Allentown appeals water rate decision

Court erred in allowing authority to change billing to monthly, city claims.

Allentown has filed an appeal in Superior Court challenging a September ruling that cleared the way for the Lehigh County Authority to increase water rates to city customers.

The appeal, filed in October, argues that Lehigh County Judge Doug Reichley erred when he denied the city’s request for an injunction barring LCA from switching to monthly billing.

LCA, which leases Allentown’s water and sewer system as part of a 50-year deal that netted the city $211.3 million, wanted to switch to monthly billing from a quarterly levy as a way to make more money. That move, which was delayed indefinitely due to legal wrangling between the city and the authority, would have increased the fixed rate LCA charges to customers by about $13 per month, or $156 per year.

Allentown officials argued the proposed billing change would cause “irreparable harm” to city residents.

In a 13-page opinion, Reichley denied the request to halt the water rate hike, stating that Allentown failed to prove that an injunction is necessary to prevent “immediate and irreparable harm” and also didn’t prove that greater injury would be suffered by the city if an injunction was not granted — both legal requirements for such an action.

He also said the city also failed to prove it has standing to pursue the lawsuit against LCA because taxpayers, not the city itself, would be harmed by a rate increase.

In their appeal to Superior Court, city officials argued that Reichley erred when he said Allentown did not have standing and in his ruling regarding the injunction.

In November, Superior Court issued an order requiring the city to argue why the case should remain there, rather than Commonwealth Court, which typically hears cases where the government is involved.

Allentown filed a response to the court’s order on Monday, according to the court docket. On Thursday, the court announced the case was being referred to a merits panel.

In mid-November, LCA’s board adopted both quarterly and monthly water and sewer rates that are included in the lease agreement and updated for 2019, said Liesel Gross, CEO of LCA.

The lease allows LCA to increase water rates annually based on the consumer price index. The authority is also allowed to charge a capital cost recovery charge.

“We have not made any announcements about the implementation of the monthly rates, pending additional discussion with the City of Allentown regarding a holistic resolution to the lease disputes,” said Gross said.

Allentown spokesman Mike Moore could not immediately be reached for comment.

eopilo@mcall.com Twitter @emilyopilo 610-820-6522