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Leesburg Adopts New Water Rates
Nonresidents Get A One-Time Cut

By Kafia A. Hosh
Washington Post Staff Writer
Sunday, August 16, 2009

Water and sewer rates will go up next month for Leesburg residents, and out-of-town customers of the public utility system will see a one-time reduction of rates before their bills also increase next year.

The Town Council narrowly voted for the annual rate increases during its meeting Tuesday, despite objections from more than two dozen customers from Leesburg and out of town.

Leesburg was under a court order to repeal the 100 percent surcharge that it imposes on out-of-town customers.

In a lawsuit filed in 2006 by several out-of-town customers, Loudoun County Circuit Judge Thomas D. Horne ruled in March that the surcharge was unreasonably high and unlawful under the state code. He ordered the town to set new rates by Sept. 1.

The town hired an outside consultant to conduct a rate study to create fees in compliance with Horne's order calling for a lower surcharge. Out-of-town residents will have water and sewer surcharges of 41 and 52 percent, respectively, through fiscal 2014.

Out-of-town customers will see a one-time 26 percent reduction in their water rates and a 20 percent reduction in their sewer rates this year. The quarterly bill for an out-of-town customer who uses an average of 18,000 gallons of water will go from $285.30 to $225.18

Water and sewer rates for out-of-town customers will increase by 5 percent over the next two years and then by 4 and 3 percent in fiscal 2013 and 2014.

Town residents will see a 5 percent increase in their water and sewer rates over the next three years, and then a 4 and 3 percent increase in fiscal 2013 and 2014. The quarterly bill for a resident who uses an average of 18,000 gallons of water will increase from $148.86 to $157.50.

Residents and out-of-town customers objected to the new rate structure.

Stewart Curley, a spokesman for the out-of-town residents who successfully sued Leesburg, said their water and sewer bills will go up an average of 10 percent under the new structure.

"We're trying to see where the relief is that we thought was in the court order," he said. "We're not sure that this is a fair or equitable structure."

Other residents complained that under the new rates, the town will base sewer charges on 100 percent of water consumption. Sewer charges had been assessed using the winter quarter method, which is a snapshot of consumption during the winter, when customers' water use is mostly limited to indoors.

The new rate structure "would really be billing us for services not performed by our sewer system," said David Anderson, a 15-year town resident.

"The winter quarter method . . . is an approximation, and maybe it needs to be fine-tuned, but we shouldn't go away from it completely," he said.

The new method for charging sewer fees will take effect Jan. 1.

The council passed the new rate structure 4 to 3, with Mayor Kristen C. Umstattd and Town Council members Kenneth D. Reid and Thomas S. Dunn II voting against it.

Council member David S. Butler defended the rate increase, saying that it was necessary to help close a gap of about $1 million in the utility system's budget this year.

But Reid said the shortfall occurred because the council postponed utility rate increases from 1992 to 2005. The council finally approved phased-in rate hikes in 2005 and relied on revenue projections based on customer growth.

"The idea was to support growth, but the council did not support growth" over the years and rejected proposed developments, Reid said.

Reid, who owns a newsletter publishing and book distribution business downtown, said he also was concerned about how the new rates would affect Leesburg's economic growth.

"I'm very concerned that high rates like that will discourage businesses from moving to Leesburg," he said.

Reid and Dunn said they wanted the town government to cut its spending and reduce costs instead of raising rates.

The council rejected the mayor's motion for another public hearing that would advertise a new rate structure. Umstattd said her proposal would increase residents' rates by no more than 2 percent a year and allow for a maximum out-of-town surcharge of 112 percent for water and 334 percent for sewer service.

Last week, Umstattd passed out a letter to constituents explaining her proposal and encouraging them to attend Tuesday's public hearing to speak against the proposed rate structure.

By going door-to-door, the mayor said, "You get to actually talk to people who are going to be affected by your actions. We talk a lot of numbers . . . but I would have to say in the town of Leesburg, we have a population that in general is not as wealthy as the population outside."

"And what that means," she said, "is that we have people who are stretched thin, who really cannot afford, even the lower rate increases that will be passed tonight."

The adopted rate structure is slightly lower than the proposed rates that were advertised during the council's July 28 public hearing. The reductions were made possible through cost-cutting measures that include a two-year freeze on a vacant utility department position, which will save the town $130,000. Another $298,000 will be saved over the next two fiscal years by cutting some maintenance projects.

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