MINUTES

PUBLIC HEARING

UNIFORM RATE BENEFIT ASSESSMENT

GREAT MILLS HIGH SCHOOL AUDITORIUM

APRIL 28, 2005

The meeting commenced at 7:03 p.m. In attendance were County Commissioner Dan Raley; Metropolitan Commissioner Tim Wood; Metropolitan Commission (MetCom) staff members King, Shreve, Kubinec and Bryan; together with attendees listed on the attached Sign-In sheet.

Mr. King welcomed attendees to the third and final Public Hearing on this issue. He introduced the officials present; stating that the purpose of tonight’s meeting is to discuss the new proposed method of financing the following capital improvements:

• Water lines, sewer lines, water elevated storage tanks, and wastewater treatment plants;
• Replacing and upgrading facilities as required by the State;
• Expansion necessary to keep pace with population growth within the County; and
• The ability to offer service to those areas that need it.

Following a brief summary of MetCom’s Mission Statement and the law under which it operates, Mr. King stressed that the Commission is financially self-sufficient; with the required funds originating solely from its customers. Major fees include:

·        Benefit Assessment Charge (BAC) which is responsible for repaying the debt service on water/sewer lines; and other facilities.

·        Water/Wastewater Service Charge: This charge generates revenue to fund personnel, chemicals, equipment, electricity, and maintenance of the water and sewer systems.

He noted that the method of calculating the Service Charge to a single uniform rate was implemented in 1993; and applying the same principle to the BAC was seriously deliberated for a lengthy period of time. With the assistance of an expert on financial management systems for public utilities, it was finally approved by the MetCom Board following 18 months of study and debate. Staff now proposes to  meet with the Southern Maryland delegation and BOCC later in the spring to obtain the necessary approval to proceed with this change in its law. The public’s questions, concerns and comments will be made available to them at that time.

In conclusion, Mr. King noted that he believes that some day MetCom will eventually include the full capital cost of expansion in a uniform BAC charge as is currently done by SMECO, Verizon and Washington Gas. However, this will only be implemented in stages after the Commission and its customers have sufficient time to experience both the advantages and disadvantages associated with the changes now being proposed.

At this point, Mr. Shreve was invited to proceed with his Power Point presentation, a copy of which is attached to the Minutes. A copy is also available for viewing on MetCom’s website at www.metcom.org.

Questions/Answers.

The following questions and answers originate from previous Public Hearings held on this issue:

Q.        What about developers; what do they pay?

A.        MetCom’s charge to the developer is a cost associated with delivering sewer and water mains to the proposed development; in addition to any required expansion of the treatment plant. It does not include the cost of building water/sewer lines, and construction of a pumping station within the community itself if it proves to be necessary. This is paid for by the developer, most of which is recovered from those people who buy lots and houses within the subdivision. MetCom does not propose to change this policy, either now or in the future. However, there are occasions when a developer has to pay for 100% of the cost to build a treatment plant, and sewer and water systems in a development located in a very remote area which does not have access to public water and sewer. In this instance, MetCom will pay the extra cost to expand that line if it determines that it might eventually have to serve other customers in that area in the future.

Q.        What about the Chesapeake Bay Restoration Fee?

A.        MetCom commenced billing this State charge in January, 2005. Monies collected from this will eventually pay for 100% of the cost of upgrading the Marlay-Taylor Water Reclamation Facility. These charges will continue indefinitely, as will the need for future upgrades.

Q.        From: Greg Thompson, Clarke Road, Piney Point:

Why am I charged for 6 EDU’s, when 5 EDU’s are undeveloped and I have no intention of ever developing them.

A.        Charges are based on the development potential of that property, which significantly increases in value with the addition of public water/sewer.

Q.        From: Bob Bowes, Clarke Road, Piney Point:

I live on the same road as Mr. Thompson, and strongly disagree with properties being assessed, solely based on acreage. The additional charge should only be applied if the land is actually subdivided.

Q.        From: BOCC Dan Raley:

Has any thought been given by the Commission during the evaluation of its laws whereby a property owner who has no intention of developing a large piece of property can sign an agreement to this effect; and committing to accept the appropriate charges at the time the situation might change? 

A.        MetCom has been informed in the past that this action would not be enforceable. The problem with allowing this to happen is that if the property owner changes his mind say, within 5 years, then MetCom would have lost 5 years of BAC which should have been applied in the meantime. Property owners with lots that are smaller than the current zoning allows, have been advised that it is permissible to de-plat those lots to allow them to fall into the current zoning minimum lot sizes. The BAC can  be reduced in these cases

Q.        From Mr. Barne Wheeler of Tall Timbers:

Can Mr. Thomas sell his development rights to allow him to do this?

A.        It may be possible in some areas of the County to transfer development rights to large pieces of property. MetCom will only recognize this if it is done through the County process. However, the problem with doing so in this instance, is that the area is designated IDA. This means that the County specifically added an overriding zoning category making these properties more developable than it would have been under normal zoning categories. This explains why it has such high development potential.

Q.        From: BOCC Dan Raley:

If property owners located within the TDR zone wish to sell some, or all, potential transferable development rights, would this be recognized by MetCom?

A.        Yes.

Q.        From Mr. Bob Bowes:

Why should MetCom have the authority to control my property? I am willing to pay for a total of two sewer connections. However, if it is ever developed, then the owner at that time should pay for the development rights.  

A.

Q.        Is it permissible to develop in this area?

A.        Yes!

Q.        From Ms. Versha Osborne, Tall Timbers.

Is it correct to assume that there cannot be any further connections made to the system in Tall Timbers? 

A.        Not exactly, in that an exception does exist. If a house in Tall Timbers currently using an onsite system develops an uncorrectable failure, then it is eligible to connect. However,  no vacant lots with new houses will  be permitted to do so.

Q.        Will this proposed change in law affect that policy?

A.        No!

Q.        Please clarify the issue of capital contribution for new construction.  (a) Would the entire cost of new development be paid for, either by the developer, or by people buying new houses, and; (b) will existing customers  subsidize new developments?

A.        (a) Yes. (b) Existing customers will not subsidize new development, although there is some capacity built within the upgrade that can serve new customers. Staff proposes to finance most of the cost of new development in future, and to operate on a system similar to SMECO’s. However, at the time, majority of the cost of expansion will be recovered by the proposed Capital Contribution Charges which will be charged to those new houses; together with the charges the developer is required to pay for his development.

Q.        You just said that new houses would not be permitted to hook up to the sewer. Why then, was a newly constructed house behind me recently connected?

A.        We have to define what the Town Center is, as opposed to Tall Timbers. The left hand side on down of the Sheehan subdivision and St. George Beach are all within the original service area. The service area on the right hand side, commencing from Sheehan/St. George Beach, does not begin until Piney Point. Tall Timbers was not within the original 20-year service area. The State signed a Consent Agreement with the County and MetCom in 1988, specifying that the only houses that could be served here would need to have a septic system in uncorrectable failure. This Agreement has been consistently applied since then, and is the  standard rule.

Q.        Why don’t we have metered service in Piney Pt? I don’t believe that my charges are accurate.

A.        It is impossible to meter sewer service without having water service;  and much of Piney Pt. does not have water service. Our system is set up so that the average non-metered sewage service charge is as equitable as possible.

Q.        From Mr. Bob Bowes:

The Clark Road sewer project was completed 5-6 years ago. Does the  20-year BAC disappear with the proposed change in MetCom’s law? 

A.        If this change is implemented in July, 2006, all current existing BAC charges will cease to exist on that date. The uniform BAC charge will continue in perpetuity, for the simple reason that there will  always be replacements and upgrades. SMECO also operates on this premise, as its bill includes the cost of building new lines for new customers, replacement electric lines and power stations, etc.

 Q.        From Mr. Bob Bowes:

However, SMECO charges are based on the house I actually occupy, and is not based on the acreage of my property. You have an incorrect system. 

A.        It is, of necessity, a different-type system. However, we appreciate your opinion.

Q.        Mr. Anthony Bond, Great Mills.

Will these improvements positively affect the taste of water in the Great Mills area which has been of consistently poor quality? 

A.        Not necessarily. All of MetCom’s water originates from the same source. Part of the problem may lie in the fact that the State requires the addition of chlorine to the water; which sometimes makes it necessary to flush the line more often. Please leave your name and address with staff tonight, and we will send someone out to check this.

Q.        Does population growth play a role in MetCom’s assumptions?

A.        Yes, it does. There was a very significant spike in growth during the past year which we are currently investigating to determine if the trend will continue. The latest information shows that this will not be the case.

Q.        We don’t have water meters in Town Creek? How is that going to affect our cost? Is it simply going to be averaged?

A.        Your community will be having water meters installed very shortly. The area is the final and most difficult part of the County-wide project recently undertaken by MetCom, because of the manner in which the system was constructed years ago. A small percentage of properties within the County cannot be metered at all, simply because it is physically impossible.

Q.        Do the meters need to be checked on a monthly basis? I recently received a $600 bill for overage which I feel I should not have received.

A.        What happens on the property is the responsibility of the property owner. There is a MetCom employee who services water meters. Call our office and he will check your meter. The original bill was sent to your tenant at your request.

Q.        From BOCC Dan Raley:

It’s common knowledge that Patuxent River is attempting to privatize the water and sewer systems on base. It is also common knowledge that MetCom has put in a bid for this. If MetCom should prove to be the successful bidder, how would that affect your remaining customers?

A.        It would increase the customer base for water and sewer and would probably save them between $100,000-$150,000/ year in costs. 

Q.        How soon do you think water meters will be installed in Lexington Park?

A.        Water meters have already been installed in the majority of Town Creek. However, staff will be returning within the next few months to complete installation in a number of houses and businesses that initially  presented problems.  

Q.        I live on Pickett Harbor, in Cedar Cove, yet I do not have a meter.

A.        This should not be the case. Please leave staff your name and contact number, and it will be investigated.

Mr. King thanked Ms. Novotny for her appreciative remarks, and reminded attendees that it should be recognized that although water and sewer systems built in recent years are significantly superior to those that were previously constructed, they will also wear out at some stage. At that point, the change MetCom is proposing tonight will prove to be a definite advantage to those customers.

In conclusion, he thanked them for their attendance, and noted that they could forward staff written comments, or by email through MetCom’s website, within the next ten days. Staff will also be glad to address questions and comments following this deadline.

The meeting concluded at 8:40 p.m.