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New
water
authority
guarantees
funding
to
rebuild
regional
system
and to
assist
customers
in need
•
Detroit
will
lease
infrastructure
to
suburban
communities
in
exchange
for $50
million
annual
fee,
annual
$4.5
million
payment
assistance
fund
DETROIT
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A
historic
deal has
been
reached
between
the
Mayor of
the City
of
Detroit,
the
Chief
Executives
of
Wayne,
Oakland
and
Macomb
counties
and the
Governor
to
create
the
Great
Lakes
Water
Authority
(GLWA)
to
manage
water
and
sewer
operations
in the
tri-county
area.
The
agreement
lays a
foundation
for a
more
financially
stable
system,
an
opportunity
to
create
efficiencies
to
better
control
rates
and
greater
transparency.
Each of
the
officials
emphasized
that
while
this is
a
critical
first
step,
there is
still
much
work to
do,
including
approval
by the
governing
bodies
of the
counties
and the
city.
The deal
continues
Detroit’s
ownership
of its
assets
while
providing
suburban
communities
a
greater
voice in
the
operation
of the
regional
system.
The
agreement
also
guarantees
funding
to
rebuild
the
system’s
aging
water
infrastructure,
as well
as
financial
assistance
for
customers
throughout
the
region
who are
struggling
to pay
their
bills.
The
annual
revenue
required
rate
increases
charged
by GLWA
are
expected
to be
limited
to 4% a
year for
the next
10
years.
Governance
The
regional
authority
will be
governed
by a
board
made up
of two
members
appointed
by the
Mayor of
Detroit
and one
appointed
from
each
from
Wayne,
Oakland
and
Macomb
Counties
and the
Governor.
Major
decisions,
such as
rate
increases,
will
require
five of
the six
votes to
be
approved.
In order
for the
provisions
of the
agreement
to take
effect,
Detroit
City
Council
and at
least
one of
the
counties
must
approve
the
creation
of the
Great
Lakes
Regional
Water
Authority.
If the
authority
is not
approved,
the
Emergency
Manager
could
make a
decision
himself
on the
fate of
DWSD and
could
hand it
over to
a third
party.
Currently,
the
Detroit
Department
of Water
&
Sewerage
department
manages
two
distinct
systems.
First is
a
regional
system
of
approximately
640
miles of
large
water
and
sewer
pipes
that
serve
127
communities
in
Wayne,
Oakland
and
Macomb
counties.
This
regional
system
also
includes
five
water
treatment
facilities
and a
major
sewage
treatment
plant.
Local
communities
are
responsible
for
their
own
local
water/sewer
system
and the
billing
and
collections
system
for
their
residents.
The
Detroit
water
and
sewer
system
consists
of more
than
3,400
miles of
local
water
mains,
3,000
miles of
local
sewer
pipes,
27,000
fire
hydrants
and an
extensive
billing
and
collection
system.
Of the
1,400
DWSD
employees
today,
it is
expected
that
approximately
500 will
remain
working
at DWSD
on
Detroit’s
local
system
and
approximately
900 will
transfer
to the
GLWA to
run the
regional
system.
GLWA
will
honor
all
collective
bargaining
agreements
of DWSD
employees.
Funding
to
replace
broken
mains
If the
new
authority
is
established,
the city
of
Detroit
will
retain
ownership
of its
3,000
miles of
local
pipes
and
lease
its 300
miles of
suburban
pipes to
the
local
communities
in which
they are
located.
Five
water
treatment
facilities
also
would be
operated
by the
Regional
Authority.
In
exchange
for the
use of
its
assets,
suburban
communities
will pay
the city
of
Detroit
$50
million
per year
for the
next 40
years.
This
will
allow
Detroit
to
finance
up to
$500-800
million
in bonds
to
rebuild
the
city’s
aged
water
and
sewer
system.
The
majority
of the
city’s
water
mains
are
between
70 and
90 years
old and
failing
at a
rapid
rate.
Detroiters
have
suffered
through
more
than
5,000
water
main
breaks
in just
the last
3 years.
Rebuilding
1% (30
miles)
of its
system
each
year at
a cost
of about
$25
million
would
have put
the city
on par
with the
national
average.
However,
DWSD has
spent no
more
than
$3.4
million
in each
of the
last
three
years to
rebuild
its
mains.
Dedicated
assistance
to help
customers
struggling
to pay
bills
The
agreement
creates
for the
first
time a
fund
dedicated
to
providing
financial
assistance
to water
customers
in
throughout
the
region
who are
struggling
to pay
their
water
bill.
The fund
-
established
at $4.5
million
- will
be
replenished
annually.
Today,
DWSD
sets
aside
only
$168,000
annually
to
assist
its
customers.
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