Berlin Charrette

Berlin, Worcester County
Maryland

Town Background

Berlin is a town of 2,616 residents situated in Worcester County on Maryland's Eastern Shore. The town is fifteen minutes from Ocean City, a major summer resort on the Atlantic, and is also near Assateague Island, a pristine barrier island park available for camping.

Berlin began as a small village that grew from an original 300-acre land grant in 1677, called the "Burley Plantation." The town's Main Street was originally a path connecting the Assateague Indians with the neighboring Pocomoke tribe. In colonial times, the path became the Philadelphia Post Road, the main travel route up the Eastern Shore. In the 1900s, Berlin supported an active tourist trade and boasted more hotels than Ocean City. Today, Berlin is a sharp contrast to Ocean City's dense development, with its rows of high rises and traffic problems. Berlin has preserved nearly two centuries of architectural heritage from the Federal and Victorian periods-and it has retained a peaceful, small town atmosphere.

The proximity of Ocean City provides plentiful employment opportunities. In addition, there are such in-town employers as a Purdue Chicken processing plant and a Hudson Food processing plant. The local tourist trade provides jobs, and recently, the town was chosen as the site of the new nonprofit Worcester Memorial Hospital.

Extensive construction and renovation is evident throughout the town. There has been significant private investment from state agencies and local individuals-in particular, one politically active, wealthy citizen, who has galvanized much of the investment effort.

The Issue

Developers have been very active in Berlin. Currently, a 41 unit subdivision of single family detached homes has been approved, as has a 15 unit commercial development that is a direct result of the hospital. Planned development includes a 32 unit multi-family development, a 30 unit high/middle income single family subdivision, and a large Food Lion shopping center.

Unfortunately, all of this development will shortly grind to a halt if action is not taken to address a serious infrastructure issue: the need for expanded capacity in its waste water treatment system-the town is currently in violation of its discharge permit. The town currently operates a 600,000 gallon per day (gpd) waste treatment facility that discharges treated effluent into the Trout Creek, a tributary of the Pocomoke River, which is a shallow river in the Chesapeake Bay watershed.

Environmental Context

Because the river is shallow, and because two other large towns already discharge into the river, Maryland's Department of the Environment has refused to let Berlin continue to discharge into the Trout Creek or the Pocomoke River. In fact Worcester County has refused to allow any more discharges into any of the county's rivers or creeks. Discharge into the Atlantic Ocean is prohibited.

This has forced Berlin to consider a waste treatment system that sends treated effluent through 9 miles of pipe to a 1.5 square mile spray irrigation field, where the effluent is sprayed across a field and is absorbed by grasses and other vegetation. This system will cost the town $16 million ($6 million plant upgrade and $10 million for the pipes and field preparation).

Project Financing

Berlin's debt to assessable base ratio is a hefty 15.3% while debt issued represents about 91% of that authorized. A number of grants have been secured which is about 87% of total project costs. All grant sources have been explored-this leaves a $2.1 million shortfall of funds in order to complete the project. Although tap fees for water and sewer hook-up fees for sewer for new units may reduce this gap, the treatment facilities must be built before the units are in place and the fees can be collected.

Recommendations and Observations

1. Examine the possibilities of "pay-as-you-go" growth, where development fronts the capital costs of expansion and recoups their costs later, with interest, from the unit purchaser.

2. The town currently charges a flat monthly sewer and water fee, although an actual usage fee based on a new metering system is planned. Consider a minimum monthly charge per customer which would include a basic billing and administrative fee for operating the system, plus a variable fee which would represent the cost of debt service per customer. Conservation of water might allow the present treatment system to continue to operate within its permit parameters until such time as enough capital can be identified to complete the project.

3. Investigate whether the spray irrigation field might be designated as a receiving area for wetland mitigation credits from developers in the area-developers could "purchase" wetland credits from the town in satisfaction of mitigation requirements, thereby providing front-end capital for the project.