Detroit, Suburbs Reach Tentative Deal On Water System

By Sara Jerome,
@sarmje

Potentially putting an end to a protracted battle, bankrupt Detroit has reached a tentative deal with the suburbs on how to share control of the city's water system.

"Nowhere has the battle between Detroit and its suburbs been more apparent than in the city's beleaguered water system, which serves millions of customers and hundreds of communities. Detroit owns it; the suburbs want to help control it," NPR recently reported.

The 40-year deal between Detroit and its neighboring counties will become official if approved by the Detroit City Council and at least one county, according to WXYZ. The agreement would create a regional water authority. "The deal would become part of Detroit’s Chapter 9 bankruptcy restructuring plan," Detroit Free Press reported.

"The deal calls for Detroit to lease the system's infrastructure to the suburban communities for the next 40 years in exchange for a $50 million annual fee and $4.5 million a year in payments to an assistance fund. Detroit will continue to own the equipment, while the suburbs will provide funding to help rebuild the system and to provide financial assistance to customers who are struggling to pay their bills," WXYZ reported.

The plan imposes a "10-year limit on annual rate increases," the Associated Press reported. The governing structure aims to provide the suburbs with some control. "Only two of the governing board's six members would be appointed by Detroit," the AP reported.

What would Detroit get? "As part of the deal, Wayne, Oakland and Macomb counties would drop their opposition to the city's long-term restructuring plan in bankruptcy court," the AP said.

Not everyone is thrilled with the proposal.

"Water customers in Wayne, Oakland and Macomb counties could pay higher rates if their county commissions decide not to join aproposed regional water authority, county officials have learned. And they’re not thrilled about that," the Detroit Free Press reported.