Residents Address Clearfield Municipal Authority Over Rate Increases

CLEARFIELD – Several residents attended last night’s Clearfield Municipal Authority meeting with concerns about the rate increase for sewer bills.

Board members attempted to answer those concerns and explain how billing worked and why the authority had raised the base rate to $84 per quarter.

Dennis Parada spoke first and said that the cost was a hardship to the elderly, single and poor and suggested the authority should be billing by the gallon.

He said he was also told that places like Graystone and the Dimeling would also be paying $84.  Manager Kevin Shifter said that was not true, as those places have four-inch meters and the base rate for them is $1,037.

Later in the meeting it was explained that residents with a 5/8-inch meter pay a base rate of $84, those with a two-inch meter, such as small apartment buildings, pay about $546 and those with four-inch meters pay a base rate of $1,037.

Chairman Russ Triponey added that the rate is in line with other municipalities and, in some cases, less, such as DuBois or Pennsylvania American Water, adding that the authority must cover the debt service.

Resident Marie Green also asked about billing by the gallon of water used or the number of people in a household and suggested the CMA should have held a town hall meeting to discuss the issue with residents.

Other residents expressed similar concerns until one person asked what brought about the charge of $84 and wanted to know what the breakdown was on their bills and where the money is going.

Between the board members, manager and Engineer Jim Balliet of Gwin, Dobson & Foreman Inc., an explanation was given.  Every customer pays a base rate, plus a surcharge of $20, which goes to either the borough or Lawrence Township, and then also an amount based on how much water is used.

In 2008 the state Department of Environmental Protection ordered the authority to start monitoring nitrogen and phosphorous output and fining the authority for going over set limits.

At that time, the authority found they would have to construct a new wastewater treatment facility because the old facility could not be adequately upgraded.

Balliet explained that it generally takes about five years for such a project to take place from planning to finished construction, but CMA faced delays when the main contractor defaulted and the insurance company had to step in to ensure the project was finished.

The project cost is $36 million, and while the authority was able to get some grants to help with the cost, including $4 million from H2O funding, but the rest needed to be financed through loans.

A sizable portion of the financing came through the Pennsylvania Infrastructure Investment Authority, which financed $16.3 million at 1 percent for 30 years.

Board members explained that PENNVEST required the authority to show that it could make the debt service payment by indicating customers would be billed a set rate each quarter, and PENNVEST will not allow them to change that.

Balliet added that the investment authority would not have permitted a variable billing rate, which is what billing by usage is.  To meet the fixed rate of payment of the loan, they have to have a fixed rate charged to customers.  If the authority were to default, another company would then take over.

Balliet also noted that 96 percent, or 4,600 customers, are residential and the other 4 percent, or 200, are businesses, apartments, etc.

He gave numbers based on average usage by a residential customer, which is about 7,000 gallons a quarter.  The base rate of $84 is only 30 percent of their bill.

Then there is the $20 surcharge and the rest is for the amount of water used by the customer.  An average quarterly bill is about $273.

The amount left over after the base rate and surcharge are subtracted is used for operations: to pay employees, purchase chemicals and equipment, and so on.  Of course, those with bigger meters have a higher base rate, plus surcharges and then the usage.

Triponey noted that the authority is a not-for-profit entity while other companies, such as Pennsylvania American, are for-profit.  CMA’s goal is to break even.

Some residents mentioned the money spent on streetscape improvements in the borough, and how there had been portions of that money they were told had not been spent and the borough was looking for other uses.

The residents asked why that money couldn’t have been given to the authority. That money is grant money earmarked by the state for specific projects and the borough is required to document how the money is spent and if it is not spent for the items approved by the state, the money would have to be repaid.  Therefore, none of the money for the streetscape projects, or the riverwalk, could be used to help the municipal authority.

The board voted Feb. 16 to increase the sewer rate to $84 with the change to take effect March 1, which will appear on the July bills.

According to information on the Web site, “Customers are reminded that although bills are issued quarterly, partial payments are accepted and for each bill, they have approximately 2-1/2 months to pay the bill in full.  Prepayments are also accepted.”

Payments can be made through the mail, by stopping at the office on 107 E. Market St. or online at www.clearfieldwatersewer.com.

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