Monday, January 4, 2010

To Help Price Water, Milwaukee Decides Against Consultants - - Delighting Waukesha's Consultants

When Milwaukee decided about a year ago to sell Lake Michigan water out of the Great Lakes basin to New Berlin, the big city's Common Council also advertised for a consultant to help it determine the true value of water.

It did so because it had no economic basis upon which to evaluate a modest, so-called regional cooperation fee it eventually accepted from New Berlin - - $75,000 annually - - as compensation for the agreement above and beyond the per-gallon charges set by the State Public Service Commission.

The plan was a good one: have an expert's study in hand as an aide negotiating a far bigger sale with Waukesha. (A brace of consultants is helping Waukesha with various legal, environmental, media and strategic matters as it prepares to formally apply for a Great Lakes diversion, and how much it will pay is sure to be a key issue when it comes to picking a seller.)

But Milwaukee didn't like the water pricing consultant proposals it received in response to a solicitation, and along with what I have been told was not-so-subtle resistance from the Milwaukee Water Works - - where there is in-house balking at anything from outsiders that might block sales from its under-utilized capacity - - Milwaukee has decided against getting independent opinion and expertise.

In an email exchange obtained in records provided by the Waukesha Water Utility, then-Milwaukee sustainability director Ann Beier told Waukesha officials that future sales would be addressed as they are now, on a "case by case basis without a formal analysis," according to an August 18, 2009 email to Waukesha Water Utility General Manager Dan Duchniak.

Who, in turn, let others know, eliciting this response from Bill McClenahan, a Waukesha contract lobbyist and PR specialist:

"This is good news from Milwaukee that they have given up on the value of water study, apparently concluding there is no magic formula (or perhaps that the formula would have resulted in a lower number than they had hoped for)," he said by email back to Duchniak and other Waukesha water consultants.

"In any case, it eliminates a potential source of delay."

Note that Milwaukee has chosen not to hire a consultant - - to the delight of Waukesha's consultants.

And the Milwaukee Water Works seems comfortable getting legal/informational questions answered about the Great Lakes Compact water selling provisions answered by Waukesha officials, other records show.

And as one well-informed person observed to me privately, illustrating the need for the Wisconsin Department of Natural Resources to have been the leader in the issue from the outset, which it has not as it continues to abdicate decision-making and parameter-setting to Waukesha,

So if you are keeping score, these early rounds are going to Waukesha - - not by strategic superiority, but by default.


Anonymous said...

This implies that the city is getting ripped-off. Do you not think Carrie Lewis is critically looking at this to be a rip off or not? I think you sometimes dramatize things to make it seem worse. It's subjective reporting to read between the lines. Why don't you contact the city government and water works to get a quote?

The Big Bopper said...

@ Anonymous:
This a blog not not the Milwaukee Journal. The Journal doesn't care to cover this story so we have to put up with James' flair. However I don't think you have to read between the lines to understand what the position of the City of Milwaukee's Water Works is on this issue: Carrie Lewis, with marching orders from Mayor Tom Barrett, is to sell City of Milwaukee water to raise revenue for the City. That is obvious based on the actions thus far. If the position is to be a seller than wouldn't the City want to know if they are getting ripped off or not?