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05/16/2022 01:06 AM
Pennsylvania House of Representatives
https://www.legis.state.pa.us/cfdocs/Legis/CSM/showMemoPublic.cfm?chamber=H&SPick=20130&cosponId=14865
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House of Representatives
Session of 2013 - 2014 Regular Session

MEMORANDUM

Posted: June 12, 2014 09:25 AM
From: Representative Dan Moul
To: All House members
Subject: Municipal authority costs and Fees
 


​In the near future, I will introduce legislation to provide a greater level of predictability and fairness to the process by which municipal authorities establish their fee and cost schedule.

​Like public utilities regulated by the Public Utility Commission, most municipal authorities provide for three basic classes of customer – industrial, commercial and residential. Their fees and costs are apportioned between the three classes and the various sizes of meters used by the authority to service each class. However, some authorities’ rate schedules, established tapping fees, minimum usage fees, etc., create circumstances where commercial properties are treated like residential properties and industrial properties are treated like commercial. In some instances, their fees have absolutely no relationship to the cost to provide the service to consumers.

The impact of these disparate rate-setting practices, especially as they relate to apartment complexes and manufactured/industrial ​housing communities, is an increase in the costs of those services. These costs are ultimately passed through to the residents, many of whom are are living paycheck to paycheck or are retired, living on a fixed income.

I was surprised to find out that the Municipal Authorities Act (53 Pa.C.S., Ch. 56) only imposes a duty on the authority to charge rates and fees that are “reasonable” and “uniform.” From my conversations with property owners, I understand this standard of review is nearly impossible to overcome.

My legislation will change the Municipal Authorities Act in four substantial ways.

First, a municipal authority's rate and fee structure to be "reasonable related to the costs associated with the services being provided." Next, rates and fees would be based on classification (industrial, commercial and residential) and meter size. Definitions for each of these classifications are provided for in the legislation.

Additionally, rates, fees and the calculations made to establish such rates and fees must be made available to the public and rate payers at least 30 days before they become effective. Finally, for municipal authorities that assess a minimum periodic usage charge for water service, the charge can be no greater than the average actual use over the last three years, plus 15%. For new customers, no more than the average minimum rate charged to others of the same classification and meter size.

I believe that this legislation will add a level of fundamental fairness to the process by which municipal authorities assess fees and costs. For many, I truly believe that very little will change. But, for those who fail to the make the connection between the rates/fees they charge and the service they provide, this legislation will level the playing field for all involved. Consumers will know the basis for an authority’s rate schedule; and have an objective, quantifiable standard to ensure that their rates are indeed fair.

I strongly encourage you to support this effort to amend the Municipal Authorities Act by adding your name to the list of cosponsors.

DM/ssb




Introduced as HB2343