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State panel won’t back Hill’s bill to cap water rates for customers outside cities

December 13th, 2013 11:38 pm by Hank Hayes

State panel won’t back Hill’s bill to cap water rates for customers outside cities

PINEY FLATS — A draft Tennessee state government study contains a recommendation against legislation that would cap Johnson City’s outside water and wastewater rates but also says those rates should be “both reasonable and justified.”

The study and action by Tennessee  lawmakers could have statewide consequences for municipalities offering utility service to unincorporated areas.

 At the urging of Piney Flats resident Thomas Hubbard II, state Rep. Timothy Hill filed a bill in the last legislative session to prevent Johnson City from charging  unincorporated customers more than one and one-half times the water and wastewater rates charged to city customers.

Hubbard had called Johnson City’s outside utility rate structure “a rape and pillage process” to induce unincorporated residents to request annexation.

But Hill’s bill met Johnson City opposition, with much of the testimony against it coming from City Manager Pete Peterson.

A water customer living in the Piney Flats area outside Johnson City pays about $40 a month for using an average of 5,000 gallons, while city residents pay $20, according to the state’s Fiscal Review Office.

Hill’s legislation was studied by state lawmakers and local elected officials on the Tennessee Advisory Commission on Intergovernmental Relations (TACIR), which has issued a mixed memorandum and report on the matter.

While recommending against the bill, TACIR also said “whether a customer lives inside or outside the city is not enough on its own to justify a rate difference.”

TACIR found Tennessee’s poorest and those on fixed incomes, such as the disabled and elderly, pay a larger portion of household income for water because water is a necessity.

For an expanded version of this article, please see Saturday's print edition or our expanded electronic edition.

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