Macomb County joins GLWA mutiny over disputed Highland Park debt
Mount Clemens — Several communities in two of Michigan's largest counties have pledged to withhold a portion of their water bills to the regional water authority as they protest their subsidies of disputed Highland Park water-related debt.
Four Macomb County communities — Sterling Heights, St. Clair Shores, Shelby Township and Macomb Township — on Wednesday joined a growing chorus of cities in western Wayne County voicing opposition to paying off $54 million in Highland Park arrearage to the Great Lakes Water Authority.
Macomb County leaders encouraged their counterparts in other communities to do the same. To date, Macomb County communities have paid $13.5 million connected to the Highland Park debt.
"Enough is enough," said Macomb County Executive Mark Hackel at a 45-minute Wednesday press conference.
The alleged debt in question stretches back to 2012, when Highland Park was forced to join the Detroit water system after years of environmental violations at its water plant.
Great Lakes Water Authority says Highland Park has paid only 1% of its water bill and 50% of its sewer bill over that time. Highland Park, meanwhile, says it was overcharged for years and cites a 2021 Wayne County Circuit Court ruling that says it does not owe money but is owed $1 million from Detroit.
Macomb County Public Works Commissioner Candice Miller viewed that case differently. "Highland Park, you are taking advantage of your neighbors, enabled by the courts," Miller said Wednesday.
Great Lakes Water Authority, which didn't respond for comment Wednesday, has said it needs the funds to operate, and that bad debt has to be spread among its remaining customers.
Which communities are rebelling
Earlier this month, 18 communities in western Wayne County voted to withhold their payments related to Highland Park's disputed debt and place them in escrow.
Miller asked communities in Macomb to follow suit and hold their funds in escrow "to show our goodwill."
Among the first will be Sterling Heights.
"We are going to stop the payments," Sterling Heights Mayor Michael Taylor said Wednesday.
Taylor and other leaders have urged Gov. Gretchen Whitmer's office to get involved. So far at the state level, the Michigan Treasury Department has only "encouraged" Highland Park and the Great Lakes Water Authority to seek a resolution.
"My message to Gov. Whitmer is, fix the damn Highland Park water problem," said Taylor, adapting Whitmer's 2018 campaign promise to "Fix the damn roads."
"We're going to follow the example of other communities in Macomb, and the western Wayne communities."
Taylor said Sterling Heights would've been slated to pay $350,000 next year toward the debt. "We could hire three additional police officers," he said about the money.
Next to the microphone stand at Wednesday's press conferences were two large printouts of what Macomb County communities had paid in to cover the alleged bad debt: $13.5 million as of now and $15 million by the end of the fiscal year that starts July 1.
"Can you imagine if we were able to spend that $15 million on roads and bridges?" Hackel said. "This is going to put pressure on Great Lakes Water Authority and their ability to function. We plead to the state to not take us up on this challenge."
Kip Walby, mayor of St. Clair Shores, said homeowners he meets "don't want to pay for a service they didn't receive."
Rick Stathakis, Shelby Township Supervisor, said the township board is expected to vote April 19 on a measure to formally withhold Highland Park-related funds.
"We are not paying that bill," said Stathakis, noting the township has paid about $1.2 million of the debt so far. "What we have here is theft. That's what it is. Let's call it what it is."
Frustration grows in Metro Detroit
Communities in Oakland County also have voiced frustration with the Highland Park debt but have not decided to withhold funds.
"We really need the state to step in," Oakland County Water Commissioner Jim Nash said this week. "It's something that we just need to take care of, and they're (Highland Park) not in any more of a position to do it than we are. The state ordered it. We need to have the state respond to this, in my mind."
Karen Mondora, director of public services for Farmington Hills, said the city is on the hook for $31,000 of the disputed debt in fiscal year 2023, which begins July 1. It has paid nearly $285,000 to date.
Brian Baker represents Macomb County on the GLWA board. It was his idea to send the letters from GLWA to its member communities, announcing how much each had paid toward retiring the alleged Highland Park debt and asking for the state's help resolving the issue. Baker estimated the Highland Park arrearage costs Macomb County homeowners $75 to $100 per year.
Highland Park has argued that water independence is its path forward. Between the cost of replacing old lead water lines and refurbishing its old plant, it would cost anywhere from $90 million to $100 million, Highland Park Water Director Damon Garrett has said.
Miller, the public works commissioner, questioned that plan.
"That building needs to be bulldozed. It can't be fixed," Miller said of the Highland Park water plant, which was decommissioned in 2012 due to cloudy water. "It doesn't make sense."
Highland Park City Administrator Cathy Square has argued that what doesn't make sense is remaining a GLWA customer. Not only did Highland Park have water independence for decades, prior to 2012, it had water rights to Lake St. Clair, Square noted.
"It is not cost-effective to stay on GLWA water," Square said.
Wayne Co. prepares more action
On Tuesday, the Wayne County Commission's Public Services Committee voted to send to the full board a resolution asking the commission to "expeditiously review the circumstances contributing to the pending Great Lakes Water Authority water and sewer rate increases."
The resolution says the commission should "consider alternative options to address the proposed rate increases, including possible amendment to the Articles of Incorporation of the Great Lakes Water Authority."
In the fiscal year that starts July 1, wholesale water rates, those charged to communities, will increase 3.7%, and sewer rates will rise 2.4%, according to the GLWA budget approved in February.
The motion was offered by Commissioners Terry Marecki, R-Livonia, who chairs the Public Services Committee, and Joseph Palamara, D-Grosse Ile Township.
At that meeting, the committee heard from Jordyn Sellek, executive director of the Conference of Western Wayne, whose leaders voted to withhold and escrow the Highland Park debt-related funds.
Although withholding money is a start, Sellek said, "legal recourse may be the only way" to resolve the debt.
A GLWA lawsuit filed late last year against Highland Park in the Michigan Court of Claims has been delayed.
"We think the state should be reimbursing our communities for the debts we have already paid," Sellek said.
In the Conference of Western Wayne, that's about $15 million.
Highland Park's defense
The committee also heard Highland Park's side from the city's water Director Damon Garrett.
Highland Park was overcharged for years, Garrett said, to the tune of roughly $13 million. He cited the 2021 Wayne County Circuit Court ruling in favor of the city.
GLWA maintains that Highland Park stopped making payments in April 2021. Garrett portrayed the non-payment differently, as a reaction to past overpayment.
A GLWA representative was not present at Tuesday's committee meeting.
"We are escrowing that because we believe that we were overcharged," Garrett said. "So we are invoicing them monthly that the payments should go against what we overpaid, the $13 million."