03/28/2026
Town of Lonaconing – Water System Update and Rate Resolutions
In recent days, customers of the Lonaconing Water Company have raised questions regarding the outstanding balance owed to Allegany County, as well as the public notices for Resolution No. 2026-01 and Resolution No. 2026-02, which propose modifications to water rates.
Since January 2023, Allegany County has billed the Town a total of $1,205,268.90 for water services. To date, the Town has paid $648,273.76, leaving an outstanding balance of $556,995.14.
The Lonaconing Water Company’s estimated income was $1,019,476.00 in 2023 and $1,065,244.00 in 2024. These funds support essential operations including line repairs, meter replacements, project repayment, payroll, plant operations, and billing systems. The Town’s full budget is available to the public upon request or online at townoflonaconing.org under Meetings and Agendas.
Background on Increased Costs
In January 2023, the Town experienced a water emergency that required purchasing water from Frostburg, billed through Allegany County. At that time, the Town was paying $23,420.40 per month to Miller Environmental, a third-party operator responsible for water treatment operations. That contract ended in January 2023.
Due to state licensing requirements, the Town was required to contract with Maryland Environmental Service (MES) to maintain the distribution system while also purchasing water externally. As a result, costs increased significantly.
For example, in February 2023:
Allegany County billed $35,290.87
MES billed $35,998.30
This represented an increase of approximately $47,900 above expected monthly costs. These elevated expenses continued through January 2025 while the Town remained dependent on purchased water.
On average during this period:
Allegany County billed approximately $42,425 per month
MES billed approximately $12,400 per month
This resulted in an average increase of $31,404.60 per month above prior operating costs. While the Town covered these increases for as long as possible, the sustained deficit ultimately led to the current outstanding balance.
Why the Balance Exists
The Town has made payments to the extent that budget allowed. In 2023 alone, the water system budget anticipated $281,044.80 in third-party operational costs, but actual costs from Allegany County and MES totaled $530,249.53.
These additional costs were not passed on to customers during that time. The Mayor and Council has consistently maintained that residents should not bear the burden of third-party operational failures.
Rate adjustments implemented in 2024 and 2025 addressed general operating cost increases, but did not account for the accumulated deficit.
Proposed Rate Adjustments
Resolution No. 2026-01 and Resolution No. 2026-02 propose modest adjustments to water rates:
*Resolution No. 2026-01: Adds a $6 quarterly operations and maintenance fee per customer ($24 annually)
*Resolution No. 2026-02: Increases usage rates by $0.15 per 1,000 gallons, resulting in an estimated $1.65 quarterly increase for the average customer ($6.60 annually)
Combined, these measures are expected to generate approximately $36,500 annually to help offset rising operational costs.
Customers are not being asked to pay for the existing debt owed to Allegany County.
These resolutions will be introduced at the April 6, 2026 public meeting. They will also be discussed at meetings on May 4 and June 1, where public comment will be accepted. Drafts were initially made available at the March 2, 2026 meeting.
All supporting documentation—including invoices, payments, and financial records—is available for public review. Paper copies can be obtained but may included processing costs depending on document request. Residents may request this information by calling Town Hall at 301-463-6266 or visiting in person at 35 E Main Street, Lonaconing, MD, Monday through Friday from 9:00 AM to 5:00 PM.
Water quality testing continues to be conducted daily, weekly, and monthly in compliance with Maryland Department of the Environment (MDE) standards. Test results are available upon request.
