Hearing concludes on water rates

December 3, 2010 - By Matt Armstrong Journal Staff Writer

RANSON - After the conclusion of a two-day public hearing regarding a proposed water rate increase for Jefferson Utility Inc. customers, those involved will have to wait possibly until January for a decision from the West Virginia Public Service Commission.

The public hearing was called, in part, because a number of JUI customers, as well as the Jefferson County Commission, filed for intervenor status with the PSC to protest JUI's most recent rate increase request, which was in excess of a 70 percent increase to current water rates.

JUI owner Lee Snyder, who also owns Snyder Environmental Services, has said the rate increases are needed because JUI, a privately owned company, has continued to lose money over the past several years.

JUI's water rate is $63.60 per 4,000 gallons of water per month, which makes more than 2,000 JUI customers pay the third-highest rate for water in West Virginia, according to a PSC Sewer Utility Cost Ranking from Nov. 26.

The public hearing was presided over by Sunya Anderson, an administrative law judge with the PSC, and Ron Robertson was the PSC staff attorney assigned to the case.

Jefferson County Assistant Prosecuting Attorney James Casimiro was the County Commission's attorney in the case, and attorney Sam Hanna represented Citizens for Fair Water, another intervenor group. Charles Town attorney Dan McDonald represented JUI.

One of the issues raised during the hearing was JUI's financial relationship and debt to JUI, and Snyder admitted that JUI's losses have been dragging SES down since JUI was founded. In an e-mail sent after Thursday's hearing, Casimiro said, "SES is the real utility," and, "JUI is a utility on paper only."

"The evidence showed that the financial arrangements between SES and JUI are so purposefully convoluted that JUI can continue to claim it is losing hundreds of thousands of dollars a year," he said. "Meanwhile, SES's balance sheets remain confidential and hidden from public scrutiny."

Another issue raised by Hanna and Casimiro involved alleged "double billing" that JUI enacts on its customers, which Snyder denied after the hearing.

"There's no double billing, and (Casimiro) knows that," Snyder said. "(Hanna) just wanted to try to make it sound like there was some deception here, but that's clearly not the case. There's certainly no double billing, and we would never be so unfair to even suggest something like that."

Citizens for Fair Water President Craig Daniel said that while he was frustrated with parts of the hearing, he believed good things came out of the proceedings.

"A lot of information that needed to come out has come out, but at the same time, I think until these two companies (JUI and SES) are split and all the convoluted interminglings of the two companies are split, we're never going to be able to truly understand what's happening," Daniel said. "The rate I'm being charged, I don't know any more about it now than I did before."

Jefferson County resident Chris Cody, also with Citizens for Fair Water, said he's "cautiously optimistic" about the decision the PSC will make in the case.

"I think that the Public Service Commission is finally starting to work on the side of the citizens of Jefferson County and the citizens that are paying Jefferson Utilities," Cody said. "I think that they're finally starting to realize that ... the way this is all accounted for is so convoluted that the accountants can't even figure it out. Snyder's own comptroller couldn't figure out how he came up with some of his numbers."

Snyder acknowledged the accounting complexities involved in the hearing and said it was easy for numbers to be misrepresented.

"Unfortunately it's a complicated hearing, there are a lot of accounting complexities and it's easy to misrepresent things inside of that," Snyder said. "And that's what I think we saw at the end of the hearing."

Now that the public hearing has concluded, Anderson must file a brief with her recommendations no later than Dec. 17, and any reply briefs will have to be filed by Dec. 23. The PSC will issue a decision on the case no later than Jan. 7.