Detroit— The proposed creation of a Metro Detroit regional water authority drew the ire of the elected leaders of Macomb and Oakland counties Thursday as they appeared for the first time with Detroit’s new mayor, Mike Duggan, at a Detroit Economic Club forum.
But the initiative gained support from Wayne County Executive Robert Ficano even as Oakland County’s L. Brooks Patterson and Macomb County’s Mark Hackel argued the authority would result in much higher water rates for residents.
Although Detroit owns and operates the Detroit Water and Sewerage Department, Emergency Manager Kevyn Orr is promoting a regional authority in which the counties would participate and provide a payment to help the city whittle down an estimated $18 billion in debt and emerge from bankruptcy.
Orr plans to strip “Detroit” from the department’s name and refinance the operation’s debt under more favorable interest rates afforded by having the three counties on board. County executives criticized his hope to hammer out a deal with the counties in two weeks.
“I’m pretty resentful when Orr comes in … and says we have to do this in two weeks,” Patterson said. “This system has been dying for 10 years. ... It’s not going to happen in two weeks.”
Hackel agreed, saying the result for homeowners will not be pretty.
“If you don’t think that your rates are going to go up, no matter what happens, you are sorely mistaken,” he said.
A regional authority would mean higher water costs for homeowners, Patterson said, because the Detroit system has deferred maintenance issues for decades.
The authority idea received support from Ficano, who argued ratepayers were bound to bear the brunt of a rate increase regardless of the Detroit department’s organization.
In addition, the department would benefit financially from the inclusion of Macomb, Oakland and Wayne counties, he said.
“If you’re able to set up an authority … bonding will change under the authority,” Ficano said. Bond ratings would be higher since the grades would not be tied solely to Detroit’s financial status — resulting in lower lending charges for the city, he said.