I didn’t get to hear much of the debate over selling water to New Berlin, but the absolutely best quote that I did hear came from Ald. Jim Bohl, who argued that using parliamentary procedure to delay the inevitable victory by the pro-sale faction would just be poor sportsmanship.
“A further delay tactic,” he said solemnly, “is a nah-nah, boo-boo game.”
The great orators have a new man among them.
Here’s how I wish it would go today at the Common Council, but it won’t.
Ald. Michael Murphy’s alternative to the proposed $20 wheel tax is adopted. Murphy has proposed a $10 wheel tax with lower special assessments for street repairs. Murphy’s proposal means property tax-exempt non-profits still kick in for street repairs based on the size of their individual properties; under the $20 tax proposal, non-profits with lots of property, but few vehicles, get off really cheap. In addition, the state just raised its own vehicle registration fees by $20. Make it expensive enough, and more people simply won’t register their vehicles.
Murphy’s proposal doesn’t stand a chance in the world, though. The $20 tax seems not only meant to fund street repairs, but also to serve as a symbolic Common Council declaration of independence and leadership. Some aldermen are clearly unenamored with Mayor Barrett’s low-key style.
Also during my wish-it-were-so council debate, the aldercritters find a way not to tax motorcycles, mopeds and scooters. It’s seems awfully silly to me to levy an additional $20 tax on vehicles that actually are lighter and cause less damage to streets than cars or trucks (yes, I have a scooter.)
The council then moves ahead and rejects Murphy’s proposal to sell water to the “middle third” of New Berlin. This deal is akin to a starving man selling his pure gold watch for a peanut butter sandwich and a glass of milk. The City of Milwaukee is desperate for the $1.5 million New Berlin is dangling. It is making this decision based on inadequate information and fear, a really dangerous combination.
$1.5 million and an annual talkfest is not worth it.
New Berlin wants to buy more Milwaukee water and send it further west into the suburb. In exchange, New Berlin will pay for the water, kick in an extra $1.5 million and agree to meet with Milwaukee representatives once a year to talk about “opportunities to improve the availability of skilled workers in both communities and to improve the access of workers in each community to job opportunities,” according to a proposed agreement between the two communities.
Jim Rowen does a nice job deconstructing the $1.5 million payment. An agreement to talk, though, is an agreement to do nothing. New Berlin needs to commit to helping fund transit between the two cities; it needs to commit to building affordable housing within its borders.
Those commitments should be made, memorialized and maybe even partially implemented before Milwaukee sends more water and sprawl over the county line. The Common Council should not go along with the deal as it stands.
Did the Water Works get its math right? It doesn’t look like it, but maybe I’m missing something.
Here is sentence and table from the Water Works feasibility report regarding selling more water to a larger piece of New Berlin.
Based on an average day demand of 3.5 MGD, estimated annual revenues to Milwaukee Water Works for the combined existing and proposed service area are summarized in the following table:
The report also says that the commodity charge is the result of 3.5 MGD multiplied by 365 days per year multiplied by the wholesale rate of $0.668 per 1,000 gallons.
I did the math and came up with water sales of $853,370. The Water Works table, though, shows a total of $895,854 for the water sold to the eastern third of New Berlin sold in 2008 and the amount projected for the middle third’s first full year. Why the $42,484 difference? It’s not explained.
Later in the report, Water Works also cites the $853,370 figure, but says that the entire amount will be realized only through sales to the middle-third section of New Berlin. That amount actually is what is expected from the entire New Berlin sales area.
From the report:
This method assumes that the anticipated additional revenue from water sold in the “middle third” of New Berlin would have reduced the 2007 rate increase by a proportionate amount. The revenue requirement identified by the Public Service Commission of Wisconsin for the Water Works’ 2007 rate case was $4.0 million. This method assumes that the additional estimated revenue of $855,370 from the “middle third” of New Berlin would have reduced the revenue requirement by 21% to $3.1 million. The calculation assumes that the 6% rate increase that satisfied the $4.0 million revenue requirement would have been reduced to 4.7%, saving the average residential customer $1.60 per year.
The daily average demaind for the entire New Berlin area proposed to receive Milwaukee water would be 3.6 million gallons to 3.9 million gallons. The Water Works uses 3.5 million gallons per day in its calculations, presumably to be conservative in its revenue estimates. By attributing all the revenue to the middle third area, Water Works could be overstating by 100% the economic benefit of the expansion to Milwaukee water customers. Instead of $1.60 annually for each residential account (no big whoop to begin with), the benefit of the expansion could be as little as 80 cents.
Unless, of course, I’m totally missing something.
New Berlin would pay Milwaukee $1.5 million for the right to buy Lake Michigan water and a much larger portion of New Berlin would get Milwaukee water than does now, under agreements to be considered by the Milwaukee Common Council.
About one-third of the suburb now receives Milwaukee water, and the proposed deal would add the middle third of New Berlin to the Water Works’ customer base. Click here and go to page 10 to see a map of the expanded service area.
“This area is outside the Great Lakes Basin but is within the MMSD service area; water is returned to Lake Michigan,” according to a Water Works feasibility study of the proposal.
The deal will provide economic benefits to Milwaukee water customers of an estimated $1.60 to $4.50 per residential account per year, the study said.
“Future water rate increases would proportionately increase the amount of the benefit,” the study said.
The maximum amount flowing to the suburb would increase from 4.8 million gallons per day to 6.3 million gallons per day. The proposed agreement also sets hefty charges of $10,000 to $30,000 per hour for excessive demand by New Berlin.
“This is intended to be an incentive to New Berlin to use various storage and well pumping combinations as well as emphasize their conservation efforts,” the Water Works study said.
The $1.5 million New Berlin payment to Milwaukee would go to the city’s general fund and would be in addition to regular water rates that go to the water utility, according to a resolution introduced by Aldermen Michael Murphy and Jim Bohl.
Under a proposed agreement between the two communities — a sort of side agreement to the actual water sales proposal — representatives from Milwaukee and New Berlin will meet once a year to talk about “opportunities to improve the availability of skilled workers in both communities and to improve the access of workers in each community to job opportunities.”
The two communities also promise not to “promote, encourage, offer economic incentives to, or otherwise solicit businesses to relocate from the City of Milwaukee to the City of New Berlin, or the City of New Berlin to the City of Milwaukee.”
Both the water sales agreement and the $1.5 million payment are scheduled to be considered by the Common Council’s Public Works Committee on July 29.