Opinion
10-19-2015
GSP MANAGEMENT COMPANY, Appellant v. DUNCANSVILLE MUNICIPAL AUTHORITY.
Daniel F. Schranghamer, Williamsport, for appellant. Douglas J. Keating, Altoona, for appellee.
Daniel F. Schranghamer, Williamsport, for appellant.
Douglas J. Keating, Altoona, for appellee.
Opinion
OPINION BY Judge BROBSON.
By order of December 28, 2014, the Court of Common Pleas of Blair County (trial court) rejected the challenge of Appellant GSP Management Company (GSP) under Section 5607(d)(9) of the Municipality Authorities Act (Act), 53 Pa.C.S. § 5607(d)(9), to the sewage rate scheme of the Duncansville Municipal Authority (Authority). This section authorizes municipal authorities to establish “reasonable and uniform rates” for the services that they provide. Section 5607(d)(9) of the Act. The section also expressly authorizes suits against a municipality to challenge the reasonableness and uniformity of established rates. In its suit, GSP, by way of a declaratory judgment action, challenged the Authority's rate scheme both on its face (Count I) and as applied to GSP (Count II). (Reproduced Record (R.R.) 32a.) For the reasons set forth below, we affirm the trial court's rejection of the facial challenge, but we reverse the trial court's rejection of GSP's as applied challenge and remand the matter to the trial court for further proceedings.
The trial court resolved the parties' dispute in reliance on a Joint Stipulation of Facts (Stipulation). (R.R. 47a–53a.) According to the Stipulation, GSP operates a mobile home park in Allegheny Township, Blair County, known as Lehigh Terrace Mobile Home Park (Lehigh Terrace). The Authority does not provide water and sewer service directly to residents in Lehigh Terrace; rather, Lehigh Terrace maintains its own internal water distribution and sewage collection and conveyance systems. The Authority meters the water that it provides to Lehigh Terrace, but it does not meter the wastewater discharged from the mobile home park into the Authority's sewer system.
In June 2009, the Authority informed GSP of its adoption of a new “Sewer Rate Structure Based on Water Meter Readings—High End Users” (New Rate Structure). The New Rate Structure provides for the calculation of a sewer bill based on tiered sewer rates, where the rate increases on a sliding scale corresponding to the amount of metered water supplied to the customer. As the customer's metered water increases through particular bands, so too does the assessed sewer rate and, consequently, the customer's sewer bill. The Authority's New Rate Structure does not expressly provide for an allowance where a customer encounters extreme deviations in the amount of its sewer bills based on water leaks between the point where the water is metered and where water is accessed by the customer or, in the case of Lehigh Terrace, the resident. There is no dispute that metered water orphaned by a leak in the internal Lehigh Terrace system is consequently not used by Lehigh Terrace residents and thus is never discharged into the Authority's sewer system. Since implementation of the New Rate Structure, the Authority has historically billed Lehigh Terrace for approximately 40,000 gallons of water a month and, consequently, approximately 40,000 gallons of sewage a month. Lehigh Terrace's highest metered water flow during a month in which it did not experience any leaks in its internal water distribution system was approximately 60,000 gallons.
Lehigh Terrace experienced significant leaks in its internal water distribution system on several occasions during 2009 and 2011. In June and July 2009, as a result of the leaks, metered water flow into Lehigh Terrace increased to 130,000 gallons and 220,000 gallons, respectively. In March 2011, again due to leaks, the metered flow into Lehigh Terrace was 110,000 gallons. Lehigh Terrace experienced leaks again in August, September, October, and November of 2011, with corresponding metered flow into the property of 120,000; 330,000; 580,000; and 210,000 gallons, respectively. During each of these months, despite the increase in metered water flowing into Lehigh Terrace, there was no corresponding increase in outflow of sewage from Lehigh Terrace into the Authority's sewage system. In other words, water consumption by Lehigh Terrace residents stayed relatively stable, as did their discharged waste water; the excess metered water was attributable to the leaks, lost somewhere in the conveyance of the water from the meter point to the residents due to leaks in the Lehigh Terrace distribution system. Once Lehigh Terrace repaired the leaks, metered flow returned to its historic average (approximately 40,000 gallons a month).
The Authority has an unwritten policy of making allowances for those that have experienced uniquely high water and sewer bills, but only where a malfunction in the customer's water meter is established. In such cases, the bills will be adjusted. Where, however, the high water and sewer bills are the result of leaks after the point of the meter and within the customer's property, the Authority will permit an installment payment plan, but it will not adjust the sewage bill.
Under the Rate Structure, and using Lehigh Terrace's average monthly water consumption with no leaks of 40,000 gallons, Lehigh Terrace's monthly sewer bill would be $753.00. The monthly sewer bill based on 60,000 gallons of metered water, Lehigh Terrace's highest during a no leak month, would be $1,253.00. During the months where Lehigh Terrace's metered water spiked due to leaks in its internal distribution system, the Authority billed Lehigh Terrace the following amounts for sewer service: