Three city councilors say they want to protect residents who use — and pay for — municipal water and wastewater from shouldering an unfair burden of the overall city budget.
City Councilors William Macek, Michael Young, and William Ryan say an enterprise fund for the Water and Wastewater departments would stop the fees from being diverted when other city departments' budgets run dry.
They're also considering seeking a second opinion through an independent audit.
An enterprise fund, by definition, would tie the money raised from user fees and other water department billings strictly to the operational costs of the department. More importantly, an enterprise fund would separate those departments from becoming part of Haverhill's general budget.
By definition, enterprise funds are self supporting in nature as they pay for their costs only through money raised through usage charges and bills.
Homeowners who don't use municipal water and wastewater aren't paying the fees, yet receive city services, including police, fire and schools, that are propped up by water fees, the councilors said. They see the arrangement as an inequity.
Macek said 86 percent of Haverhill's residents use and pay for city water in their homes and 77 percent pay for and use wastewater services.
All three councilors agree the answer isn't severing city emergency service to these homes, but eliminating the uneven distribution of the cost of such services, Macek said.
"You're paying more out of your pocket to operate the city," Macek said. "This has encouraged the city to not cut back."
An enterprise fund, according to the councilors, would tie the money raised from user fees and other billings strictly to paying the operational costs of the department.
Water and wastewater has a total budget of $2.4 million for the current fiscal year, according to Water and Wastewater Superintendent Robert Ward.
In order to balance this year's city budget, Mayor James Fiorentini drew $510,000 from the water department and $480,000 from wastewater and allocated it to other city expenditures.
Young said an official with the Massachusetts Department of Revenue suggested operating the department under an enterprise fund. The councilors are investigating whether they are empowered to do so under the city's charter or whether it is under the authority of the mayor.
"The idea of a water and wastewater bill is to pay what's necessary to operate the department," Young said. "An enterprise fund would have greater control over the money collected."
While they did ultimately approve the mayor's 2011 budget, which continues the legacy of drawing funds from the departments, Ryan said they did so with a heavy heart due to the limited amount of time left to present the budget in time to receive state and federal funds and to set the tax rate.
"I voted for the budget because I knew it was too late," he said.
In June, Fiorentini asked the City Council to raise water and wastewater rates, then rescinded the request due to opposition from the councilors.
Ryan said Fiorentini's push to raise rates just before the budget was finalized, is just another sign of the city's overreliance on the department's money for day-to-day operations.
"We're addicted like a drug addict," Ryan said. "We never meant it to go on forever."
Ryan said that close to a decade ago, during the term of former Mayor John Guerin, the City Council authorized the city to draw around $250,000 from the water and wastewater departments in order to balance the budget during a minor recession, but had never voted on a particular cut-off date.
"Now is the time to say to the mayor, 'No more,'" Ryan said. "It's his new form of taxation."
Macek said that while the enterprise fund can remain "an option on the table," he's more concerned with performing an audit to see where the city is spending money from the general fund.
"We're not going line item for line item," Macek said. "We're just asking for details on the justification of these charges."
Ward said he'd be fine with an audit of his departments.
"To me, 'audit' isn't a dirty word," he said. "I think it's a good check and balance."
Despite the mayor's failed attempt at increasing rates, the city's water and wastewater bills went up 5 cents in July as a result of improvements to the water system that had been approved three years ago.
