Proposed 37 percent water rate increase for Bel Air draws deep concerns

Multiple Bel Air residents, as well as business owners, elected officials and school representatives, expressed strong opposition Monday evening to a proposal by the town’s primary water supplier to increase its rates by nearly 37 percent to help cover the costs of building a reservoir to store a backup supply of water.

Maryland American Water, a private company that supplies drinking water to about 5,000 customers in the Town of Bel Air and some surrounding areas, is seeking approval from the Maryland Public Service Commission for a rate increase that would result in an average increase of $15.50 a month to customers’ bills.

Many of the 26 people who spoke during a public hearing before a PSC judge in the Harford County Council chambers in Bel Air Monday evening expressed concerns over whether senior citizens living on fixed incomes, or other low-income residents, could afford an increase in their water bills.

“To ask for a 37 percent increase, I think, is pure arrogance,” resident Dennis Reiman said.

People also questioned the impact on businesses and schools, and whether higher utility bills would be passed on to customers, parents and students.

“This will severely impact our budget,” Joseph McGrain, facility manager for The John Carroll School, said.

McGrain, who handles monthly water invoices, expressed concerns about how higher utility costs would affect the school’s ability to meet the needs of its students and parents already struggling to pay tuition.

He asked that the PSC deny Maryland American’s request.

Bridget Lloyd, of MaGerks Pub & Grill, said the Bel Air restaurant pays about $800 a month for water, which could go up to about $1,100 if the request is granted.

Lloyd estimated a cup of soup could go from $6 to $8, or a beer could go from $4 to $5 — the latter drew a cry of “oh no!” from an audience member.

The reservoir is under construction on the former Mt. Soma farm off of Route 1 just south of town. The facility, which Maryland American calls an impoundment, is meant to hold 90 million gallons of water that the utility can use as a backup water supply in case of a drought or unexpected contamination of the Winters Run stream, from which Maryland American draws water for processing in its treatment plant. The impoundment is being built near the treatment plant off of Route 1.

Jennifer Grace, a public utility law judge with the PSC, presided over Monday’s public hearing, which lasted about a hour and 45 minutes.

Grace said at the end of the hearing that her decision is not due until Jan. 24, 2019.

Lloyd Spivak also appeared, on behalf of the Public Service Commission staff, along with Anna Ryon, assistant people’s counsel with the Maryland Office of People’s Counsel. Both agencies will review all facts of the case, using their staff and outside experts, to determine the course of action that is in the public’s interest.

“Our ultimate goal is to keep rates as low as possible while allowing utilities to maintain safe, reliable service,” Ryon said at the start of the hearing.

Charles Keenan, Bel Air’s town attorney, appeared on behalf of the town government.

Two attorneys for Maryland American also attended the hearing. They were Christine Soares, the company’s director corporate counsel, and outside counsel H. Russell Frisby Jr., a partner with Stinson Leonard Street in Washington, D.C.

“The majority of the company’s proposed increase is driven by capital expenditures that the company has made to provide safe, adequate and proper utility service at reasonable rates,” Soares said.

Maryland American has adjusted its rates twice in recent years, in 2009 and again in June of 2015. Soares said construction of the impoundment, which started in the summer of 2017 and is expected to last up to two years, is “one of the most significant capital investments” the utility has made since its last rate adjustment.

Town Commissioner Phil Einhorn suggested the company amortize its cost of the impoundment, repaying it over 30 years to ease the burden on Bel Air’s many seniors, help Maryland American earn interest and “allow some of the cost to be paid by the next generation that will be using the reservoir for their families.

Einhorn suggested a number of ways town residents can conserve water. He said they obtain a 50 percent rebate from the town on the cost of a rain storage barrel purchased from a retailer in the town limits, such as Home Depot, The Mill of Bel Air and Courtland Hearth & Hardware. Purchasers must live within town limits, too, according to Einhorn.

Many commenters supported phasing costs in over time, rather than an immediate 37 percent increase.

Town Administrator Jesse Bane said town leaders request that Maryland American and the PSC limit the rate increases to where revenue just covers the company’s investment in the impoundment, and that it phase in cost increases over three to five years so customers can “adjust accordingly.”

Town Commissioner Amy Chmielewski expressed concerns about the impact on schools, businesses and residents, including her. Chmielewski fears she could not live in the town where she grew up if water bills increase.

“I do prefer Bel Air water to any other water . . . but I’m not willing to pay 37 percent [more] for it,” she said. “I’ll go buy a bottle of water.”

Grace extended, at the end of the hearing, the deadline to submit written comments from Wednesday to Thursday, Nov. 1. Comments can be submitted online at the PSC website, www.psc.state.md.us. They can also be sent by mail to Terry J. Romine, Executive Secretary, Maryland Public Service Commission, 6 St. Paul Street, 16th Floor, Baltimore, MD 21202.

Any written comments must include a reference to Case No. 9487, Grace said.

“Thank you for your opinions,” she told the audience. “All of your statements will be considered when I consider this case.”

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