Operational Shortfall in Sanitation Authority Budget Could Lead to Rate Hikes

While sewer rates soar in the Town of Berryville, County residents utilizing sewer service have remained somewhat shielded but that may be headed for a change.

Officials from the Clarke County Sanitation Authority appeared before the Clarke County Board of Supervisors Finance committee seeking a $27K subsidy to help them get through a budget crunch that they believe may be short lived. Sanitation Authority Administrator Mike Legge portrayed the funds as a stop gap measure that would help them get by an operational funding shortfall that he pinned on several factors. Board member in reviewing the request saw a disparity in the rate structure between the county sanitation authority and the Town of Berryville and asked the sanitation authority to explain the difference.

The Clarke County Sanitary Authority is a governmental corporation created by the Clarke County Board of Supervisors in January 1988. The Authority provides water and waste water service to the residents of Boyce, Millwood, and the Waterloo Commercial district. Sewage waste is processed at the Boyce Sewage Treatment Facility. Exclusive Sewer Service areas define those properties that may be connected to the sewer system which currently serves approximately 300 customers.

Mike Legge briefed the committee on the current situation and cited pressure from increased chemical costs and a sharp decrease in new homes and businesses connecting to the system. He described the state of the system and the financial challenges saying:

“One of the reasons that we built the new plant was to meet the Chesapeake Bay regulations for Phosphorous and Nitrogen. THere are two chemicals we use to offset those. One is Micro-C for Nitrogen and the other is perichloride which takes care of the Phosphorous. When we first opened the plant I was working off of estimates that said we would pay $8K-$10K per year for chemicals. Once we got going it ended up being $40K-$50K. Obviously that made a big change in our budget which is the main reason I’m here about the subsidy.”

Vice Chairman of the Board of Directors for the Sanitation Authority, Dan Mackay-Smith added, “We are working on two ways to save costs, one is to tune the plant and save as much as possible on chemicals and the other is to look and see if we can find alternatives.”

Cheaper alternatives to the chemicals currently used by the plant all come with significant drawbacks. One is a sugary syrup that increases the possibility of rat infestation and another is methyl alcohol based which presents a fire hazard.

Administrator Legge also pointed to the lack of new construction. Availability fees which are paid when a new home or business hooks up to the system go towards capital costs, which are separate from operating costs, but new connections also provide additional usage fees that increase the operational income to the small plant. Legge said when the plant was built they estimated 15 new hook-ups a year. Last year there were only four and this year there have been none. Legge said,” Not only are we are not receiving any capital from the hook-ups we are also not seeing any additional usage fees on new customers.”

The options on the table for the $27K shortfall were borrowing the money from the County Government or looking to outside lenders. However the Supervisors on the committee wanted to look at the current rates the authority charges.

Last year the County Sanitation Authority raised its rates and has the option to do so every two years. Even with their last increase they are well below what neighboring Berryville charges. Berryville rates are set on a  per 1000 gallons used basis and the town has seen enormous increases to cover the cost of building a new sewage treatment facility. The only place the county rate structure is higher than Berryville’s is in the minimum cost for customers that use 0-10000 gallons. That flat fee is $89.25 per two month period.

However Dan Mackay-Smith pointed out, “We have people right now who are complaining about paying the minimum. One of the things I think we should do is look at whether we should go to a system that is more like Berryville’s.”

That shift would drop the low usage end of the rate structure and increase the  cost for heavier users. (See rate table below)

Note: Town Minimum rate is for a one month period while the county's rate represents a two month period.

Rates in Berryville are already among the highest in the state and are scheduled to increase over the next two years. Dan McKay-Smith commented that, “We are at very high rates for this area, if you get the annual Draper report that is put out on the cost of water and sewer, we are always in the top 3 or 4 percent. Purcellville and Round Hill tend to be higher than we are but that’s about it,”

The Sanitation Authority will review the options discussed and update the Supervisors on their findings.