HOLDEN, Mass. — Months after selectmen voted to adopt the new water sewer rate structure to hopefully once-and-for-all address the long-in-deficit water/sewer enterprise fund, the board found themselves again looking at the rate plan after an oversight resulted in residents with larger meters being charged disproportionate costs — an unexpected effect selectman unanimously took steps to fix last night before a large crowd of distraught residents.
In an effort to determine how to stabilize the fund, which had a seven-year run of deficits, the town commissioned CDM to perform a study to comprehensively review the rate structure, rates and a plan for a rate stabilization fund and capital improvements, which they completed in February.
The firm had put forward five potential plans of action, with the top choice being a plan that would implement a fixed fee based on all fixed costs, then an inclining five block rate structure for all consumption.
CDM found this structure to be the most effective at providing revenue stability as well as the most equitable for cost allocation, and while selectman had voted in favor of adopting their recommendation, the 3-2 vote was split last May as board members differed on whether the plan's gradual rate changes would prove an equitable way to remedy the fund's revenue across all users.
Former Selectman Kimberly Ferguson and Selectman James Jumonville voted against the change, with Jumonville expressing concern that many on a fixed income were going to be negatively impacted by the structure, and said he was not in support of raising rates this way.
Formerly, the town's sewer rate structure uses a combination of a minimum charge rate and a commodity based rate for both residential and commercial customers, which provides a non-variable stream of revenue and helps maintain low costs for low consumption users.
Yet under the new structure, a hit to low-consumption users was expected, and while Selectman Anthony Renzoni had expressed sympathy that it would hurt one block of users at the time, he added that "we have to do what's best for everyone."
However, as the first billings went out in July, for some the hit was felt much harder than anyone expected, as Selectman had voted on the rate structure change under the assumption that all meters were 3/4" or 5/8" in size.
"At no point did I ever understand that any house had anything larger than a 5/8'' or 3/4'' line," said Renzoni. "I sat here for 18 months and that information was never presented and was never a topic of discussion."
Renzoni said that he had expected all residents to be treated under one share of the $36 fixed rate, and had he known about the larger meters he would have never gone along with such a rate scheme, relating how some of the residents from Greystone Drive are using an 8x factor — "so a $36 fixed rate times eight, and they're doing that for each month."
Because homes on Greystone Drive, for instance, have a 2" meter, and other residences around town have 1'' or 1 1/5'' meters — residents saw their bill make what they called "unjust and unreasonable" increases.
Moreover, town manager Nancy Galkowski said that in many cases those experiencing the greatest rate increases were those with low consumption and a 1" meter, and because of this it was the over 55 developments that were the hardest hit because "you generally have two people living there, you don't have outside watering, you don't have a pool, and you're required to have a one-inch meter in most cases for fire suppression services."
Residents such as Maria Sudar expressed their frustration with the bill changes, seeing her water bill jump considerably due to her 1'' meter.
Sudar is retired and lives alone, and said she has a difficult time making ends meet.
"How can I pay this?" she said, "I don't buy anything for myself. I go out to eat once or twice a year, I don't know how people who are low incomes that are alone make it, this is just terrible I think."
In an effort to buy time to look at the new rate structures again, Jumonville put forward a motion to revert back to the prior rate structure "until we finally do get a handle on what we're going to do."
Jumonville raised concerns that a month or so later "something else is going to happen that we're going to say we didn't see because it wasn't in the report."
The motion failed 4-1 as other selectmen expressed the need to ensure the enterprise fund remain solvent.
Selectman Ken O'Brien said he did not support the motion because the general fund could not support the water/sewer account any longer, and that it would fiscally irresponsible to go back to the previous rate structure.
"To go back to the way we were doing business would fail the rate-payers, and we'd be back to town meeting asking the entire town to bail us out again, and then we'll be having this discussion next summer," added Renzoni.
Renzoni instead put forward a motion to revise the water/sewer equivalency rates so that all residential meters will charged a base rate for a 5/8" meter.
Selectmen unanimously supported the motion, yet Jumonville expressed that "this will not help out the low consumption user."
Selectmen also unanimously supported a motion to charge the town manager to develop a system to credit the residents who were charged incorrectly in July by Nov. 1, 2011.