Published: September 21, 2008 02:08 am      

Fairmont water fund ‘mess’ must be resolved

Someone hands you the keys to the house, it’s yours. And if there’s a mess inside, you’re the one who has to clean it up.

Let’s be perfectly clear that the current Fairmont City Council and the current city administration were not the ones who created the “mess” for the water fund. Currently, council members didn’t vote on the $40 million system-wide upgrade in 1998, and the current members of the administration didn’t sign their names on the dotted line on contracts with GE Zenon or Chapman Technical Group.

Instead, many of these council members were within weeks of taking their oaths of office when the city experienced a water crisis in early 2007. That crisis led to a financial crisis — one that the city probably won’t recover from without a significant water-rate increase.

While the city is contractually bound to go through a mediation process and then an arbitration with GE Zenon and Chapman Technical, it isn’t likely that any sort of settlement is on the immediate horizon, and council has agreed to put a 12 percent increase on its Tuesday agenda.

The 12 percent is just a portion of what the utility needs to be made whole. That smaller amount will start the process of an $8.7-million improvement to the plant that will prevent any future water emergencies caused by the lack of pretreatment at the plant.

What’s missing is the 39 percent, which will pay outstanding accounts, pay back the city’s general and sewer funds and bring the utility out of the red. In essence, the city will be made whole. And while we understand that it may be fiscally responsible to go for a 12-percent increase and wait for the outcome of mediation, arbitration and possible litigation, we have a feeling that 12 percent isn’t where the increase will end.

The water budget has been draining other city budgets since fiscal year 2006, city officials told the Times West Virginian editorial board during a meeting last week. It owes the sewer fund more than $230,000 and the general fund $1.2 million.

This isn’t a situation where money can be shifted back and forth without major implications. The general fund’s contribution to the anemic water fund has essentially killed any plans to pave roads within the city limits this fiscal year and has made the administration hesitant to fill any open positions. The utility provides water to a majority of Marion County customers, either directly or as resell customers through public service districts and water associations. So in order for the utility to keep all of Marion County in water, the residents and businesses of the City of Fairmont have been shortchanged $1.2 million worth of services and projects.

Ironically, it will probably be the resell customers, and not the direct customers, who will halt any sort of a rate increase anyway, whether it be 12 percent or 51 percent. If 25 percent of the city’s 14,000 direct customers or just one of its nine resell customers protests a rate hike, the issue will be put into the hands of the Public Service Commission to decide. And that process will take months to sort out — as we’ve seen with every rate hike in recent years. And while an administrative law judge from the PSC determines the fate of any rate increase, it will be the residents and businesses of Fairmont who faithfully pay their property and B&O taxes who will be pumping more and more money into the utility to keep the county in water.

So this is where it has to stop. The only way to protect the city’s residents from losing out on essential services is to protect the general fund from being raided by the utility. It isn’t unheard of, not even in Fairmont. The sanitary sewer board governs the sewerage and stormwater utilities and maintains its own fund, and its members are appointed by council. The only reason that fund is owed $230,000 from the water utility is because of a charge-back agreement for treatment.

It’s like a “bill” that hasn’t been paid instead of the direct loan the general budget has given the water fund for the past couple of fiscal years.

Neighboring cities have separate water utilities — the Morgantown Utility Board, for example, which provides water, sanitary sewer and stormwater services to Morgantown and much of Monongalia County. While the city owns the utility and appoints its members, the finances of the city and the utility are not intertwined.

When the water budget is finally mended, whether it be from a settlement, a rate increase or assistance from the state or a combination of all three, city council needs to seriously consider creating a full utility board and getting out of the water business.

There are far too many other issues that need attention and funding.