Oakland County Fights Detroit Water and Sewer Plan

Oakland County Fights Detroit Water and Sewer Plandinos02sidelogo3

(C. Proxmire, May 13, 2014)


As the City of Detroit struggles to restructure under bankruptcy, the issue of regional water management is in the forefront of the discussions. Oakland County leaders, including County Executive L. Brooks Patterson and Water Resources Commissioner Jim Nash are advocating for a system that protects the region. They filed a 40 page objection on May 12 to the most recent plan in in U.S. Bankruptcy Court today. The county’s seed026_annemarieyerksfiling said that Detroit’s plan of adjustment puts the Detroit Water & Sewerage Department (DWSD) and its city and suburban customers at risk fiscally and from potential infrastructure failures. As a result, the county has asked the bankruptcy court not to confirm the city’s plan.

“The City appears willing to engage in a game of chance, jeopardizing the DWSD, and thus the region, by putting the DWSD’s operations at risk. It does so by, among other things, stripping necessary funds from the water and sewer system at the expense of a healthy DWSD,” Oakland County said in its objection. “While the City has many needs to address, none can be more important than public health, safety, and welfare, including, the maintenance of a structurally and fiscally sound water and sewer system.”

Oakland County outlined numerous flaws in Detroit’s plan of adjustment with regard to DWSD, but summed them up in the conclusion of the objection:

“The Plan suffers from numerous legal and factual impediments to confirmation. …The financial condition of the DSWD remains questionable, at best, after the execution of the Plan. The assumptions in the Plan waterworkregarding necessary capital improvements, increased operating revenues, decreased operating costs, reduced costs of debt service, and monies to be available to fund its capital improvement needs are overly optimistic, in some cases inaccurate, and fail to consider capital market conditions and realities. Accordingly, the Plan is not feasible. Moreover, the Plan is not proposed in good faith and violates applicable law in several material respects.”

The DWSD is responsible for the water supply and the control and treatment of wastewater for residential, commercial, governmental, institutional and industrial customers at a retail level within the City. The DWSD also serves over 125 wholesale suburban customers, many of whom, in turn, service their own retail lori davis adcustomers. They serve an estimated four million residents, and it is one of the largest municipal water and sewage departments in the nation.

The filing states that “Notwithstanding its size and importance to the region, the DWSD has posted operating losses each year for the last seven (7) years, including, on average approximately $200 million a year loss for fiscal years ending 2009 – 2013, evidencing significant and recurring operational and/or fiscal mismanagement…Historically, the DWSD has a demonstrated pattern of ignoring and/or deferring much needed capital improvements. These capital improvements are needed to correct existing deficiencies and known problems. Failure to confront and resolve these infrastructure needs on a current basis dramatically increases theseed019_Cherie_Rolfe costs of future repairs.”

The filing calls upon the Bankruptcy Court to reject the plan in favor of a plan that includes adequate funding for the system. Oakland County also objects to taking money from the DWSD in order to pay for a settlement on a pension dispute, because water and sewer funds are legally obligated to go for water and sewer services.

Download the entire document at http://oaklandcounty115.com/wp-content/uploads/2014/05/4627-OC-Objection-to-POA.pdf.

More info on the DWSD, including videos of meetings and videos explaining the system, water rates, etc. can be found at http://www.dwsd.org.


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