Tryon Estates wins water lawsuit against Columbus: Columbus to hold info session July 14, 15 for water customers

Published 5:23 pm Monday, July 6, 2015

ACTS Retirement-Life Communities, operators of Tryon Estates, was awarded nearly $950,000 in a lawsuit against the Town of Columbus regarding a change in water and sewer service billing that led to overcharging of fees to the 215-acre, 370-resident retirement development.

A suit was filed in Polk County Civil Superior Court on Feb 9, 2011. The decision was delivered by Special Superior Court Judge Jeffrey P. Hunt on June 13, 2015.

Tryon Estates opened just outside the Columbus city limits in Polk County in 1992. At the time, Columbus was the only entity available for Tryon Estates to receive water from, short of drilling wells. This remains true today.

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Tryon Estates measures water consumption through six on-site water meters. These meters measure water provided to: the manned gatehouse at the entrance, the irrigation system at the main entrance, the assisted living and skilled nursing facility, the bus and RV lot, 10 villas, and the main building.

The Town of Columbus originally classified all six of the Tryon Estates water meters as commercial. By billing Tryon Estates in this manner, the town billed the community under the same structure that it bills other commercial customers, such as hospitals, restaurants and hotels. Tryon Estates, in turn, received a bulk water discount.

For nearly 10 years this remained the case. In the summer of 2002, Columbus town council voted to reclassify two of the six meters located at Tryon Estates from commercial to residential. At the time of the reclassification in 2002, Jim Christopher, Mark Fagan and Becky Rome were serving on council, Joseph Case was mayor, and Glen Rhodes was town administrator, according to Columbus Town Clerk Devon Gosnell.

According to Hunt’s findings of fact filed June 13, ACTS was not notified of the reclassification, was not given a chance to provide input, and did not learn of the billing changes until it started receiving significantly higher monthly bills.

These two meters, now deemed residential meters, are known as the sixth meter and the villas meter.

The sixth meter provides service to the main building at Tryon Estates, where the community’s 276 apartments are located. Along with the apartments, the main building includes a 6,000 square foot commercial kitchen, dining rooms, café, satellite kitchen, 20,000-gallon swimming pool, exercise facility, housekeeping services, auditorium and administrative offices.

“Per the new billing practices … the Town treats the Sixth Meter as if it is 276 separate residential customers,” Hunt stated in his opinion.

“This practice ignores that a significant portion of the water and sewer services are used outside of the apartments,” Hunt continued.

According to Hunt, Tryon Estates became the only town water and sewer customer for whom the town classifies some of the customer’s meters as residential and some commercial, contrary to the town’s stated practice of classifying customers as either solely residential or commercial.

“The way the town bills for water and sewer service associated with the sixth meter essentially treats Tryon Estates’ main building like a subdivision of 276 homes,” said Hunt in his decision. “ACTS pays significantly more for the provision of water and sewer than other commercial customers would pay.”

According to Judge Hunt’s findings, the Town of Columbus made no effort to research water consumption at Tryon Estates.

“As a result, ACTS has been overbilled, and overpaid each billing period following the 2002 reclassification,” wrote Hunt.

In his ruling, Hunt found in favor of Tryon Estates in the amount of $947,813.27, representing overpayments made since February 2008 and interest. A three-year statute of limitation prevented further reparations.

“We continued to seek, and were hopeful to find a resolution, but we are pleased with the court’s decision,” said Corporate Director of Communications Michael Smith, spokesman for Tryon Estates. “We felt very strongly that the rates were unfair.”

The Town of Columbus is expected to appeal, as stated in a media release sent to the Bulletin on June 30.

“Judge Jeff Hunt, former DA for this judicial district, ruled on June 18, 2015 that Tryon Estates should be billed as one commercial user, and that the practice of billing each of the residential units in Tryon Estates as a separate unit (as it does with all other residential units in the Town) should be discontinued and that The Town should repay $947,813.27 in water fees to Tryon Estates. The Town disagrees with this ruling and will appeal,” stated the press release distributed by Gosnell.

“Unfortunately, as a result of the case we had to make adjustments, and we hate that,” said Columbus Town Manager Tim Barth. “The bills are going to go up, primarily for the business community, but we have to have a certain amount of revenue to operate our system and keep drinking water flowing.”

Mayor Eric McIntyre was out of town and attempts to reach him for comment were unsuccessful.

Town of Columbus press release in response to Hunt decision

On February 9, 2011, an ACTS retirement community, “Tryon Estates,” filed an action in Polk County Superior Court alleging that the Town’s water utility billing practice, which was implemented in June 2002, is unfair because Tryon Estates should be treated as one commercial user. However, Tryon Estates is a retirement facility that leases units to approximately 370 residents.

In an effort to treat all users equally, the Town instituted a policy in 2002 to charge a base water fee for every residential or commercial unit serviced. Under this policy, the Town’s water rate classification provides that multi-unit customers serviced by a master meter (such as apartments or townhouses) are charged the base fee for each unit serviced. The Town believes this practices means that all users, whether living in a single family residence, individually metered unit, or a single unit that receives its water through a master meter along with other units, are charged the same rates for water.

Unfortunately, Judge Jeff Hunt, former DA for this judicial district ruled on June 18, 2015 at Tryon Estates should be billed as one commercial user and that the practice of billing each of the residential units in Tryon Estates as a separate unit (as it does with all other residential units in the Town) should be discontinued and that The Town should repay $947,813.27 in water fees to Tryon Estates. The Town disagrees with this ruling and will appeal.

As a result of this Judgment, the Town of Columbus must change its water utility billing practices. Accordingly, all water utility users will likely experience a significant increase in their water utility rates. Additionally, the Town may be forced to implement an inclining water rate structure which charges users a higher per gallon rate for water as water consumption increase. The Town of Columbus will be hosting an information session for local businesses on the rate structure changes on Tuesday, July 14, 2015 and Wednesday, July 15, 2015 at 5:00 pm in the Town Council Chambers, located at 95 Walker Street. The Town will continue to do everything in its power to treat all of the users of its water and sewer system fairly while continuing to attempt to keep the cost of the water and waste water treatment it provides as low as possible.