Water Balloon

Here’s a trial balloon. It is apparent that the Town’s water and sewer department has been financially mismanaged for many years. Ten years ago the utility fund had a substantial surplus, which today has all but disappeared. Last year consultants recommended rate increases to correct the problem. Unbelievably, until last year there had been no rate increase for water and sewer since 1992. Last year (FY 2006) the utility fund had a loss of $4.1 million compared to a loss of $2.6 million the year before. Connection fees and developer donations were $5.9 million in FY2006 and $10.8 million in FY 2005. These one time fees reduced the losses but you can see the trend. With fewer homes being built this very unfavorable trend will continue.

There is now a food fight between the Town and the County over who will provide water and sewer service to Crosstrail and other proposed developments that are just outside the Town boundaries. Last year the Town Council imposed a 100% rate increase on those living outside the Town but receiving Town water and sewer. This group filed suit.

While listening to the staff discuss some of these issues at several public hearings, it became apparent that the Town and the Loudoun County Sewer Authority (LCSA) work pretty well together. I have recently discovered that there is even an agreement that either entity will provide the other service in the event mechanical or other events temporarily curtail operations. I understand that this week those of us who live in the Town were drinking and bathing in County water.

Perhaps instead of raising rates the Town should look at costs, and ask themselves, why are we in a business that loses money? Why not sell the Town sewer and water department to LCSA. The savings in overhead cost alone might put the operation in the black.

The Town could take the proceeds and return the money to the tax payers by reducing taxes. The combined Authority could charge everyone the same. Sounds fair and reasonable.

The Town has one other business or “Enterprise Fund” that needs attention - the airport. I will save that for another time. Stay tuned.