NFCMA seeks to recoup lost revenue
DUNBAR TWP. – The North Fayette County Municipal Authority is looking to recoup six years of lost revenue from a neighboring water purveyor that has continued to collect monthly fees from four customers in Menallen Township upon tapping into North Fayette’s main line. Douglas Sepic, North Fayette solicitor, indicated in a Nov. 15 letter to Pennsylvania American Water Co. that the sole purpose of the 1984 tap-in was to provide water service to four properties along Balsinger Road.
However, Sepic stated it was understood in the initial agreement that neither Pennsylvania American nor the residents compensated North Fayette for the water they provide.
While North Fayette authorized the tap-in, Sepic said, “It was neither the intention nor the understanding of North Fayette that it not be compensated for the water being used by the four residents.”
Sepic further stated that, “Obviously, there is an inherent unfairness in inequity in Pennsylvania American receiving income from these customers when it does not actually provide the water being used by the customers.”
Sepic requested that Pennsylvania American respond within 30 days of the letter, but since no contact was made, North Fayette officials agreed to bill them for the last six years, allowed under the state’s statute of limitations.
Those fees amount to a little more than $1,000, according to Robert Softcheck, manager, who added that the solicitor’s fees to file a lawsuit could exceed that figure.
On the other hand, Softcheck said North Fayette has to do something. “It’s a matter of principal,” said Wayne Reese, authority chairman.
“By sending them a bill, you’re putting them on notice,” said Sepic.
Because Pennsylvania American failed to respond, Sepic said that North Fayette has the right to file a lawsuit for inequity of collection of lost profits in addition to having the four customers changed over to them.
“The problem is its continuant and Pennsylvania American hasn’t done anything to change it,” added Softcheck.
In a separate matter, the authority approved a three-year contract with its union that calls for a 2.5 percent increase in wages in 2005.
Softcheck said 23 people are represented under contract that expires Dec. 31, 2007. Under the new pact, wage increases will continue for the next two years as in previous contracts by averaging the past 12 month percentage change of the Consumer Price Index.
In addition, the ceiling for a yearly percentage increase will be 4 percent and no lower than 2 percent.
According to Softcheck, the most significant change in the new contract was health benefits, which changed from Blue Cross Tradition to Select Blue, and the increase for life insurance coverage from $30,000 to $50,000, which would be reduced to $15,000 at retirement.
Turning to other business, Paul Kendi, authority secretary, stressed that the Dec. 8 decision of Point Marion Borough Council to reject an offer by North Fayette to take over its water lines will be more costly for residents.
The state Department of Environmental Protection has threatened to fine the borough if it does not show steps to come into compliance with water and sewerage system requirements.
North Fayette had proposed to undertake the necessary improvements to bring the borough’s system into compliance over a five-year period while increasing the water rate by roughly 7.5 percent until the remaining rate base was equal to $87 per quarter for 15,000 gallons of water or $29 per month for 5,000 gallons.
Under the borough’s current water rate structure, the cost is $81 per quarter or $27 per month for 5,000 gallons.
Instead, borough residents will see a $6 or more increase in their water bills in order to replace 60 percent of its water lines.