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One Authority on Water?

December 2013

The Proposed Harford County Regional Water & Sewer Authority

Craig A. Ward President Frederick Ward Associates www.fredward.com

Craig A. Ward
President
Frederick Ward Associates
www.fredward.com

The Harford County Government, in conjunction with the three County municipalities, Aberdeen, Bel Air, and Havre de Grace, are evaluating the feasibility of creating a Water and Sewer Authority that would potentially combine the water and sewer systems of the four jurisdictions under a single operating entity. The Authority would be independent and run by a Board of Directors appointed by the participating jurisdictions. The new entity would be formed as provided for in State law, and would be a non-profit organization with bonding authority, would have its own staff, and would own and jointly operate all of the combined utility facilities. Having studied the various aspects of this proposal for most of this year, the Advisory Committee, made up of representatives of the four jurisdictions, has concluded that the proposal has merit and that more detailed evaluation should be done.

Operating utility systems under an Authority structure is very common across the country and has proven to be effective in many instances. Having a governance structure completely focused on providing quality water and sewer service to its customers, at arms-length from elective politics, allows for the long-term planning necessary to operate very complicated and highly regulated systems. In addition, there are efficiencies and added flexibility in operating the combined systems, which would benefit the customers and mitigate future risks.

This consideration is not without challenges and concerns, however, and the Advisory Committee has recommended that some basic principles be followed in further evaluating the possibility of setting up an Authority:

• Focus on ensuring efficient and sustainable water and sewer service for future generations

• Support municipal growth boundaries and annexation plans

• Preserve current employee status, employment security, compensation, pensions and benefits

• Transition transparently and without impact to the customers

• Offset municipal overhead costs currently mitigated by water and sewer revenues

For background, the County operates three main water treatment facilities and two main wastewater treatment plants plus water distribution and sewer collection networks. Both Aberdeen and Havre de Grace have their own water and sewer plants and piping networks, and Bel Air collects its sewage and discharges into the County system for treatment. In addition, the City of Aberdeen owns and operates the systems for APG/Aberdeen; APG/Edgewood has its own systems; and water for Bel Air and the surrounding area is supplied by Maryland American Water Company, a private company. To further complicate the situation, most of these systems are interconnected with Harford County providing daily and emergency water supply to the smaller systems. Harford County has approximately 40,000 customers and each municipality has approximately 5,000 customers each. Combined operating expenses are $45 million per year with debt service of $16 million per year.

It is obvious that there are efficiencies of operation that can be achieved through combining these systems. It is also very likely that addressing future challenges of additional supply needs, and addressing future regulatory obligations, will be more efficient, and more stable for the customers, with a combined solution. The ability to manage risk is also an important consideration and we are not immune to the natural and man-made disasters that have befallen water systems across the country and the world. Our main water supply from the Susquehanna River is from the same pool of water that is a major source of pollution for the Chesapeake Bay. Maryland American Water Company’s main water supply from Winter’s Run is subject to shutdown in low flow conditions, which would leave Bel Air short 1 million gallons of water a day. Many of our facilities could be devastated by hurricane damage. The more flexible and redundant our systems are, the better we will be able to mitigate for these potential problems.

That said, more information is needed before each jurisdiction can be reasonably asked to participate in an Authority or not. The next steps are more detailed financial analyses, rate studies, condition assessments, employment transition policies, planning process evaluation, capital improvement projections, and many other issues must be addressed. It will take several years of work to make this happen and we will keep you informed on the progress.

This is a regularly recurring column by Craig A. Ward on the environment and land use in Maryland. Ward is a Registered Professional Engineer and Certified Planner and is the President of Frederick Ward Associates, a civil engineering and architectural design firm in Bel Air. Ward has been involved in State and local land use and environmental policy and design for over 25 years. He can be reached at cward@fredward.com. I95

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