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Summer water bills are coming out now. High volumes, unpaid bills and even greater sewer rate increases are resulting in much higher year-over-year water bills.
Brian Baker, Macomb representative on the Great Lakes Water Authority (GLWA), highlights the drivers of these costs and warns Macomb residents to keep a close watch on the water and sewer rate-making process.
“Our water system is a regional infrastructure system. The full activity of that system is factored into the costs so it’s important that we carefully examine what drives costs – and identify every possible source of savings,” said Brian Baker.
2016 bills are fighting a battle to control costs. A sizable component of the increases are a result of a $31 million debt and ongoing $400,000 monthly deficit from the city of Highland Park under the former DWSD system. Macomb continues to push the state for resolution to this issue, as the debt and agreement were an arrangement during State of Michigan emergency management of Highland Park. Mr. Baker also requested support from MACRO (The Macomb Area Communities for Regional Opportunities) to also send communication to the governor’s office for resolution to this immense cost burden to suburban customers of GLWA.
A second component to those increases is attributed to the rate structure implemented by GLWA. Macomb County was the only negative vote for this year’s rate structure.
Brian Baker stated, “My position is that savings to our customers should be realized whenever possible. This year we had an opportunity to realize some of the initial savings from increased efficiency moving from DWSD to GLWA and to offset the new $50 million lease payment to Detroit.” Without further savings we are looking at a potential 9% to 10% rate increase next year due to the loss of Genesee County as a water customer.”
The third driver of cost increases were local drain and sewer increases. The wholesale sewer rate increase from GLWA to Macomb County was only 0.7%. The retail rate increase from the Macomb Public Works office however was a six-fold multiplier to that increase.
“60 – 70% of a resident’s water bill is comprised of sewer charges. While the GLWA implemented a 0.7% increase, the Public Works mark-up was 4.3%. Over the past seven years, sewer rates from Macomb Public Works have risen more than 120%, accounting for the majority of rate increases to customers.”
Mr. Baker warned of needing to keep a watchful eye on the water system, rates and the condition of its infrastructure, “The condition of DWSD was not structurally or financially sound when the GLWA assumed control. Debt payments consume half of all water department revenues, which leaves very little for much-needed capital improvements in the system.” He stated further, “I cautioned that there would be significant increases this summer. The mistakes made in Flint are not only damaging to residents, but consuming a lot of State resources that are really needed across the entire water and sewer system.”
County Executive Mark Hackel, who appoints Mr. Baker to the GLWA, said that, “Brian is doing a tremendous job of watching out for Macomb County residents. He and I are still concerned about the $31 million of unpaid sewer bills from Highland Park, that especially in light of the tragedy in Flint, are being borne by the regional members of the GLWA, whereas this should be the responsibility of the State of Michigan.” Meanwhile, unpaid bills from Highland Park are increasing by $400,000 per month.
Brian Baker is the CFO of Sterling Heights and Macomb County appointment to the Great Lakes Water Authority. His term will be up for renewal in 2020. More information about Macomb’s efforts to control water and sewer rates be found at greatlakesblog.wordpress.com.