Penalties planned for late sewer bills

Published 12:00 am Tuesday, May 9, 2000

PROCTORVILLE – County commissioners expect to consider Thursday increasing the late payment penalty on Union-Rome Sewer District bills by 14 percent.

Tuesday, May 09, 2000

PROCTORVILLE – County commissioners expect to consider Thursday increasing the late payment penalty on Union-Rome Sewer District bills by 14 percent.

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"We have now gotten a legal opinion that the county commission has the authority to set rates within reason," commission president Bruce Trent said Monday at the Union-Rome Sewer Advisory Board meeting.

That board, a volunteer group of sewer users, recommended earlier this year increasing late fees from 1 percent to 15 percent.

"The advisory board feels that is within reason, so the county commissioners will likely address it this week," Trent said.

Board chairman Jim Spurlock said users cannot stand by and watch hundreds of thousands of dollars in delinquent sewer bills pile up because that could destroy the system’s budget and affect customers in the future.

"The district does bill sufficient money but the collection is not there," Spurlock said, adding that the delinquency rate is more than 40 percent.

"We thought perhaps an incentive would be created if the late fee is increased," he said.

Commissioners have studied the delinquent bill problem and Union-Rome’s depleting finances, for some time now.

The system’s carryover balance from one budget year to the next has decreased because delinquent bills reduce money coming into the system, Trent said.

"The projection this year is there won’t be any carryover and, in fact, the district may be operating in the red, which we can’t do," he said.

The county must ensure the sewer service continues to operate, and operate at the lowest possible cost to the consumer without a rate change, Trent said.

That’s why the county wants to consider the late fee increase and to hear proposals from management companies that promise a more efficiently run sewer system, he said.

One such company, American Water Services Inc. of Pennsylvania, presented two options to advisory board members Monday night.

American Water Services is a sister company of Ohio-American Water, which opened sewer takeover discussions with the county last year.

Under the first option, management of operations and maintenance, sewer employees would remain county employees, with direct labor costs reimbursed by American. Direct costs related to routine operation and maintenance would become American’s responsibility. Debt service and capital expenditures would continue as the county’s responsibilities.

The company projects it could save the county about $8,000 per year.

Under the second option, referred to as full service operations and maintenance, the sewer system staff would become American employees at comparable wages and benefits with an initial staff reduction of one position. Debt service and capital expenses would remain in county hands but all other direct costs related to system operation would be American’s responsibility.

The company estimates it could save the county about $55,000 under that plan.

Advisory board members, sewer system employees and concerned citizens quizzed American representatives for nearly two hours about its two options, draft contract details and proposed collection methods.

American basically proposes to manage the district in a public-private partnership with the county government, said Adam McDonough, mid-Atlantic regional manager.

Decisions regarding fees, collection policies, major capital improvement projects and other changes to the system would require county action, he said.

"We don’t come in and set our own rules and regulations, most decision making is at the county level," McDonough said.

The company brings more efficient procedures, a larger pool of experts and more ideas to bear on Union-Rome problems, he said.

It also could bring better buying power on grinder pumps and other equipment because American has national contracts for the 175 water and wastewater facilities it manages in seven states, he said.

However, contracts would likely require commission support of possible company actions to get specific jobs done, such as collections, said other company officials who attended the meeting.

The county has not made a decision but is reviewing a draft copy of a contract.