Laundry company files suit over NPU water, sewer rate increases

Norwich — The commercial laundry company in the Norwich Business Park that had objected strongly to 9 percent sewer and 27 percent water rate increases filed suit Thursday against the city Sewer Authority, challenging the sewer rate hike.

ACLS Realty Holdings of New England LLC, one of the largest users in the Norwich Public Utilities sewer and water systems, is challenging the Sewer Authority’s vote on May 29 to raise rates by 9 percent starting July 1.

According to the lawsuit, the company now pays about $ 350,000 per year for the combined usage rates and the “mandatory upgrade charge” the authority enacted in 2010 to pay for upgrades to the sewer treatment plant. The company estimated the new rate hike would cost an additional $40,000 per year.

Attorney Glenn Carberry, representing ACLS, said Thursday the company is evaluating whether to file an additional lawsuit challenging the water rate increase.

Carberry said he is hoping the Sewer Authority, NPU officials and city officials become more aware of how the new rates are harming local businesses and residents and consider alternatives to those rates.

NPU spokesman Michael Hughes said the authority and NPU officials would not comment on pending litigation.

In the lawsuit, Carberry argued that the rates “do not constitute fair and reasonable charges,” and that as one of the largest customers, ACLS is bearing a disproportionate share of the cost of operating and maintaining the sewer system. He said the new rates also are excessive when compared to rates in other communities.

The suit asks that the rates be reduced to reflect “a fair and reasonable rate.”

Carberry also argued that the Sewer Authority set the rate “for the sole purpose of building an excessive cash balance” rather than to operate the system.

He said the authority also did not follow proper procedures when it reviewed information from NPU officials and approved the rates. The authority held a public hearing on April 24 on what was then a proposed 11.5 percent sewer rate increase. The authority discussed the proposed rate increase again on May 22, but delayed action.

The authority then held a special meeting on May 29 to review new information from NPU officials and then voted on the 9 percent rate increase. Carberry said that the authority did not allow public comment or response on the new information before voting on the rate increase. c.bessette@theday.com