Timberline utilities placed in receivership

DAVIS — Timberline Four Seasons Utilities has been placed into receivership following an order this week in circuit court in Tucker County.

Judge Lynn Nelson’s order, issued during a hearing on Wednesday, appoints Canaan Valley Public Service District as the receiver, with the control and responsibility of Timberline Four Seasons Utilities water and sewer utility operations to remain with Canaan Valley Public Service District until further order of the court.

Canaan Valley Public Service District will “receive the monies, fees and assets of TFSU and … apply them to the debts, obligations and accounts of TFSU as are necessary,” the order states.

The order was sought by the state Public Service Commission, which stated “sufficient facts were brought before the Commission through testimony and exhibits filed at the hearing held on Dec. 13, 2018, to support a finding that CVPSD is uniquely qualified to carry out the responsibilities of the receivership of TFSU,” according to the order.

The order states that all 743 sewer customers and the 428 water customers of TFSU (according to the TFSU 2016 annual report), along with all assets, will be transferred to CVPSD.

Timberline’s owners, Frederick Herz and Ms. Tracy Edmonds Herz, were not present for the hearing Wednesday but it was stated that they will be delivered a copy of the order by the Tucker County Sheriff’s Department. The receivership was ordered to be in effect immediately upon announcement to the court.

The court also determined that it was necessary to order the current management of TFSU, its officers, directors, managers (including but not limited to Mr. and Mrs. Herz), their agents, assigns and employees, and all persons and affiliated entities acting in concert with them, to immediately deliver all business records, equipment, and supplies relating to the business of TFSU to the sheriff of Tucker County. This includes all ledgers and journals, including but not limited to the general ledgers, accounts, payable journals, accounts receivable journals, payroll journals, disbursements journals adjusting entries as well as all computer and billing software and any hard drives containing any records or information pertaining to TFSU. Along with ordering all of the assets and ledgers from TFSU it was also stated in the court that Mr. and Mrs. Herz are required to turn over all business records and any other items and assets of TFSU in their possession that are not already turned in to the sheriff’s office.

The Public Service Commission presented evidence against Timberline Four Seasons Utilities in an all-day hearing Dec. 13 at Canaan Valley Resort and Conference Center.

After receiving numerous and increasing complaints that included customers being required to boil water before using it; not having a licensed operator working for the utility; inconsistent billing of customers and affiliates; the utility’s phone being disconnected; payroll checks to staff being declined for insufficient funds; failure to collect the ordered repayment for improper affiliate transfers of cash; failure to satisfy multiple years of federal and state tax liabilities; and the utility not paying its bills, including to Canaan Valley Public Service District for sewage treatment, the Public Service Commission took significant steps to attempt to restore Timberline Four Season Utilities to a safe, adequate and reliable service.

Just a day before the December hearing, Frederick Herz was arrested after allegedly failing to pay taxes and was charged with 12 misdemeanor counts of failure to pay hotel/motel taxes.