The West Hartford Town Council unanimously approved a resolution Tuesday night, requesting that the MDC switch its method of charging for sewer services to a user fee, and requesting that the contingency fee imposed as protection against the City of Hartford’s default be rescinded.

By Ronni Newton

The West Hartford Town Council passed a resolution with unanimous, bipartisan support Tuesday night, and with it sent a clear message to the Metropolitan District Commission (MDC) that the agency needs to not only change the way it charges for sewer services but also rescind the contingency fee that had been imposed to ensure it would not lose funding in the event the City of Hartford could not pay its bills.

Town Manager Ron Van Winkle said that he met with MDC representatives on Wednesday, and they said they were responsive to the change from an ad valorem tax to a user fee if the other seven member towns agree. “Now we need to convince the other seven towns,” Van Winkle said Wednesday afternoon.

This is the second resolution the Council has passed recently regarding the MDC and its method of charging for sewer usage via an ad valorem tax levied on the value of property in its member towns. In late January the resolution passed by the Council stated that there was a “fundamental flaw in the way the MDC sewer services are funded” and criticized the MDC for failing to undertake necessary planning to address the potential impacts to its 2017 budget or bond issue as a result of the financial crisis in the city of Hartford until it was too late to mitigate the fallout.

The two members of the Town Council, both Republicans, outlined their reasons for voting against that resolution in a Feb. 3, 2017, letter to the editor, but joined with the rest of the Council in introducing and approving Tuesday’s resolution.

Town Manager Ron Van Winkle, who will present the FY2018 budget to the Council on March 8, said that West Hartford is faced with significant challenges posed by a net $14.5 proposed reduction in state aid for education-related expenses. Other hits to the West Hartford budget include approximately $600,000 due to the MDC for increased operating expenses, plus the approximately $1.77 million to fund the reserve for the possible shortfall should Hartford default on its payments.

West Hartford’s Grand List had a sizable increase due to a combination of new construction and revaluation, and until the budget presented by Gov. Malloy on Feb. 8 proposed “unfathomable” cuts in aid to the town, other than the MDC charges Van Winkle thought that this would be a favorable budget year for West Hartford taxpayers.

Since the MDC informed its member towns last November that they would require the towns to set aside those funds, Van Winkle said he has had multiple meetings to discuss the tax levy.

“Ad valorem – it is a really unusual way for a water utility to raise money,” he said. “Most always with water utilities you pay for the water that goes out of the shower head and goes down the drain.”

The ad valorem tax is a charge based on the assessed value of property, and is not tied to actual usage. A user fee would benefit those who choose to conserve water, which is really the appropriate way, Van Winkle said. “If they were to shift to a user fee the issue of one town not paying their bill would go away.” 

The MDC would develop a rate for sewer usage based on its budget, and charge that to individual customers, just as they do for the water that comes out of the faucets. West Hartford, with its sizable grand list, would no longer be subsidizing other member towns.

The town’s budget would be reduced by approximately $10 million if the change were made as of July 1, 2017, Van Winkle said.

The other part of the resolution passed Tuesday night involves the issue of the reserve payment for Hartford. Based on the governor’s proposed budget, it’s clear that the state is not going to let its capital city go bankrupt, Van Winkle said.

“The issue of Hartford paying bills is moot,” he said and the resolution calls upon the MDC to remove the additional tax warrant because default is now unlikely to occur.

“This ad valorem tax makes our mill rates uncompetitive,” Mayor Shari Cantor said. That’s true for West Hartford as well as for all other member towns. The ad valorem tax on sewer usage hurts senior citizens who may still live in a larger home they bought years ago, but who may use very little water. “They benefit on the water charge but not on sewer charge. There is an inequity in this,” said Cantor.

“This is the year that we need to change that dynamic,” Cantor said, noting the many fiscal challenges that the governor’s proposed budget is creating for the town. “We feel like [ad valorem] is an outdated method and we need to be aware [that a switch to a user fee] is a way people can be in control and people are hungry for more control over what they pay.”

Minority Leader Denise Hall said that in the seven years since she has been on the Council she has continuously pointed out the unfairness of the ad valorem tax and said that West Hartford has been subsidizing the other towns all along.

In addition, Hall said, “When comes to budgeting they just throw a number at us and it makes our jobs very difficult.” Although having to pay the sewer charge along with their water usage charge would be a change for residents, she thinks it’s a good thing and increases transparency not to have those charges buried in the town’s budget.

Council member Beth Kerrigan said that the change to a user fee is common sense. “I can’t believe it costs more to flush toilet here than in other towns,” she said, just because a property has a higher assessed value.

Regarding the portion of the resolution that addresses the reserve fund for Hartford, Council member Chris Williams emphasized, “We’re not asking the MDC to rescind the tax. We’re directing it to do so. The condition for it no longer exists. It’s incumbent upon them to rescind it.”

Chris Barnes, who along with his Republican colleague Chris Williams had not supported the previous resolution, agreed that this time there was a clear directive to rescind the reserve fee.

Regarding a change to the user fee, Barnes said now that the MDC is moving to monthly billing they should be able to administratively implement the change. According to Barnes, the average annual cost per household will be $315 for sewer usage, but the exact charge would depend on the actual usage.

Deputy Mayor Leon Davidoff said that he appreciates having the full Council support for this resolution, and the strong message that it sends.

“You are in charge of your own destiny as a consumer,” he said of the user fee. The ad valorem tax is an “arcane concept,” and not something that anyone would have come up with today.

Davidoff also said that if the change to a user fee is made, it will be very important for the Council not to use the monies cut from the budget for other spending.

“I applaud our mayor for sticking to it working with the town manager on this draft resolution. This evening we’re taking a great step on a bipartisan manner,” Davidoff said.

Van Winkle said he’s still not certain if a change to the MDC’s charter is needed in order to switch from an ad valorem to a user fee, and that discussion will continue. If the change can’t happen in time for the July 1, 2017 implementation of the town’s next budget, it may be able be implemented as of Jan. 1, 2018, he said.

“This is another first step,” Cantor said. “It has become critical to our residents to provide some property tax relief.”

The text of the resolution appears in PDF form below.

Multiple budget meetings and forums will be held in the next several weeks, before the Town Council votes on the FY2018 budget on April 25.

Town Manager Ron Van Winkle will present the FY2018 budget on Wednesday, March 8. Incorporated into that document will be the education budget that will be released by Superintendent of Schools Tom Moore on Tuesday, March 7.

A forum with the West Hartford legislative delegation to discuss budget matters is scheduled for Thursday, March 9 at 7 p.m. at Charter Oak International Academy.

In addition, there will be a public information meeting on the budget on March 13, beginning at 6:30 p.m. in the Town Hall Auditorium. The Board of Education will host a town hall meeting focused on the superintendent’s budget on March 23 at 6 p.m., at a location to be announced.

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