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Lee PSA considering sewer rate hike

WALTER LITTRELL • Apr 24, 2007 at 11:57 AM

JONESVILLE - At the recommendation of engineer Bobby Lane, the Lee County Public Service Authority agreed to consider raising rates on the Hickory Flats sewer system.

In making his recommendation to the PSA board of directors Tuesday, Lane reminded the board that it had requested he analyze the rates for the system. Lane said that following his analysis, he was strongly recommending an increase. The engineer said the system primarily has two customers - the county of Lee and the town of Jonesville - with a few individual homes connected to the main line between the town and the treatment plant.

Lane said the town bills its individual customers then pays the authority. The county only has one customer, the federal prison, which it bills then pays the PSA.

In order to raise rates, he explained, the authority would have to notify the county it was considering a rate increase so the county can inform the prison because that notice is required in the contract with the prison. He added that the contract only allows for a rate increase every three years, and this is the third year of that contract.

Because of that, Lane recommended the authority consider a rate increase to cover the costs of operations. If a rate increase is not negotiated this year, he advised, it will be three more years before it can consider one.

"I recommend that you raise rates, so you need to advise the county so it can notify the prison," he said.

Board member D.J. Barker then offered a motion that the authority consider the rate increase, but after a brief discussion in which other board members realized a rate increase would impact both its few customers along the line as well as town customers, Barker withdrew the motion.

After Lane again stressed that it would be another three years before it can consider an increase again, Barker agreed to let his earlier motion stand.

Board member Mark Carter offered a second, and the motion passed with a statement by Barker that the authority is only considering a rate increase and is not actually increasing rates. The motion also instructed Director James "Doc" Parsons to notify the county administrator of the intention to consider an increase so that he can notify prison officials.

Lane did not offer any recommendations on how much of an increase is necessary. He also advised the authority that a public hearing will have to be conducted before an increase can be implemented.

In other matters, the board agreed to repay the Virginia Department of Housing and Community Development just over $26,500 while it awaits reimbursement from the Virginia Department of Health for work on the Cave Springs water project.

Lane explained that the project is administered by the Lenowisco Planning District Commission, and Lenowisco paid for work from VDHCD funds to spend down a grant in order to be eligible to seek another. However, he said, that violated a VDHCD rule that requires proportionate spending from both funding agencies, and the money must be repaid from VDH funds.

If the repayment is not made by May 1, then the county cannot seek VDHCD funding for a proposed water project at Blackwater. Lane said reimbursement from VDH could take three weeks to two months, and the authority could miss out on a funding opportunity by waiting on VDH money.

A motion to make the repayment included a provision for Parsons to borrow the money if necessary.

Parsons also reminded the board that there will be a 6:30 p.m. meeting on April 26 at Silverleaf Church to obtain user agreements for the Silverleaf water project.

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