Wide gulf still exists between sewer commission and campground owners

At a public hearing where input was sought on setting new rates for the Sewer Commission’s 2,143 customers Tuesday night, Chairman Richard Fournier came under verbal fire from Ron and Pamela Jaynes, the owners of the Silver Lake Campgrounds in Lochmere.

The Jaynes, whose legal proceedings against the commission resulted in the needed rate change, said Fournier had reneged on promises he had made to them regarding the rate schedule and had caused them serious financial damage.

When Fournier said that he had obviously made a mistake in estimating the cost of the Silver Lake Sewer Project several years ago, Ron Jaynes responded, “Your mistakes cost me money. You’ve wiped out my life savings.”

According to court records before the sewer project was begun several years ago the Jaynes expressed concerns that their 76 seasonal campsites would be paying the same rate for the construction costs as the approximately 45 year-round homes in the area, even though their campgrounds was only open from Memorial Day to Columbus Day. Before the project went before town voters, the Jaynes let the commissioners know that they were displeased and planning to object to the plan when it was presented at the annual town meeting.

But shortly before the meeting, the commissioners contacted the campground owners and indicated that they would only charge them 35-percent of the year-round home rate per site, which would have been about $94 annually, or $6,800 for the whole facility. As a result, Jaynes raised no objections at the meeting and the project got the two-thirds voter support to win approval.

But when the Jaynes got the first bills related to the construction project about two years later they saw the commission wanted about twice what it had promised.

The Jaynes brought suit against the commission in Belknap County Superior Court, and Judge Lawrence Smuckler agreed with them. He said the commission acted in “bad faith” with the campground owners and he ordered the commission to establish a new rate structure that would be “equitable” for them.

At the meeting’s outset, Fournier explained that the current rate schedule had been in place since the early 1980s but the court had ordered a new one. “The court has said we have to change the capital cost assessment portion of our sewer rate,” he said, referring to the remainder of the debt on the funds that were borrowed to help pay a portion of the $1-million sewer project.

“Also we will be discussing tonight the operation and maintenance part of the (rate) formula as it’s become time to adjust that also,” Fournier said. The chairman explained that there were three parts of the sewer bill: operations and maintenance (which is a fixed cost), the capital recovery costs to pay loan payment, and flow costs — which are actually the electrical costs used to pump sewage to the regional treatment plant in Franklin.

Fournier said that the commission had been subsidizing the flow as well as the operation and maintenance charges for several years. Whatever happened with the Jaynes’ case, the commission was planning on raising the operations and maintenance portion of customer’s bills. “We’ve been subsidizing those costs because we had the money to (do it) but we can’t do it much longer.” As a result, the rate will likely be raised $20 annually in March 2007, and another five dollars per quarter later that same year, the chairman said.

Andrew Piela of Nashua, who is acting as the Jaynes’ attorney, asked Fournier how he planned to restructure the capital recovery costs.

Fournier said he was considering a two-tier rate schedule: 100 percent for year-round homes and 50 percent for seasonal residences.

Resident Jim Culpon pointed out that there were “seasonal” homes in the area that were not used only in the summer. “They come up for skiing, they come up for this and that,” he said.

“If they can’t show they’ve closed the place down, they’re going to be considered year-round homes,” Fournier said. He said the commission has used December and January electrical bills to see if a residence is “year-round.”

Attorney Piela agreed that there were “seasonal” residents who used their homes for three seasons but noted that the Jaynes could not do that. “A hallmark of Judge Smuckler’s order is proportionality. I think if you draw a line in the sand and say this is it, I think it’s too broad.

“I think what you need to look at is perhaps three classifications: a year-round user, a seasonal cottage which could be used for two or three seasons, and a campground which we can only be open Memorial Day to Columbus Day,” he said.

“That’s over a six month period,” Fournier replied. “I can’t help it if it (the opening and closing) falls in the middle of the month.”

Pam Jaynes responded angrily to Fournier’s suggestion. “We are open five months to the day. We’re can’t be open anymore than that, we’re not allowed to. There’s no insurance. Any idiot can see that (difference). Can you?”

Mrs. Jaynes also raised the issue of Fournier’s previous promises to charge the campground a low rate. “Why did you write that letter that said it (the rate) was to be 35-percent or less (of a year-round residence)? Or the letter that said it would be 22-percent?”

“That’s not here what we’re here to discuss tonight,” Fournier replied. “We’re not here to discuss mistakes.”

Ron Jaynes laughed at the remark.

Attorney Piela tried to push his point. “Obviously the commission can’t just pull a number out of the air,” he said. “So I’m questioning what other sources of data will you be using to come up with a rate system?”

“I’d like to use what Sanbornton uses where everyone pays the same but the judge says we can’t,” Fournier replied. He said the commission had “reams” of rate-setting information, including a study done by Underwood Engineering of Concord in 2003, data from surrounding towns and information from the state Department of Environmental Services.

But Fournier pointed out that the capital cost recovery portion of the bill was not the same as the flow rate and that to some extent, “A hook-up is a hook-up is a hook-up.”

The chairman also said the commission would have to pay back between $10,000 and $12,000 in fees charged to seasonal homeowners in the last few years as a result of the judge’s order. However the members thought it would be unfair to ask year-round residents to make up the difference retroactively. They hoped that as more and more homes come on the system in the next five-to-seven years, the costs would even out.

“But the year-round home is going to end up subsiding the non-year-round home,” he added. “There’s no way around that.”

Ron Jaynes said Fournier’s plan was a bad one. “You’re coming up with your own formula which got you into trouble last time,” he said. “It’s been proven in court that there are all these other ways of doing this but you’ve never used none of them. You’re doing exact same thing.”

“You’re the only one telling me that,” Fournier answered.

“How many mistakes are you going to have that are going to cost me money?” Mr. Jaynes said.

The commission will hold its next meeting sometime next week when the new rate schedule will be established, Fournier said at the meeting’s close.