift is part of overall improvements to the bandshell and the park, which were funded by the Dresher Foundation.

Monday's Bel Air town meeting will start at 7:30 p.m. at Town Hall.

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