The Canonsburg-Houston Joint Authority can raise the rates it charges customers less than it originally planned and will undergo an independent review of its books under a settlement reached with member municipalities in Washington County court.
The agreement, which Common Pleas Judge Michael Lucas accepted on Wednesday, allows CHJA to raise the per-1,000-gallon rate it charges customers by $1.34. The new rate takes effect Jan. 1.
Since last year, “tributary” communities – North Strabane, Cecil and Chartiers townships, plus the North Strabane and Cecil municipal authorities – brought several actions challenging widely varying rate increases the authority claimed it needed to impose on its roughly 18,000 customers.
The judge’s order continues scheduled proceedings in the litigation, so the parties could keep trying to agree on any remaining points of contention.
The agreement covers many of the disputes in the litigation, along with some “other issues” that fall outside the scope of the court proceedings.
A recurring theme of the court battle was whether CHJA – whose board is appointed by the borough councils of Canonsburg and Houston, the two members that didn’t participate in the legal fight – could justify additional increases in the bills it assesses from customers.
In the most recent bid to do so, the five-member board voted in October to increase rates to $7.30 per 1,000 gallons starting Jan. 1. Under the settlement terms, the rate will instead be locked at $7.10 from next year until the end of 2022.
A household creates about 4,000 gallons of wastewater a month. CHJA operates its treatment plant in Cecil.
The member communities first took CHJA to court in mid-2018. By then, the board had already decided to assess a series of rate increases from 2017 until 2021 to finance a roughly $50 million bond issue for plant upgrades.
But early in 2018, CHJA declared it planned to double customers’ bills for debt service on another $22.3 million in bonds it purportedly needed to float.
The work that the new debt would have paid for included modifications to a decade-old plan for plant upgrades. The state Department of Environmental Protection ultimately refused to approve the changes; municipal officials opposed the switch.
CHJA backed off of the new fee after Lucas issued a preliminary injunction stopping it from taking effect. The bond issuance was never finalized.
Last January, the authority again planned to increase rates. Its board passed a less ambitious one when the municipalities came back to court to ask for another injunction. CHJA officials explained the last-minute change by saying they were expecting to collect fees for about 270 new tap-ins, instead of the 100 they previously estimated.
In a March ruling blocking the increase from taking effect, the judge expressed skepticism toward CHJA’s claims that it needed the money to cover its operating costs. Lucas wrote that “whether the rate structure approved by CHJA is reasonably related to the costs of maintaining CHJA’s service is a substantial question that must be resolved.”
Apparently hoping to find an answer, CHJA agreed to undergo the independent audit for the period from June 1, 2014, to the present. That process is set to be completed by April 30, 2020.
Municipal officials conceded that they’d withdraw open-records requests they’ve made to Houston and Canonsburg, and to grant permits that allow for work the authority has planned.
Thomas Vreeland, the attorney who presided over mitigation sessions in the case, will oversee the audit and future discussions among the parties.