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Baltimore County sets new rates for sewer system connections

Baltimore County residents hooking up to the county’s public sewer system will likely pay less interest on the cost of the connection, after the County Council approved a new bill Monday night.

Proposed by Republican Councilman David Marks and approved on a 7-0 vote, the new law will levy the same interest rate against residents as the interest the county pays when it sells Metropolitan District bonds.

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Residents currently pay 5% interest on the cost of their sewer connection spread over a 40-year period through charges on their annual property tax bill. Once signed into law, residents would pay the same interest rate as what the county paid on its most recent bond sale, said county spokesman Sean Naron, and the maximum rate would be capped at 5%.

For the last three years, the county has sold metropolitan bonds at an interest rate of 2.5%.

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County officials said the cost of sewer connections vary from home to home and could not provide an estimate on the typical cost.

Equalizing the interest rates “is very fair to the citizens of Baltimore County,” said budget director Ed Blades.

And it could be a benefit for those on fixed income, like older adults with “limited financing options,” said Marks, a Republican.

Marks proposed the bill ahead of a sewer line extension planned in Perry Hall Manor, he said, which will connect 121 homes to the public sewer system, affecting many older resident who live in the community, he said.

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Given that about a quarter of the county’s population are older adults “and a goodly number of our homeowners are 60 and older,” county administrative officer Stacy Rogers said, “we do fully support being able to finance these projects and offer the same rate that [the county is] paying.”

The bill initially left it up to the discretion of the county’s Budget and Finance director to determine whether to set an interest rate between 0% and 5% but offered no guardrails for how that rate would be determined. The bill was amended during Monday’s meeting to tie the interest rate to the county’s metropolitan district bond interest.

The lower rates would affect Metropolitan District Water & Sewer Fund Enterprise revenues, possibly resulting “in the need to reduce expenditures or increase other revenue sources in order to maintain fiscal balance within the fund,” according to a county auditor’s note.

Baltimore County draws from its Metropolitan District fund to pay for capital water and sewage projects, operating funds and debt service. The county is under a consent decree with the Environmental Protection Agency to upgrade its aging sewer system, paid through the enterprise fund.

The metropolitan fund totals almost $501.7 million this fiscal year with $165 million allocated for the county’s six-year capital plan.

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