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BEFORE THE PUBLIC SERVICE COMMISSION OF WEST VIRGINIA
CHARLESTONCASE NO. 04-0095-S-CN

CITY OF CHARLES TOWN SEWER DEPARTMENT
Application for a Certificate of Convenience and Necessity to Construct Improvements to the Existing Wastewater Treatment System

REPLY BRIEF OF INTERVENOR, PAUL BURKE

CONTROVERSY OVER COSTS

Charles Town's initial Brief baldly states, "This project will not require a rate increase,"(1) and "Huntfield will pay to Charles Town any shortage in debt service."(2) I wish their statements were true, and I ask that the PSC make them true by making any approval contingent on developer guarantees of the entire cost.

The staff memorandum calculated a potential $5.62 rate increase in Charles Town(3) after full use of the proposed $700,000 guarantee.(5) This is a 28% increase over the current $19.93 "typical" rate.(6) Rates in other jurisdictions would also rise by varying amounts. Developers want this project, and can guarantee the full cost. If the digester is dropped, as argued in my opening Brief, the total cost is about $1,000,000, and Huntfield has been willing to guarantee up to $1,700,000.(7)

Charles Town's proposal, where developers guarantee only 17% of the debt service,(8) is highly risky for rate payers.

POLLUTION AND CONVENIENCE

Staff and Charles Town base the "convenience" of the project on purported improvements in water quality.(9) Charles Town is misleading when its Brief says,

"total pounds of pollutants to be discharged into the receiving stream will decrease even though the capacity of the Plant will increase by 500,000 gpd!"(10)

Charles Town is also misleading when its Brief says,

"the proposed improvements will result in an improvement of water quality in the receiving stream, Evitt's Run. Thus, Charles Town has met its burden of proof that the project is convenient to the public."(11)

Charles Town plans to increase, not decrease, bacteria, which are the main cause of concern for human health. Bacteria will go up in proportion to capacity.(12) So if flows rise 46% to 1.75 million gallons per day, bacteria will also rise 46%. Considering the severity of bacteria releases in the past,(13) a 46% increase is a scary thought, and not "convenient to the public." Any PSC approval should be contingent on the project allowing no increase in any pollutant.

Furthermore any reduction in other pollutants (e.g. BOD) required by DEP may not be carried out, since "plant operators are unsure of the cause of most excursions,"(14) and this utility does not know why it has higher BOD influent than any other utility.(15) Constant upgrades without understanding the root cause, are a poor use of money, and again are not "convenient to the public." Charles Town has had plenty of time to identify the causes, doing a new study as recently as February 2004,(16) and they simply do not look at the study results.(17)

Nothing in this project solves, or even decreases, the problem of chemicals killing the BOD-consuming bacteria. "A foreign substance has entered the basins on several occasions which killed a majority of the bacteria necessary for treatment of the influent BOD materials."(18) Unless this problem is solved, higher flows just mean more pollution of Evitts Run when beneficial bacteria are killed. The utility has no program to solve this problem, and has not even publicized the problem locally so people who do not realize the significance of dumping can report what they know.(19) PSC approval should be contingent on efforts satisfactory to PSC staff, to identify and eliminate bacteriacidal dumping.

UNITS APPROVED?

Charles Town makes a big point of developers' applications for housing approval, including preliminary approvals shown in Burke exhibit 3.(20) Charles Town misses the point. Applications are the easy part; it is much harder to get final approval, build units, and sell them. It is particularly hard to sell units consistently at a much higher rate than in the past,(21) in the face of competition from close-in suburbs in Maryland and Virginia.

Charles Town says, "Jefferson County has recently experienced an increase in the rate of growth in its population."(22) This assertion is totally unsupported in the record, and in fact is not true. The PSC may ignore Charles Town's assertion or may take judicial note of Census figures(23) for Jefferson County which show the rate of growth has slowed each decade since the 1970s. During the 70s, 80s and 90s, growth was 3.60%, 1.72%, and 1.62% per year.(24) Charles Town's own Facility Plan Addendum submitted 5/04 shows 1.67% average growth in 1980-2000 as the "historic County growth rate."(25)

The most reasonable starting assumption is always a continuation of past trends. The burden of proof is on the utility and developers to prove a higher growth rate can be counted on. Surges in a few months, and wish lists of project proposals do not prove what the zoning process and market will really support over years to come. As stated in my initial Brief, the lack of local jobs, high gas prices, road bottlenecks, loosening land use controls in Virginia, and changing land use controls in West Virginia make growth at least as uncertain in the future as it has been in the past. The developer guarantee is not enough if growth continues at past rates, let alone if growth declines, and the guarantee needs to be increased.

PSD exhibit 1 confirms that most units do not have permits issued. The column in their exhibit marked "Permits" is virtually empty except for three treatment plants (Rahmi, Sanitary, and Sheridan) and Norborne Glebe and Huntfield, where few units have final approval.(26) The PSD's third green line, marked "Sheridan," says this subdivision "will provide own plant." If true,(27) this removes 178 units from the flows in the "Final Approval" column of Burke exhibit 1.

Ranson exhibit 1 includes a number of units listed as "completed," so they are already included in Charles Town flows, and are not a demand for future flows. Many other units on Ranson exhibit 1 are clearly marked as being at various proposal stages, rather than finally approved. Ranson's exhibit is not "prudent" nor an "analysis of sewer capacity needed."(28) It is a wishlist of proposals.

WHY HERE?

Ranson's Brief raises the alternative of their own treatment plant.(29) While this has not been raised before, it points out a gap in Charles Town's logic. Charles Town has not demonstrated why future needs should be met at their plant, rather than elsewhere. Jefferson County PSD has also discussed its own plant and lists several private plants in its exhibit 1. Separate plants can minimize the size of any one spill, pollution violation, or terrorist incident. I cannot take a position on the issue, because the tradeoffs have not been addressed in the record, but this is another reason why continuing customer growth at Charles Town cannot be assumed.

SUMMARY OF REQUESTS TO THE PSC

The following summarizes my requests to the PSC in this and past submissions:

  1. PSC approval should be contingent on the project causing no increase in any pollutant.
  2. PSC approval should be contingent on capacity fees approved for Ranson and the PSD.
  3. PSC approval should be contingent on developer guarantees of the full cost.
  4. PSC approval of the digester should be contingent on a year or two of compliance with the pollution permit.
  5. PSC approval should be contingent on a search for BOD sources satisfactory to PSC staff, followed by consistent work to reduce excessive sources, and submission of the maintenance description required by 150 CSR 1-26.1.14.g.
  6. PSC approval should be contingent on efforts satisfactory to PSC staff, to identify and eliminate bacteriacidal dumping.
  7. Public notice should be given that the project involves blowers, a digester, and discharge to Evitts Run, not an effluent pipe with discharge to the Shenandoah River.
  8. PSC should consider, in this and all similar cases, the overall costs and benefits to the state, not just local interests.
  9. PSC should consider the contamination risks from poorly maintained and breaking collection pipes when a project, such as this one, involves additional collection pipes.

Respectfully submitted,
Paul Burke, Intervenor
9/17/04 Date

1. Charles Town Brief p. 6. I note my objection to all other parties in this case making factual assertions in briefs without citations to the record.

2. Charles Town Brief p. 7, paragraph C

3. Lengyel/Weimer Final Memorandum p. 12. The staff calculation of rate impact is actually conservative, since it does not cover the cost of replacing equipment in 20 or so years.(4)

4.

5. Contrary to the Jefferson County PSD's assertion on p. 3 of their Brief

6. Lengyel/Weimer Final Memorandum exhibit 2.

7. 7/12/04 letter of commitment from M&T Mortgage Corporation

8. $700,000 out of $4,051,365 which is shown in Crews & Associates letter, 8/25/04, attachment labeled "page 4"

9. Lengyel/Weimer Final Memorandum p. 12 and Charles Town Brief p. 7

10. Charles Town Brief p. 7, last paragraph

11. Charles Town Brief p. 9, last paragraph

12. 8/24/04 transcript: McCoy p 190 line 24 to p. 191 line 9

13. Burke exhibit 1, first page

14. Lengyel/Weimer Final Memorandum p. 4

15. 8/24/04 hearing transcript: manager p. 92, line 22 to p. 93, line 13; engineer p. 161 lines 4-23

16. 3rd sentence on last page of Burke exhibit 1 (Design Manual Update 2/13/04)

17. 8/24/04 hearing transcript: manager p. 92, line 22 to p. 93, line 13; engineer p. 161 lines 18-23

18. Lengyel/Weimer Final Memorandum p. 4

19. Or stop dumping.

20. Charles Town also misquotes Burke exhibit 3. The "Preliminary Approval" column does not say or mean "Preliminary Plat Approval." While the PSC does not need to delve into the distinct legal phases in each jurisdiction, Charles Town should know the difference, and I cannot let the error pass uncorrected. Most units listed with "Preliminary Approval" have made only early submissions and do not have preliminary plat approval.

21. Charles Town Brief p. 7, top paragraph, assumes 225 units per year for ten years, where the past rate has been 78 or 97 EDUs per year, calculated in initial Burke Brief, footnote 3.

22. Charles Town Brief p. 5

23. 21,280, 30,302, 35,926, 42,190 people respectively, in the Censuses of 1970-2000: www.census.gov/population/cencounts/wv190090.txt and www.census.gov/census2000/states/wv.html

24. Compound interest calculations from the Census population figures

25. Facility Plan Addendum submitted 5/04, p. 14

26. Burke exhibit 3 and Huntfield 7/22/04 motion to intervene

27. Subject of PSC case 04-1026-PSD-C

28. Ranson Brief p. 2

29. Ranson Brief p. 2