Comments on: WATER WAR: City Found in Violation of Constitution, Charter

By: Arthur - Fairfax

Arthur - Fairfax — Mon, 18 Jan 2010 16:56:46 +0000

Is there a risk to the City when it supplies water? If there was a contamination or massive pipeline failure, how would the fix be paid for? Would the City residents (as owners of the system) be on the hook for this expense? As the City can only tax their residents, is there another way to pay for this? What return is allowed for taking such a risk?

I would think that the private water companies (Virginia American) are allowed to have a profit or a return on investment – why not Falls Church?

At the same time I think the City got greedy and are now going to pay for exceeding a reasonable return. (If only we could limit the return the big banks ..)

By: Melissa Teates, City of Falls Church

Melissa Teates, City of Falls Church — Tue, 12 Jan 2010 17:15:28 +0000

To me there were two very large mistakes made:

1) When we decided to transfer surpluses to the General Fund we should have made sure the methods we used were legal and aligned to the General Assembly’s decision to authorize municipalities to transfer fund proceeds to the general fund. We also should have made sure our charter, code and procedures were updated to reflect that change. Our city staff at the time (especially the city manager and city attorney) failed us in not updating the charter when we made the change. And, our council at the time failed us by not asking the right questions.

2) The second mistake was letting the contract with Fairfax County lapse and then suing Fairfax County. I understand it was an intentional move to let the contract lapse to give us more flexibility, but we didn’t really use the flexibility to be more competitive. Instead Fairfax became more competitive. We should have negotiated a new agreement with Fairfax instead of going to court. The whole legal parade was not needed and at the time I said it was a mistake.

Also, I think there should be some recognition that our water system costs differ from Fairfax Water. We get our water from a different source and we have had to fund with Arlington an upgraded water treatment plant to meet federal regulations. We have invested millions in the water treatment plant and in upgrades to water towers and water lines.

I imagine those citizens in Fairfax were pretty happy when we were able to supply water during the drought a few years back, while at the same time Fairfax Water had to ration their customers. That is the result of a different water source.

By: Charlie Anderson, FC

Charlie Anderson, FC — Sun, 10 Jan 2010 20:29:24 +0000

Darrel: When you bought your house, Falls Church supplied your water, yes? Then you made a conscious choice to use FC water. When you buy your power from Dominion, you don’t begrudge their profit do you? How about Washington Gas? BTW, FCC buys many public services from Fairfax and Counties, like courts, legal documents, health department, some senior service, etc. I am sure that Fairfax and Arlington don’t provide services at a loss.

By: Darrel Jonessey (Fairfax County)

Darrel Jonessey (Fairfax County) — Sun, 10 Jan 2010 17:56:44 +0000

Hey Charlie…

I most definitely begrudge you profiting from a government monopoly!

Here’s an idea… Why don’t you LittleCity’ers pay your own bills? Don’t overcharge me for water and use the slush fund to keep your real estate taxes down. Maybe even (gasp!) have your sanctimonious government spend less!

Your attitude is why so many of your FX County neighbors are happy to live outside The Little City.

By: Charlie Anderson, FC

Charlie Anderson, FC — Sat, 09 Jan 2010 18:53:41 +0000

Suppose a water system was owned by a private company. Said private company provided water in an area where it has for decades, where people who bought houses there knew that the company provided the water. That company increased its fees to maintain the service area, and expand as necessary. That company took its own risks with its maintenance and expansion. Being regulated by law, the company couldn’t make a profit, but continued to grow. Then the law changed so that the company could profit from its work so the company board voted to take a 2.2 million dollar profit yearly to its shareholders. Who would begrudge the profit?

By: Lou Mauro, Falls Church City

Lou Mauro, Falls Church City — Sat, 09 Jan 2010 03:39:12 +0000

Our illustrious City Council strikes again! Combining two thoughts from the comments of Kathy Washa and John Coleman says it all: “Orwellian elitists” (City Council) “unnecessarily poke the bear” (Fairfax County). Without a contract setting the terms of water service and pricing for Fairfax, a first-year law student could tell that both the Federal and State lawsuits brought by the City were losers. There is no end to the Council’s incompetence. Just to mention a few examples: haphazard, nonsensical development; careless handling of City finances; cowardly, arrogant changing of local election dates; now the loss of two foolish lawsuits, which will have a serious impact on the well-being of every man, woman and child in this City. To call this crew “The Gang That Couldn’t Shoot Straight” would be a gross understatement.

By: R. D. Cooley

R. D. Cooley — Sat, 09 Jan 2010 03:35:38 +0000

this is the first last gasp of a Little City being swallowed up into a big county. Maestro… cue the violins!!!

By: Robert Loblaw

Robert Loblaw — Fri, 08 Jan 2010 16:00:46 +0000

Falls Church tax payers, get ready for a mid-year tax increase followed by a fiscal year tax increase. Not that it won’t happen in other places as well.

By: Steven Hill

Steven Hill — Fri, 08 Jan 2010 15:36:41 +0000

As a City resident, one of the things I would be interested to know is the extent of legal due diligence in 2003 prior to the near-doubling of rates. I understand that there was a consultant who was brought in, but what were the qualifications of the consultant? Did we reach out to legal experts to determine whether the decision could be supported under Virginia law? Did we seek an opinion from the Attorney General, such as Warrenton did before using its water utility general fund surplus to build a recreation center? Perhaps the background on the rate increase decision is an appropriate subject for another very helpful multi-part series by the FCT. I note that that the Warranton opinion (Op. 03-029), which the City cites in a responsive document in the litigation, states that rates fixed by a locality are subject to an implicit reasonableness standard. It seems from this perspective that setting a higher rate for the purpose of generating a surplus that will be transferred to a general fund from which 90% of the utility’s customer’s will not benefit is, inherently, unreasonable.

By: John Coleman

John Coleman — Fri, 08 Jan 2010 15:18:28 +0000

George

In November you reported that the City had won the suit it filed against the Virginia Municipal League to compel VML to pick up the City’s defense costs. Did you ever obtain a copy of Judge Alper’s order and if so can that Order be posted? Has VML appealed that decision by Judge Alper. The trial of the portion of the claim by FCWA seeking money damages against the City is scheduled to start on February 1. In her opinion did Judge Alper address the scope of the coverage for the City to the claims made by FCWA. The obligation of VML to pay for defense costs may be broader than the obligation that VML has to pay for any damages that may be awarded by judge Ney. Do we know yet if VML will have to pay any damages awarded in part 2 of Judge Ney’s trial, or will any damages awarded come from City revenues? The fact that Judge Ney ruled against the City on the first portion of the case is not a good sign for the City on part 2 of the case.

At one point the Virginia Supreme Court appointed a special Court to hear the dispute between FCWA, Fairfax County and the City. Is that portion of the litigation still alive?

I assume the City will be forced to eventually appeal Judge Ney’s decision. Will the City need to wait until he resolves part 2 of the trial before an appeal can be taken? If the City appeals does the injunction barring the transfer of water funds into the City’s general funds remain in effect during the appeal?

In 2007 the City initiated litigation against FCWA in the US District Court. That suit was ultimately dismissed and the City’s appeal was also dismissed. Discussions by the City Council on litigation issues are held in closed sessions for obvious reasons. It seems to me that at some point information on the City Council’s closed door sessions should be made public so that voters have some basis to decide if council members made a bad decision, a good decision or the best decision that could make under the circumstances. Did all council members vote to sue FCWA in 2007 or was there a difference of opinion among Council members on this decision? What steps did the City leadership take in 2006 and 2007 to try to resolve this dispute with Fairfax County and FCWA before they took the litigation road? There has been some turn over on the Council since 2007, but some of the current Council members were involved in the decision to use litigation as the method to resolve the dispute over water issues. Did the City unnecessarily poke the bear or was the litigation route the only reasonable way for the City to proceed?

So far the City has lost all of the rounds of the Water Wars. I think the City leadership should schedule a public meeting to better explain to the City residents and water customers the potential long term consequences of the Court’s decision to the City and to the City’s water system.