TAPPED OUT IN DIAMONDHEAD: Businesses Are Told They Must Pay Thousands of Dollars for Water Service

By Ryan Lafontaine, The Sun Herald, Biloxi, Miss.

Feb. 6–DIAMONDHEAD — Doug Miller was just days from opening two new restaurants when the Diamondhead Water and Sewer District called with some harsh news: Miller owes $14,000 in so-called tapping fees.

Tapping fees are common, according to other local utility districts, but price tags in the tens of thousands seem endemic to Diamondhead, which is essentially a self-governing utility authority that has had the power to adopt ordinances, issue fines and disconnect services since President Reagan was in the White House.

For a small business or restaurant to open in Bay St. Louis or Waveland, the tapping fees would hardly approach $1,000, drastically smaller in two cities that carry the bulk of the commercial clout in Hancock County.

Residential fees are about $2,000 less in the two cities than in Diamondhead.

Miller and other restaurateurs say the fees are hampering Diamondhead’s economic recovery from Hurricane Katrina.

“There’s nothing being built here and I’m wanting to open two new restaurants,” Miller said. “But how’s anyone supposed to open any sort of business here when the water department wants to charge those types of fees?”

Tapping fees normally are paid on newly constructed buildings, but many of these business owners claim they are having to pay fees on existing buildings, which means previous tenants likely have already paid the fees and the water lines have already been tapped.

John Trimmer, who owns P’zazz Restaurant, an 8,000-square-foot eatery on Yacht Club Drive, has paid the district more than $16,000 in tapping fees for his space in an existing building.

“The district is double-dipping all over the place and you have to wonder when this is going to end,” Trimmer said. “We’re small businessmen and we’re trying to get places open and then all of a sudden we get hit with these fees, and (the district is) supposed to be helping rebuild this community.”

Tapping fees usually depend on several variables, including labor and material costs to tap the waterline, the building’s size and distance from the nearest public water main, and whether the business plans to operate 24/7.

When Casino Magic opened its 600-acre property in Bay St. Louis in 1992, the tapping fee was a fraction of what Miller, Trimmer and others owe on their small Diamondhead restaurants.

Even today, if a casino the same size were to open in a new location in the Bay, the tapping fee would be less than $5,000, plus any cost to the city, according to the Bay’s Department of Public Works.

“It’s not like I have a history of not paying my bills on time,” said Bill Lawler, who had to fork over $15,000 before he could open Lawler’s Bistro. “I guess this is why some people here call it the Diamondhead Water and Sewer Mafia.”

The Diamondhead Property Owners Association, which is the legislative arm of the private community, and the Hancock County Board of Supervisors have no authority to regulate the water and sewer district, according to a state law adopted in the 1980s. Supervisors appoint commissioners every four years to serve on the district’s board.

Mike Collard, the head of the district, did not return messages left Monday by the Sun Herald seeking comment on the fees, but the district did provide the newspaper with a one-page rate sheet.

According to the sheet, commercial businesses pay $500 or “the actual cost to connect, whichever is greatest,” for water. Sewerage fees are calculated using a “sewer rate ordinance.”

Last year, the district forced some residents to pour concrete into their personal wells to assure they would never work again. Locals installed the wells after Katrina, rather than waiting until December 2005 when the district finally restored water to their neighborhoods.

At the time, Collard did not return messages seeking comment on the water wells and when the Sun Herald reached him on his cell phone, he said, “I don’t know how you got this number, but don’t call it again.” The newspaper did not try reaching him through his cell phone Monday.

The peeved business owners are planning to voice their complaints at a district board meeting on Feb. 14 in the board’s conference room on Park Ten Lanes.

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Copyright (c) 2007, The Sun Herald, Biloxi, Miss.

Distributed by McClatchy-Tribune Business News.

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