UPPER MARLBORO — Knee-deep into its budget review process for fiscal year 2020, the Prince George’s County Council spent the past couple of weeks going over the proposed operating and capital improvement budgets for the Washington Suburban Sanitary Commission (WSSC).
The council was given a briefing of the budget by WSSC staff on March 28, followed by a public hearing on April 9 and a work session on April 11 where they reviewed the budget in depth with WSSC staff members.
“The men and women at WSSC go to work every day focused on one thing and one thing alone and that’s delivering the essentials; safe, clean water,” said General Manager Carla Reid at the briefing.
Susan LaCourse was the only person to speak at the public hearing and urged the council to give primary cost concern when making decisions regarding the WSSC, especially when it comes to the rate increases. After becoming concerned with the increases in her WSSC water bill eight years ago in 2011, she said she has been researching WSSC rates and advocating for WSSC customers ever since.
“I have been a WSSC customer since 1985,” she said. “Around 2007 I began to notice my bills increasing and by 2011 it was clear that there was more involved than just our increased usage as our family grew.”
According to LaCourse, WSSC rates have doubled since 2007 and fees have increased by 255 percent. She said that in 2007, 8,000 gallons of water cost her all together $56.26. Now it is $121.06. When the new rate structure goes into effect on July 1, her rates will immediately increase by 25 percent.
At the briefing, Carla Reid explained the consequences of a lower rate increase that include delayed projects and an increased cost of future projects resulting in a larger rate increase.
“We are very mindful that we are funded by our rate payers and we remain vigilant stewards of the public’s money,” she said during the briefing. “That is why we continue to look for opportunities to control costs and to save customers money in our fiscal year 20 budget without negatively impacting our customer service.
However, LaCourse was concerned about the impact that so many rate increases would have on customers, especially those who are unaware.
“Although WSSC did a monumental job at publicizing this change and soliciting public input, I guarantee that many customers are unaware of the change and you’ll be hearing from many of them when they receive their next bills,” she said.
LaCourse brought up a couple other topics in her testimony such as the level of debt service in the WSSC.
“Debt payments are approaching 40 percent of the operating budget and will be more than that if rate increases are held to less than six percent per year,” said LaCourse. “Keep in mind with six percent annual rate increases, our rates will double yet again in 13 years. This is a very large annual increase to expect customers to sustain year after year. If the increases are less, the ratio of a debt service to the operating budget will be larger.”
Finally, she asked the council to consider how much the WSSC is spending on capital projects, such as the Piscataway Water Resource Recovery Facility, saying that “WSSC spending on its future capital projects must be held down.”
At Thursday’s work session, the county council members who are part of the Transportation, Infrastructure, Energy and Environment Committee went over the budget in depth with a presentation by Senior Auditor in the Office of Audits and Investigations Kendra Reid followed by feedback from the committee.
She began with an overview of the WSSC which services 1.8 million residents in Prince George’s County and Montgomery County.
They have two water filtration plants and they expect to circulate 164 million gallons of water per day in fiscal year 2020. The water is drawn from the Potomac River and the Patuxent River and is delivered through 5,772 miles of water main. For sewage, they operate six water resource recovery facilities and in 2020 they expect to see 201 million gallons of waste water move through these facilities.
The proposed operating and capital budget totals $1.456 billion, Reid said. This is a 1.3 percent increase over fiscal year 2019. Of that, the total operating budget is $817.4 million with a 4.5 percent increase driven by debt service and supporting infrastructure renewal. The capital budget totals $638.5 million and actually decreased by 2.71 percent.
The budget includes a five percent rate increase which still leaves a $30 million gap between revenue and expenditures which will limit the growth of certain budget programs, defer some new initiatives, delay system-wide improvements and not allow for any new positions to be created. The WSSC only receives rate revenue from its customers, not tax revenue. In addition, 33 percent of its revenue comes from operating maintenance and 40 percent comes from debt maintenance.
There are quite a few projects in the works for 2020 that come out of the capital budget, which Reid also reviewed. Overall, there are 70 Capital Improvement Plan projects being looked at over a six year plan. Eight of them are information only projects, the rest are water and sewage projects. All of these projects total $5.1 billion.
Some of the projects that will take place in Prince George’s County are the Old Branch Avenue water main, the Clinton Zone Water Storage Facility, the St. Barnabas Road elevated tank replacement and the Piscataway Water Resource Recovery Facility.
A few capital projects, such as the water and sewage recovery programs, the Piscataway Bio Energy Program and the Potomac Consent Decree, will have a critical rate impact over the next six years.
Also at the work session, the council raised questions for the WSSC such as how they will be addressing sewage overflows, how they track and manage capacity issues for development, the timeline for implementation of their six-year plan, the history of rate increases and whether there is developments taking place in places that are not lending themselves to true economic development. Following the question and answer session, that meeting adjourned.
The next step in the budget process for the WSSC will be a vote on the final budget between Prince George’s County and Montgomery County. The bi-county meeting will take place on May 9.