Several Montgomery County Council members said Monday that they would like to follow the money, if only they could.
But after a 90-minute hearing in which top county and water commission officials struggled to explain $6.7 million in payments and credits to a developer for a project that cost about $3 million, the lawmakers said they were more confused and worried than before.
“It is very difficult to decipher where the money went,” said council member Nancy Navarro (D-Eastern County), who chaired the session to review a recent county inspector general’s report. The report described a convoluted system of payments and credits that appeared to have led Montgomery and the Washington Suburban Sanitary Commission (WSSC) to each reimburse the developer for the same pumping station and water main.
“I am not satisfied,” said Council President Valerie Ervin (D-Silver Spring). “It raised more questions than it resolved.”
About 1,300 residents of the west Germantown development, part of the Woodcliffe Development District for properties developed by Artery Hoyles Mill of Bethesda and Arcola Investment Associates of Hyattsville, are paying Montgomery $800 a household until 2025 to help the county defray the cost of infrastructure. Council members said they are worried that residents may be overpaying.
But Jennifer Barrett, the county’s finance director, said the inspector general had misunderstood the payment system.
“There were not double payments, because there were two different things going on,” Barrett said, responding to questions from council member Roger Berliner (D-Potomac-Bethesda), the only panel member to appear to disagree with the inspector general’s findings.
Barrett and other officials in the administration of County Executive Isiah Leggett (D) said that the system was legal and had been designed to allow growth in the county when bank lending was scarce and interest rates were expensive.
But that still left open questions about the wisdom of the system, even if it is legal, said council member Marc Elrich (D-At Large).
“It’s too bad nobody blew the whistle on this,” he said.
According to the report by Inspector General Thomas J. Dagley and Deputy Inspector General Christopher Giusti, some tried. The report said payments occurred even though senior officials in county government and the WSSC were aware in 1998 of the potential for double payments, and some WSSC officials tried to stop them.
The WSSC changed its procedures in 2004 to prohibit double payments, but the agency’s chief finance official, Tom Traber, told the council that he did not know why.
The risk of double payments was also outlined in 2007, in a report by council staff members looking into reimbursement plans for the Clarksburg Town Center developer. Council staff members urged the council to change the law to forbid double payments, but no law was passed, council records show. Elrich said at the time that he and other council members thought the potential for double payment in Clarksburg was a one-time mistake, not a sign of a systemic problem.
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