I recommend this piece about water and jobs from Sunday's Crossroads section, with special attention to the Akron, Ohio model:
As Milwaukee expands its use of water as an economic development tool, it should look to the experience of Akron, Ohio. In order to sell water to its suburbs, that city first enters into agreements with those suburbs to establish economic development districts. It receives revenue through user charges for water sales to the district plus it receives a share of the district's income made possible by those sales. Since Milwaukee contemplates similar suburban sales of water through diversions of purified Lake Michigan water, it should consider creating a similar shared-income formula.
Water pricing also should play a greater role in the current discussion of Waukesha's application for water diverted from Lake Michigan and purified by the Milwaukee water utility. In fact, without proper prices in place, no one can estimate how much water Waukesha needs - if any!As far back as 2004, and reported in 2006 and 2007, some Waukesha officials have thrown cold water on the idea of linking water sales to sharing development revenues - - but maybe this is an idea whose time has come.