The city of Falls Church has announced it has discontinued negotiations with Fairfax Water to merge the city’s and county’s water supply systems.

The two entities have been locked in a multi-year battle — in and out of court — regarding a multitude of issues surrounding the city’s water system.

In the most recent development, Falls Church had been considering selling its water system; Fairfax Water proposed a merger in lieu of a sale.

The city then was told selling its water rights to an investor-owned utility company would not be allowed under its contract with its supplier, the Army Corps of Engineers’ Washington Aqueduct, leaving Fairfax Water the only potential suitor for the city water system.

According to Falls Church officials, city and county representatives met three times in July to discuss a possible sale. However, the city was unhappy with the terms of a potential merger that, according to public records, did not include a cash payment to the city.

“The goal was to explore the possibility of a sale agreement that would benefit City taxpayers and all of the customers of the water system. We did not reach such an agreement and we are happy to continue to provide vital public water services to the City and County, as we have for over 80 years,” Falls Church Mayor Nader Baroukh said in a statement.

In a statement posted to its website, Fairfax Water indicated it regrets that “earnest efforts to negotiate an agreement were unsuccessful.”

Falls Church also indicated it would continue to fight the Fairfax County’s utility rate control ordinance, which was supposed to go into effect this year and would require county approval for Falls Church to charge a higher rate than Fairfax Water.

Fairfax County and Fairfax Water have filed a motion to dismiss Falls Church’s lawsuit.

Fairfax Water serves about 1.7 million people in Fairfax, Loudoun and Prince William counties, and the city of Alexandria. Its basic rates are $2.16 or $2.31 per 1,000 gallons, but it charges higher connection fees than does Falls Church.

Falls Church charges $3.27 per 1,000 gallons. Its customer base includes the Falls Church and portions of McLean, Merrifield and Tysons Corner in Fairfax County.

kschumitz@fairfaxtimes.com