After Just 24 Hours, Oak Creek-Waukesha Water Deal In Doubt

What does it say about the due diligence performed by water negotiating teams from the cities of Oak Creek (the seller) and Waukesha (the buyer) that they would:

*  Meet for 18 months discussing whether Oak Creek could handle Waukesha's desire to obtain, on average, almost 11 million gallons of water everyday - - a deal with Milwaukee that Waukesha could not negotiate with Milwaukee because Milwaukee saw it subsidizing development sprawling to an expanionist Waukesha;

*  With great fanfare, sign documents Tuesday authorizing an eventual 40-80-year deal, with Waukesha spending $183 million to pipe it in;

 * And then watch as the state Public Service Commission released a ruling the very next day - - Wednesday - - in a separate Oak Creek case under study since last year that Oak Creek couldn't bill another municipal buyer for certain water supply expenses - - a ruling that meant everyday Oak Creek retail customers would have to bear those costs.

The ruling by the PSC involved infrastructure and other expenses that Oak Creek wanted to recover from the municipalities of Caledonia and Franklin that Oak Creek supplies with water.

The PSC reduced by about 15% the money Oak Creek could get back from those wholesale customers, thus adding another roadblock to Waukesha's slow-moving application for permission under a multi-state agreement to acquire diverted water from Lake Michigan, as the Journal Sentinel explained:

As a consequence...retail customers of the utility, will have to pay a greater share of costs, [Oak Creek water manager] Yttri said...

"If you're losing money, why would you sell more of it and lose more money," Yttri said, referring to the looming deal with Waukesha.

What? A deal where the seller subsidizes Waukesha? Where have I heard that before?

Milwaukee Mayor Tom Barrett says a map of Waukesha's future water service area reveals its intention to double in size. Selling Waukesha water for all of that area would fuel unbridled suburban growth at Milwaukee's expense, said Barrett.

The application is in the hands of the Wisconsin DNR.

That agency cannot complete its analysis of the proposed diversion project, and its environmental impact statement, or send it as a complete application for separate reviews to the seven other Great Lakes states whose unanimous approvals are needed for the diversion project to begin until a potential seller for Waukesha is nailed down. 

Oak Creek now says it will put the deal with Waukesha on hold and study the PSC ruling.

1:37 p.m. update: An Oak Creek alderman wonders if a deal with Milwaukee is still possible:

[Oak Creek Ald. Ken] Gehl says it's possible Milwaukee could still negotiate with Waukesha at the last minute:

"They’re (the cost of the plan with Oak Creek is $8 million more than that of importing water from Milwaukee) reasonably close, for the folks in Waukesha to weigh whether or not they want to be entangled with the political process in Milwaukee, or if they want to make an agreement with Oak Creek, with very few strings attached.”