Mayors Convene in Oklahoma City to Discuss CSOs, Infrastructure Financing Strategies
By Rich Anderson
June 28, 2010
Pleasanton (CA) Mayor Jennifer Hosterman and Schenectady (NY) Mayor Brian Stratton, Co-Chairs of the Mayors Water Council, convened a Council meeting in Oklahoma City on June 11. Hosterman presided over review of several policy resolutions. The Mayors Water Council reviews resolutions and makes recommendations to the Environment Committee. Resolutions adopted by the U.S. Conference of Mayors can be accessed at www.usmayors.org.
Conference of Mayors Staff Member Brett Rosenberg commented on the preliminary results of a city bottled water survey conducted by the Conference of Mayors in May/June of this year. Rosenberg emphasized that the majority of the cities responding to the survey do not currently have city departmental bottled water purchase bans in place, but they actively encourage city departments to use and promote municipal tap water in lieu of bottled water. Rosenberg plans to complete his analysis of the survey and post a final report on the Conference of Mayors website later this summer.
Hosterman then turned to the subject of municipal water and wastewater finance. Referencing the Trends in Public Expenditures report published by the Conference of Mayors in February, she commented on the projected city spending range of $3 to $5 trillion over the next 20 years, and expressed concern over whether or not this is a sustainable financial model.
David Gadis, Executive Vice President of Veolia Water North America, presented a logic-based case for long-term sustainability of water and wastewater services. Recognizing the current revenue crises most cities are facing, Gadis made a strong case for mayors to seek sustainable financing rather than short-term solutions. For example, many cities are now deliberating over cost-cutting measures such as furloughs and layoffs, rate increases, service reductions, etc.; they are not giving due consideration to different business models that offer long-term solutions such as public-private partnerships and design-build-operate alternatives. Rather than relying on the uncertainty of increased federal aid, cities currently have the power to recast their relationship with their water utilities. Indianapolis, he stated, has had two decades or more of experience with partnerships. In that time they have provided quality service to city customers, and are envied at having the third lowest overall combined water and wastewater rates of all major US cities. Moreover, Gadis made a persuasive argument for the ability of a public-private partnership to develop customized solutions in any given city. Partnerships can establish programs tailored for a city's operating, capital and asset management needs. Large water companies with a demonstrated history of experience and successful performance can bring to bear resources and expertise that would not normally be within the reach of city utility departments.
Stratton led the discussion on the Combined Sewer Overflow (CSO) initiative the Conference of Mayors is engaged in with the US EPA. Stratton described the initiative whereby in several meetings and with the US EPA and the US DOJ have resulted in an agreement to review the CSO compliance negotiation process, and consider local government proposals to achieve compliance and simultaneously reduce the cost to do so. Stratton said that EPA reports indicate over 800 cities have CSO events that endanger public health, sensitive habitats and critical ecosystems. He stated that the nation's mayors share EPA's goal of reducing these threats, but that it can be done in a more cost-efficient manner.
Indianapolis Mayor Greg Ballard commented that, when he took office in 2008, the city had already entered into a consent agreement to control CSOs with a price tag of $3.9 billion. He was concerned about human exposures to raw sewage and worked to develop an alternative and sustainable engineering solution to reduce flows to the Combined Sewer System using green infrastructure methods. In 2009 the city's consent decree was modified with a plan to remove over one billion gallons of sewer overflows ahead of the EPA approved schedule. Still, Ballard stated, the then-current consent decree was overly prescriptive, and the city developed a new plan that had greater environmental benefits at a lower cost. The net result was that EPA agreed to work with the city on the new plan, and the city was able to save hundreds of millions of dollars with a new long-term control plan.
Chattanooga (TN) Mayor Ron Littlefield stated, "The federal authorities are unfairly hammering cities with combined sewers while allowing suburban areas to skate by with fewer restrictions. The only way to address the problem fairly is by dealing with an entire drainage basin — not just the municipal jurisdiction that is struggling to deal with the problem."
Kansas City (MO) Mayor Mark Funkhouser stated, "CSO is a huge issue for Kansas City. We have six billion gallons of overflow per year. Recently, we secured a 25-year agreement with the EPA to implement our overflow control plan at a cost of $2.5 billion. The help and support I have obtained from The U.S. Conference of Mayors and my colleagues on the Water Council has been extremely valuable as I have grappled with this issue."
Hosterman and Stratton introduced Sheik Mohammed Bin Essa Al Khalifa, Chief Executive of the Bahrain Economic Development Board of the Kingdom of Bahrain. The Sheik discussed the water development needs of Bahrain. He stated that Bahrain is the most open and friendly society within the United Arab Emirates for foreign investment. He welcomed American water companies and water equipment and engineering companies to contact the Economic Development Board to pursue business development and investment opportunities.
In closing, Stratton announced that the Mayors Water Summit will be held in Washington (DC) December 1 and 2. Also, Hosterman will be hosting a Regional Meeting of the Mayors Water Council in Pleasanton (CA) the last week of October (tentative date).