In the final minutes of the Baltimore Regional Water Governance Task Force’s penultimate meeting Thursday night — expected to end with a vote proposing study of a final option to reform Baltimore’s water and sewer system — task force members decided too many questions surrounding the financial impact of a quasi-public authority remain unanswered.
“Before I came to this meeting today, I must admit I thought I was hook, line and sinker set on” recommending a politically appointed water authority, said task force member Carla Reid, former general manager of Maryland’s largest water utility, WSSC.
But, with unresolved questions surrounding debt refinancing, the fate of city-owned water infrastructure assets and workers’ pensions, and whether low-income Baltimore-area residents would be plunged into high-rising water bills, Reid said, “it gives me pause.”
Reid’s comments came shortly after task force member Patrick Moran, president of an American Federation of State, County and Municipal Employees union council, said the governance model the task force was prepared to vote on — a politically appointed authority composed of directors and a rate-setting board — seemed to be the privatized system that Baltimore comptroller and task force Chairman Bill Henry, Baltimore Mayor Brandon Scott and Baltimore County Executive Johnny Olszewski Jr. said they didn’t want.
Henry clarified that his position was “that we would not recommend leasing it out to a for-profit entity,” rather than a quasi-public authority.
“I’ll admit,” he added: “It’s the splitting of a hair. But it’s an important hair to split.”
The task force, appointed by Olszewski and Scott to recommend reforms of the city-owned water system, was primed to suggest creating a politically appointed water authority and rate-setting board to take over operation and management of the troubled water system. It’s the model that environmental consulting firm WSP recommended they adopt and pass along to Baltimore City and Baltimore County, which shares use of the utility, for review.
But members of the task force drew back from voting on that — or any — recommendation during their virtual meeting. Instead, they asked WSP consultant Neil Callahan to go back to the drawing board to address some of the looming questions.
And they asked to see if the task force can recommend another option — outlined in the consultant’s recommendations but given little attention during meetings — which outlines changes to the inter-municipal service agreement between Baltimore City and Baltimore County.
That option, supported by social justice and water-equity advocates such as the NAACP Legal Defense and Educational Fund and D.C.-based lobbyist Food & Water Watch, would have the city and county modify their utility-sharing agreements and improve inter-jurisdictional communication and procedures relating to the water and sewer system.
Per the consultant’s report, the option would also establish a rate-setting board to review utility-rate recommendations and performance, and to solicit community input to determine billing changes.
Some of those changes would require the city to amend its charter, Henry said, but of the changes that can be done, “why don’t we just do them? Regardless of whether we do any of these things [recommending a quasi-public water authority] or not?”
Callahan said, “I have to talk to the county” — meaning Baltimore County, which is the biggest customer of the city-run utility — to see what could be done.
The shift on the task force came after public comment from opponents who criticized lacking evidence to support the consultant’s claims that handing over operations and maintenance of the city’s $5 billion asset would resolve the system’s woes.
The consultant report presented to the task force Thursday projected that Baltimore could see its debt obligations for the water and wastewater system increase by up to $540 million under a transition to a quasi-public authority. Baltimore County, meanwhile, might see its debt obligations increase by $180 million.
During public comment, speakers questioned (again) how the task force could confidently recommend a privatized water authority without conducting an equity study to ensure such a change would not disparately impact the city or low-income households.
They said Callahan failed to provide substantive answers on how such a transition would be possible without painful and disparate city refinancing. If Baltimore City and its suburban counterpart have to refinance to support a transition to a regional authority, a consultant projects the city would take the hit.
And an organizer with the American Federation of Teachers in Maryland labor union said it was unclear what would happen to the collective bargaining rights of city and county public works employees if their work was suddenly under the purview of a politically appointed board.
“I am not comfortable saying Model E [a water authority] is my preference right now without getting more information regarding how those threshold issues might be resolved in a reasonable way,” task force member Robert Summers said.
“Our first recommendation ought to be to fix” the existing city-county water service policies and processes while continuing to explore how a regional water authority might be implemented equitably, Summers, Maryland’s former secretary of the environment, said.
Scott and Olszewski announced the Baltimore Regional Water Governance Task Force in January, after the General Assembly passed a law to require such a panel study approaches to water and wastewater governance in the region and recommend how the system should be owned, run and managed.
Creating a new water authority, Olszewski said in an interview, is a top priority of his administration as Maryland lawmakers prepare to reconvene Jan. 10. The General Assembly session starts just before the task force’s final meeting Jan. 25.
The task force is expected to issue draft recommendations in December for public feedback before its final report due Jan 30.