WATER WAR: Plaintiff Rests; City Begins Its Defense

Fairfax Water counsel Stuart Raphael rested his case and Sandy Thomas began his defense for the City of Falls Church Wednesday, Sept. 16,  in the third day of trial in Fairfax Circuit Court.

In the morning session Mr. Thomas cross-examined expert witness Christopher Woodcock who had testified on Tuesday concerning the transfer of water service profits to the City’s General Fund.

In his testimony, Mr. Woodcock had frequently referenced policies set forth by the American Water Works Association (AWWA) which disapproved of the City’s practices.  During his cross, Mr. Thomas quoted a passage from McQuillan’s Law of Municipal Corporations (1911) which states that “A city is entitled to a reasonable profit and may even use that profit for other valid municipal purposes.”  Mr. Woodcock, who is not an attorney, acknowledged he was unfamiliar with McQuillan.

During re-direct, Mr. Raphael quoted other sections from McQuillan that state a utility may not overcharge a customer and that rates assigned to non-resident users must be non-discriminatory.  Mr. Woodcock stated that these and other citations quoted by Mr. Raphael were consistent with AWWA policy.

In response to a question from Judge R. Terrence Ney, Mr. Woodcock said that it was permissible for a utility to make a profit by providing service to outside customers but that such earnings should be retained by the utility (i.e., not diverted to other municipal accounts).

Mr. Raphael then introduced Charles M. Murray, the general manager of Fairfax Water, who stated that his utility has the lowest water rates in the region.  Their average charge for the last winter quarter as shown in this table is substantially lower than the City’s.

Much of Mr. Murray’s testimony concerned the issue of the City’s continuing claim of exclusivity in areas it services, even after a federal appeals court held otherwise in 2008.  He related that Fairfax Water, which has buildings serviced by Falls Church, has not linked those structures to its own system, in part due to the City’s intransigence concerning easements at another site (the so-called Halstead development).  Mr. Thomas objected to this line of questioning, stating that such issues  pertained more to the other counts of the lawsuit, which have been stayed until February.

Mr. Raphael rested his case after Mr. Murray’s testimony and Mr. Thomas prepared to make a motion for dismissal.  Judge Ney stated that both parties were due the full consideration of the Court and ruled that the plaintiff had met the burden of going forward.

Here Mr. Raphael, who had not previously advanced arguments based on prior cases, rapidly and with the aid of visuals, cited many decisions from as far back as 1908 in support of his client’s claim.    These then were presented to the judge as a bench brief.

Mr. Thomas then called his first witness, Glen Watkins, an economist specializing in public utility regulation and, along with Mr. Woodcock, a member of the AWWA.    He did not complete his testimony prior to adjournment.

Objections were filed frequently during the day as each attorney attempted to prevent the other from introducing documents, such as financial statements, internal memoranda, and council minutes, into evidence.  Mr. Raphael and Mr. Thomas both sought to limit the scope of the other’s presentation, intent on seeing that their history of the dispute prevails.  Items that Judge Ney did not allow into evidence were proffered “for the record.”  Such material will not affect the current action but may be noted later if the case is  appealed, which is likely.

City Mayor Robin Gardner attended part of the morning session of the trial and later was joined by Vice Mayor Hal Lippman who stayed on for the afternoon.

The trial continues today (Sept. 17) and then will recess until next week.