Hagerstown council will swap 1 rate hike for another 

Trading one utility rate hike for another will get Hagerstown’s long-awaited water line replacement underway, according to a creative financial plan set for adoption on Monday.

Hagerstown Town Council agreed to put off a scheduled increase in electric bills in favor of adding to the cost of water after council member Brian Longbons gave results of his informal feasibility study. The agreement came during a March 18 special meeting in which council also set in motion an application for a grant to help pay for water line replacement, and agreed to seek bond funding through a state agency.

Council has known for years that the water system needs major repair. A 2023 study by the engineering firm Triad Associates found that the system loses 57% of the town’s water before it reaches customers. The firm estimated repair and replacement costs at $7.74 million to $10.83 million.

With Triad’s guidance, the council decided in February to embark on a first phase costing an estimated $2.86 million. It will include about 194 water customers on South Perry, Walnut, Pearl, Harrison and Washington streets, according to Chris LaMar, town manager. Some fire hydrants and valves will be replaced, as will pressure boosters on Main Street and at Hagerstown High School.

The work could begin in 2026 if the state Office of Community and Rural Affairs approves a $700,000 grant that the town will apply for by June 28, according to Lou Slavka, Triad’s president. The town would reapply later if the initial application is denied, setting construction back.

Ratepayers would need to come up with $2.16 million to pay the remainder. The council hired a consulting firm, Kleinpeter and Associates, to submit an application for that money to the State Revolving Fund. The SRF would sell bonds to finance the work at a lower interest rate than is available commercially. That application is due by April 1.

In February, Longbons first suggested his idea of killing an electric rate increase to pay for increased water bills with the least financial effect on customers. Since then, he conducted an informal rate study and convinced council members that the idea is solid. 

Under a plan adopted a few years ago, the electric rate is scheduled for an 8% increase on May 1, about $7 for the average customer, he said. However, the electric utility has adequate funds at present, according to Longbons and Clerk-Treasurer Julie Neal. 

Longbons and Neal collaborated on a study of three water bills paid by different kinds of households — single-person, two-person and six-person — to determine that adding 10% to the cost of water would mean water bills would go up about $2.75 to $3.25 a month. Longbons suggested a water increase in May or June, with additional increases in the next two years before the town starts repaying the State Revolving Fund. 

Council is planning to adopt that plan during its April 1 regular meeting. That meeting will also include a hearing about the OCRA grant application. It starts at 6:30 p.m. in Town Hall, 49 E. College St. The public may attend.