Friday, July 26, 2019
As Youngstown spends wastewater money at a rapid rate to pay for federally mandated improvement projects, Mayor Jamael Tito Brown refuses to budge from his position that he won’t raise sewer rates.
But he recently told me that information being gathered on behalf of the city about the sewer rates could be finished in a month or so. While that doesn’t mean he’ll move on a sewer-rate increase to fund those projects, at least it’s not being ignored.
The city has a number of financial issues to deal with, but this is the most expensive one.
The city is under a mandate from the U.S. Environmental Protection Agency to make $160 million worth of improvements to its sewer system. It doesn’t have anywhere close to the money to do this work.
One way it has paid for some of the work – and what is needed for it to continue – is a sewer rate increase.
There’s no disputing that the 22,000 city sewer customers already pay a steep sewer fee.
But without increases, the city cannot make the required improvements.
The state EPA decided earlier this year to delay loans to the city for the work because Youngstown won’t raise sewer rates needed to repay that money.
Kyle Miasek, interim finance director, said a couple of months ago that the wastewater fund started 2019 with a surplus of $12,117,919. In just four months, it was down to $9,321,369 and would continue to decline.
Also, the city needs to spend about $8 million more this year on projects it’s committed to have done at its treatment plant on Poland Avenue.
Without the EPA loans, the wastewater fund would be in the red – and it could happen quickly.
Brown recently said he’s waiting for more information from Arcadis, an international firm that specializes in water and sewer analysis. The company recommended in October 2018 that rates be increased 8 percent a year for five years, starting Jan. 1 of this year.
If Arcadis’ recommendation was approved, the monthly sewer rate would have gone from $98.91 per 1,000 cubic feet now to $106.82 this year; $115.37 in 2020; $124.60 in 2021; $134.57 in 2022; and $145.33 in 2023.
Brown also said Michael Abouserhal, a financial expert hired by the city for budget analysis, should have a report in a month or so on “an overall view of wastewater. He’ll come back with a recommendation.”
Despite Brown’s refusal to increase rates, it’s the only solution.
Arcadis will certainly recommend it again.
It would be surprising if Abouserhal doesn’t do the same.
Brown has talked for months about sitting down with federal and state EPAs to discuss a possible reduction of the $160 million. That’s worth a shot, but it’s almost a certainty that nothing will change.
The federal EPA originally ordered the city in 2002 to spend $310 million on improvements to its sewer system. The city negotiated for more than a decade before the EPA lowered that amount in 2014 to $160 million. The city signed that agreement, and the EPA expects Youngstown to honor it.
The Arcadis recommendation for rate increases would only cover about $75 million of the $160 million in improvements.
New facility
That’s for work at the treatment plant. The remainder of the work is for a new facility near the plant to better control sewage in heavier rainfalls and for an intercepter sewer to keep wastewater from flowing into Mill Creek.
If the city moves ahead with a rate increase, the state EPA will likely change course and approve loans, which Youngstown could use to replenish its wastewater fund and avoid going into deficit. The EPA loans are repaid by the city over a 20-year period.
The city can wait a little longer to look at what it can do with its sewer rate, but the clock has been ticking for a long time. And there’s really only one decision to be made. It’s not whether there should be a sewer rate increase. It’s how much.