Facing the prospect of having to raise Riverhead sewer district rates as much as 400 percent to cover the $24 million cost of upgrading its wastewater treatment facility, Riverhead Town is about to make a $2 million demand for a share of Suffolk County’s sewer stabilization fund.
The town is prepared to go to court to collect, if necessary, Riverhead Town Supervisor Sean Walter said.
Board members are expected to approve a resolution tonight authorizing the filing of a formal notice of claim against the county.
The town previously wrote to the county to request the payment more than $2 million payment for 2016 and 2017, but got no response, Walter said.
A special state tax law provision allows the county to collect a sales tax of one-quarter of 1 percent for the purpose of stabilizing assessments and sewer rates in sewer districts established in the county, including town and village sewer districts.
The law gives the county executive and county legislature discretion to determine the amounts to be distributed for assessment and rate stabilization purposes.
“The county has never promulgated rules for how the sewer stabilization fund should be distributed, or even how claims for the funds can be made,” Walter said.
“So it’s basically on a whim,” he said. “The county has always given us stabilization funds,” he said, “but always on a whim.”
The county legislature determined that stabilization funds should be used to limit the annual assessment or sewer district tax increase to a maximum of 3 percent, according to the town.
The money claimed by Riverhead Town would meet that standard, Walter said.
“It’s a question of fairness,” he said.
Sewer stabilization fund was set up to do exactly what we want to do and it’s doing that for county sewer districts, he said.
“The county should treat the town’s sewer district the same as it treats the county sewer districts,” according to the supervisor.
The town this year kept sewer rates stable by applying the district’s fund balance. Without the fund balance sewer rates would have more than doubled in 2016, Walter said.
Walter noted that the Riverhead sewer district includes large county facilities and handles wastewater from the county jail and county center in Riverside.
A spokesperson for the county executive declined comment because of the prospect of litigation by the town against the county.
“We would like to point out that the county provided the town with an $8 million grant for the sewage treatment plant upgrade,” said county spokesperson Vanessa Baird-Streeter.
“It’s more than fair [for Riverhead] to ask for sewer stabilization money,” County Legislator Al Krupski said.
“We spend an awful lot of money on the west end sewer districts,” he said.
“And one-third of [Riverhead’s] flow is from the jail and county center.”