WASHINGTON – A federal appeals court has ruled that Chesapeake Ranch Water Co. cannot prevent Calvert County from providing water service to two new developments adjacent to water company’s service area.
A three-judge panel of the 4th U.S. Court of Appeals on Wednesday upheld a lower court ruling against the nonprofit water company.
The company had argued that the county’s plan to extend service to Lusby Town Center and Patuxent Business Park would violate the Consolidated Farm and Rural Development Act of 1961 by curtailing its water service.
The county countered that the water company was seeking to “send off any competition” and gain a monopoly in the area.
“The absurdity that they have a right to expand in a limitless fashion demonstrated the incorrectness of the interpretation of the statute,” said Jefferson Wright, who represented the county in the case.
But George Hanson, general manager of Chesapeake Ranch, said the nonprofit utility only wanted to protect supplies for its 10,000 clients in Chesapeake Ranch Estates in southern Calvert County. It has provided water service there since 1960.
“Our original intent was to defend our water supply,” said Hanson.
The company sued after the county applied for a permit to drill a well near Chesapeake Ranch’s water supply. Hanson said a study found that the county’s proposal would cause depletion in his company’s water supplies, possibly having “an immediate hit” of 25 percent.
But County Attorney Emanuel Demedis noted that the drilling permit has not been granted. Besides, he said, the aquifer from which Chesapeake Ranch draws its water does not belong to the water company, but runs under Maryland and Delaware.
“It’s not their water,” Demedis said. “For the Ranch to think that it is exclusively theirs is absurd.”
The court concurred with the defense argument that ruling in favor of Chesapeake Ranch would create a “kudzu vine” that would let utility companies expand at their own whim and will.
But Hanson said that it was it “unnecessary” for the county to construct a water system with “taxpayer dollars and investment and capital,” especially when his company already had the infrastructure in place.
Chesapeake Ranch argued that it already had made available water service to Lusby Town Center and Patuxent Business Park. But the appeals court disagreed, saying the two developments were adjacent to, not within, the water company’s existing franchise area.
Hanson said his company has filed other suits aimed at protecting its water supply from “predatory government.” Those suits — against the county and the state Environment Department, and against the county and the state Agriculture Department — are still pending.
“If courts continue to find that these rural, water systems can’t be allowed to grow . . . these systems will be considered bad investments by everybody,” Hanson said. “There will be a reduction in the ability of rural people to survive.”
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