Hamilton Township has filed a multi-million dollar lawsuit against Robbinsville, the latest twist in a months-long saga surrounding the regional sewer authority shared by the municipalities.
Hamilton announced the litigation Aug. 26, one week after Hamilton Mayor Kelly Yaede’s administration came under fire for appearing to backtrack on a study to analyze the finances of the township sewer department. The Aug. 20 announcement that Hamilton would not agree to an independent sewer rate study shocked involved parties in Hamilton and Robbinsville, and raised questions about why the administration would not want it. These questions were the “final straw,” Hamilton Township business administrator Dave Kenny said in a township press release.
The lawsuit filed with the Mercer County Superior Court seeks $2.8 million from Robbinsville, an amount the Yaede administration says its neighbor has not paid for increased usage of Hamilton’s sewer system. For months, Yaede has claimed that Robbinsville owes Hamilton’s sewer utility a seven-figure sum, but has been inconsistent in the exact amount, recently increasing the debt from $1 million to $2.8 million. She said in an interview with the Hamilton Post Aug. 22 that Robbinsville’s usage of the system has increased, from 15.9 percent in 2016 to 19 percent thus far in 2019.
Fried said he has seen spreadsheets and press releases claiming his township owes Hamilton seven figures but never an actual, official invoice for the amount.
“I’m feeling very confident saying that the mayor is not being truthful,” Fried said.
Hamilton council president Jeff Martin said Yaede and her administration have never presented Hamilton Township council with documentation or proof that Robbinsville owes anything either. Martin is Yaede’s opponent for mayor in this November’s election.
“This goes back to why we wanted the rate study,” Martin said. “It’s so we could actually see a calculation.”
The study would review the usage of the township’s sewer system and the financial health of Hamilton’s Department of Water Pollution Control. The resulting data would project the next 10 years of the sewer system, and could potentially be used to put to rest long-lasting disputes between Hamilton Township council, the Hamilton administration and the government in Robbinsville, which uses Hamilton’s sewer plant and system.
Yaede claims she and her administration have never supported such a study, despite public comments to the contrary.
“I have never supported a rate study,” the Republican mayor said. “In a public meeting, Dave [Kenny] said he believed we’d be open to it. He never committed to it.”
But a video obtained by the Hamilton Post shows Yaede is only half-right. While Yaede has never made a statement publicly supporting a rate study, three officials from her administration—including Kenny—said during a May 14 budget meeting with township council that they wanted the study or otherwise intended to begin the process of obtaining one.
In fact, the suggestion for a rate study originates from a Hamilton administration official, acting chief financial officer Phil Del Turco. The third official in the meeting was Water Pollution Control director Carrie Feuer, who also appeared to support the study.
At the end of the five-minute video, Del Turco shares his appreciation for council’s enthusiasm for a rate study, saying the Glen Gilmore administration ignored his suggestion for a similar analysis a decade ago, when he served as CFO for the Democratic mayor.
“In 2006, it fell on deaf ears,” he said.
Martin, a Democrat, assured Del Turco council supported him in the effort.
“It’s a non-partisan issue,” Martin said in the video. “We’re all on board.”
The “we” includes the council and the administration in Robbinsville Township, which took the rate study so seriously that Robbinsville’s government even offered to foot half of the $30,000 bill despite its residents accounting for less than 20 percent of the sewer system’s usage.
In May, the Yaede administration took official steps to cover its half, altering its sewer budget to add $15,000 to the line item entitled “Auditing.”
The rate study, in theory, would clear up the dispute about how much Robbinsville should be paying into Hamilton’s sewer system.
But Yaede said, in an interview with the Hamilton Post Aug. 22, that a rate study would do no good because it would take too long, and would not “break out” what Robbinsville owes for past usage. She alleges it’s merely a stall tactic by her township’s council.
“There’s only one question to be answered: why is the Hamilton Township council delaying the payment from Robbinsville yet again?” Yaede said. “There have been a plethora of meetings and calls…In a year I cut taxes, why is the Hamilton Township council stalling?”
Yaede’s opposition to the rate study has drawn suspicion from officials and residents in both towns, particularly because there have been questions about the finances of Hamilton’s Department of Water Pollution Control for months. The initial budget for WPC submitted to Hamilton council contained a handful of curious line items, including a 50-percent reduction for electricity at the treatment plant and a 40-percent decrease for the disposal of sludge, the solid byproduct of treating sewer waste.
During a budget workshop in April, Martin raised these issues, asking Feuer, the WPC director, why the line item for electricity changed from $400,000 to $200,000, even though the treatment plant spent $367,000 on electricity in 2018.
“Are we gonna spend 200?” Feuer responded. “Oh yeah, we’re gonna go right by that.”
Feuer added later in the meeting that there was “no way” WPC could decrease the amount of sludge by 40 percent to match the cut in disposal budget. She also expressed concern about how little wiggle room she had in the budget.
“If you come into the red, you’re going to be fired…Is it too close for me?” Feuer said. “Yes, it’s too close for me because I don’t want to come in in the red.”
During the May 14 meeting meant to clear up questions with the sewer budget, Del Turco admitted the budget had distressingly little surplus.
“It’s going to be tight,” he said.
On Facebook, Hamilton Township CFO John Barrett suggested the administration might be concealing something. Barrett has been a vocal critic of the Yaede administration since it suspended him in January for what it said was an abuse of sick time.
“A rate study would expose the sewer utility as being insolvent and in need of a huge residential increase right before the November election,” Barrett wrote Aug. 22. “This increase was scheduled to happen in 2017, but Yaede directed [former business administrator John] Ricci not to execute the plan.”
Fried said he is concerned about the possibility of a shortfall or insolvency, particularly because any financial problems with the sewer division could cost Robbinsville and its sewer ratepayers hundreds of thousands of dollars.
“We shouldn’t be playing games with a sewer authority,” Fried said. “It’s a big deal. I don’t think Hamilton is taking it seriously.”
Despite the animosity, Fried said he isn’t looking to end the joint sewer agreement Robbinsville has had with Hamilton since 1976. Robbinsville had previously considered building its own treatment plant off Line Road, and Yaede has all but dared Fried to make a move.
“We have heard every excuse, from phony bills to the need for committees, with which we have obliged,” Yaede said. “If he thinks we are so far off with the flow calculation, then he can meet with us at DEP and immediately get out of our water system.”
Fried said leaving Hamilton isn’t an option, due to the amount of infrastructure and money Robbinsville has tied up in Hamilton’s system.
“I’m not 100 percent sure the state will allow us to pull out, and do sewer on our end or join another authority,” Fried said. “I don’t think the DEP would allow it. I don’t think the DCA would allow it. And I don’t think Hamilton could legitimately afford it.”