A report released Friday from a consultant hired to help Baltimore City and Baltimore County answer questions about converting to a regional water authority provided few answers and little guidance on the final, knottiest challenges.
The Baltimore Regional Water Governance Task Force, which was created through Maryland General Assembly legislation earlier this year, met for hours over three months to figure out how to change oversight of Baltimore City’s water system, which provides water and sewer service to 1.5 million customers.
The looming question has been whether the task force will recommend that Baltimore City turn over management of its largest public asset to a not-for-profit authority. That’s the option that was recommended by task force consultant WSP.
But after outcry from water and labor rights advocates — and WSP’s lack of convincing evidence that the authority was the best option — the task force was unable to decide whether that path justifies its significant cost and potential equity issues.
Task force members asked the consultant to look further into issues surrounding equity, debt refinancing and the fate of city public workers who currently run the water system. And they were asked to consider changes to existing water-sharing agreements between the city and Baltimore County, which consumes 58% of the total water and sewer service.
This week, WSP, which was contracted by Baltimore City, was expected to better answer questions about how much more money city and county residents and businesses would have to pay to support new management under a politically-appointed water authority, as WSP recommended.
WSP was also expected to offer ideas for what would happen to public workers’ job stability if the system is turned over to a water authority. WSP only said Baltimore City and county should convene a committee to figure it out.
But acknowledging that a water authority “presents significant risks to the city, county and region related to a series of threshold economic and community issues,” the consultant wrote that those questions “cannot be answered based upon consideration of a theoretical conceptual governance model.”
WSP failed to answer questions about the extent to which customers may be charged more to refinance city and county debt to support the transition to a not-for-profit water authority.
It did not answer questions about an authority’s effect on city and county workers’ pension plans or questions about possible charter amendments needed if the city would lease its water and sewer infrastructure to an authority. Nor did it answer what would happen to the city’s Water for All assistance program, which reduces water costs for certain low-income residents.
Baltimore County and the city comptroller’s office referred a reporter to the city’s public works department, which did not immediately respond to The Banner’s request for a copy of the contract or clarification ofn its amount Friday afternoon.the city’s list of current contracts.
Baltimore County and the city comptroller’s office referred a reporter to the city’s public works department, which did not immediately respond to The Banner’s request for a copy of the contract or clarification onits amount Friday afternoon.
The consultant has 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.
Out-of-pocket costs could be $15 million — not including retirement benefits transition costs, according to the consultant’s draft report.
In short, complex decisions that could affect the service rates of 1.5 million Baltimore-area water and sewer customers rest, for now, in the hands of the water governance task force.
On Friday, a spokesman for the city’s comptroller’s office said Comptroller Bill Henry, who chairs the task force, said he is “still deliberating the finalized copy and won’t have much comment on it right now.”
Henry said in a Tuesday interview that the task force will convene another meeting Jan. 8 to discuss the report before it issues its own draft recommendations by Jan. 25.
During an interview earlier in the week, Henry said he had concerns about the costs of transitioning to a water authority.
“The problem is that if the authority has to refinance the past debt — city and or county — the only way the authority is able to raise money to pay off that refinancing is by raising water and sewer rates for everyone,” Henry said.
Across its 1.5 million utility users, “everyone would end up paying hundreds of thousands more,” he said.
WSP’s report recommends Baltimore City and its suburban counterpart “commit sufficient resources” to figure out the possible issues of a transition themselves.
“If any of these threshold issues cannot be resolved equitably and economically, they each hold the potential to derail” a transition to a not-for-profit authority, according to the report.
The task force has scheduled an additional meeting Jan. 8. The public is being asked to weigh in on the draft report while the task force provides its own feedback. Its final, online meeting is Jan. 25.
The task force must submit its recommendations to Gov. Wes Moore, Baltimore City Mayor Brandon Scott and Baltimore County Executive Johnny Olszewski Jr. before Jan. 30