Thursday, March 11, 2010

Consultants See Water Sale Side Deals As Regional Opportunity

The best chance for using water to address socio-economic issues in heavily-segregated Southeastern Wisconsin - - and in particular for Milwaukee and Waukesha - - is through a negotiated and cooperative water sale contract, said Catherine Madison, representing UWM consultants who have been performing a socio-economic analysis of a pending regional water supply plan.

Madison presented preliminary, draft recommendations and findings at a sparsely-attended meeting Thursday night in Waukesha. The UWM team - - from the Center for Economic Development - - final report will be made after March 31., and comments are still being solicited at this site.

She said she was aware that opposition against this kind of regional approach has been voiced by some Waukesha aldermen and citizens, the latest on Monday night at a public meeting in the Waukesha Common Council chambers where city officials presented a draft Lake Michigan diversion application.

Some opponents fear that Waukesha would lose "sovereignty," or independence" through Milwaukee conditions on a water sale they claim could transfer control of policy development or service implementation in Waukesha to Milwaukee.

Waukesha City Administrator Lori Luther said at the meeting that she would not bring to the Council, as a member of Waukesha's negotiating team with Milwaukee, any agreement that harmed Waukesha's sovereignty or independence.

Waukesha's Mayor, Larry Nelson, and Waukesha Water Utility general manger Dan Duchniak have said at various meetings that the City of Milwaukee is the preferred Lake Michigan water supplier should the diversion be approved by all eight Great Lakes Governors.

The Milwaukee Common Council, however, has said that a water sale to Waukesha must include Waukesha's participation in regional solutions to housing, transportation, land use and other socio-economic problems borne disproportionately by Milwaukee - - a poorer city landlocked by state law.

(The winner of Waukesha's February mayoral primary, Jeff Scrima, uses that language to define his position: you can read a sample statement on the matter from both Scrima and Nelson, here.)

And several organizations and civil rights lawyers have sent the UWM consultants detailed comments arguing that water and social justice concerns are and should be inextricably linked.

These sharp differences mirror the long history of distance and disagreement between the two cities: the subcontinental divide that separates the communities, and establishes the boundary defining Waukesha's legal hurdle to get Lake Michigan water from any seller, is certainly a physical, economic, racial, political and cognitive barrier that is becoming clearer and sharper over water.

Madison said that Waukesha and Milwaukee negotiating and working on an agreement was better than making no effort.

Waukesha could turn to Oak Creek or Racine as suppliers, though that water is more expensive than Milwaukee's, and piping it from those more distant cities would add to the projected cost.

Waukesha's diversion application calls for sending Lake Michigan water into Waukesha and to an additional 17.5 square miles west and south of Waukesha's city limits; Madison said the UWM analysis showed the diversion would not alter the region's current socio-economic realities - - the area's "historic trends and projections.

In their "key conclusions," the consultants wrote:

"At this point, there is no decisive evidence that a switch in course, from groundwater to Lake Michigan, will have a significant impact on population or job growth patterns, low-income households, or housing and land use patterns between now and the year 2035."

A Lake Michigan supply for Waukesha and several smaller communities is recommended in a nearly-completed, five-year regional water supply study by an advisory committee appointed by the Southeastern Wisconsin Regional Planning Commission.

That committee is dominated by water utility managers, county planners, public works directors, scientists, regulators and large corporate water users.

That committee's work was assisted by Ruekert-Mielke, an engineering consulting firm that wrote New Berlin's Lake Michigan diversion application and co-authored Waukesha's 2002 comprehensive water supply study that first recommended a switch to Lake Michigan water.

On the matter of water and growth - - a key component of the region's socio-economic picture - - Madison said that developers interviewed by the UWM consultants said their focus was more on available infrastructure than the source of water:

SEWRPC has said that growth in Waukesha will take place regardless of which water supply it offers - - a perspective echoed in the UWM findings.

Madison pointed to the water contract reached in 2008 between Milwaukee and New Berlin to sell diverted Lake Michigan water as an example of two communities able to sit down and work out a cooperative agreement that extended beyond the per-gallon water pricing established by the State Public Service Commission.

She said such negotiations were "the best opportunity" for water to be used to address socio-economic concerns; Madison said there was also a "net benefit" through a Waukesha purchase to low-income Milwaukee water rate payers - - and all users - - because the cost of the Milwaukee water utility operation would be spread over a larger base.

The Milwaukee-New Berlin contract called for a one-time, $1.5 million payment to Milwaukee covering the 20-year term of the water sale - - referred to by New Berlin representatives as something of a regional cooperation payment, with Milwaukee free to use the money as it saw fit.

This was an alternative to New Berlin directly agreeing to help Milwaukee or the region with transit access, affordable housing starts, or related, broader issues - - these days more often than not called socio-economic matters.

The New Berlin payment came to about 8 cents per Milwaukee resident annually - - an amount I called "irrelevant" in my comments Thursday night.

Based on a similar formula, and taking into account Waukesha's larger volume of water sought from Milwaukee, I figure the per-capita benefit to Milwaukee residents in a side deal similar to the New Berlin deal amounting to about 32 cents per-capita in Milwaukee, per year, for 20 years.

Madison said a contract between Milwaukee and Waukesha could also have "soft language" stipulations, as does the Milwaukee-New Berlin arrangement. That agreement includes some "no-poaching" language to curb business raiding, and an annual meeting between the two cities' representatives on workforce development.

I checked earlier this week; that meeting has yet to take place.

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