Official Water and Sewage Dept. Control Thread

[Hermod]

<sigh> $160 check to Comcast.

My ComCast bill is $25.

My water bill is $155.00.

My sewer bill is $62.

[MikeM]

http://www.sourcenewspapers.com/arti...mode=fullstory

At its last regular meeting of 2010, the Shelby Township Board of Trustees passed a proposal from Public Works Director Ted Schoenherr that calls for a 9.9 percent increase in water rates and a 9.9 percent jump for sewer service.

"As you know, the Detroit Water and Sewer Department sets costs for these services and as a result, unfortunately, our township has to pass these costs along to our residents," Supervisor Richard Stathakis said at the Dec. 21 meeting.

The increase went it effect Jan. 1. It calls for water rates to rise to $31.57 per 1,000 cubic feet - or approximately 7,500 gallons - of water and $32.64 to treat 1,000 cubic feet of sewage. That means a family that uses 7,500 gallons of water monthly will see their quarterly water and sewer bills rise approximately $17.34.

For Shelby Township residents, the increase marks the second consecutive year they have seen significant rate hikes. In December 2009, township officials approved 9 percent hikes for water and sewer service on top of a 1.5 percent jump six months earlier.

Those increases followed a 3-year rate freeze as officials evaluated the water and sewer system to determine if rates could be lowered. During those three years, the city of Detroit, from which Shelby Township gets its water, continued to raise its rates.

[Mikeg]

I live in a condo in Shelby Twp. and I'm on our Board of Directors, so I am very familiar with this 9.9% rate increase [[from $2.873 per unit [[100 cu.ft.) to $3.157 per unit) and I know that it will negatively impact our budget by about $3,000 in 2011.

I wanted to know exactly what is driving this latest water rate increase so I can explain it to my neighbors. To find the answers, I compared the information provided by the Shelby Twp. DPW to justify their 2010 and 2011 rate increases [2010 information is here on pages 118-125; 2011 information is here on pages 110-111 ].

From their data, it appears that the cost of water purchased in 2011 from the DWSD by the township is anticipated to rise by about 5.7% to about $2.639 per unit [[100 cu.ft.) Since they will bill their township customers $3.157 per unit for that same water, what accounts for the additional $0.517 per unit [[the "mark up") and why is the increase in the billed rate 4.2 percentage points higher than the purchased water increase of 5.7%?

Digging into the details, it is evident that the water department's budget expenses are split with 70% going for the purchase of DWSD water and 30% for the cost to operate and maintain the township's water system. I also noticed that the township anticipates that there will be no increase in the number of billable units of water compared to 2010 and that anticipated 2011 revenues to the township water department associated with new construction will be down by about 14.9% in 2011. Since the operation of the township water system must be self-supporting without any subsidies from the General Fund and they do not anticipate any withdrawals or additions to their reserves account, they must charge the existing water customers 9.9% more in 2011 to cover the
a) significantly increased expenditures for purchased water, even though the number of units purchased will be the same
b) slightly decreased expenditures for operating and maintaining the township's water mains
c) significantly decreased revenues due to fewer new water main taps, etc.

Unlike what has been suggested elsewhere on this thread, the township is not profiting from the "mark up" and/or the difference between the DWSD increase of 5.7% and the township's water dept increase of 9.9%.

[MikeM]

Despite what jt1 claims, I think the suburbs' complaint is with the increase in wholesale water rates and how they are determined.

[Mikeg]

Despite what jt1 claims, I think the suburbs complaint is with the increase in wholesale water rates and how they are determined.

I agree, but according to him, just because the suburban water departments "mark up" the rate charged by the DWSD as well as the DWSD rate hikes, the suburban residents supposedly have no reason to complain about the lack of transparency and mismanagement at the DWSD.

[jt1]

I agree, but according to him, just because the suburban water departments "mark up" the rate charged by the DWSD as well as the DWSD rate hikes, the suburban residents supposedly have no reason to complain about the lack of transparency and mismanagement at the DWSD.

That is completely inaccurate. As I have stated, I think that DWSD is managed/ My previous statement [[which appears was ignored by you) was, "I am not defending the mismanagement. It needs to be addressed immediately."

My additional points were:
1. That when people complain about rate increases they never check to see the increases from their own community [[Funny that the Shelby Township increases are just assumed to be valid. They likely are but nobody questions the operating budgets of their own communities that tack equivalent increase onto their services.
2. People believe that a Detroit owned asset may be taken over because customers aren't happy about the service or management. As I stated, I think DWSD is mismanaged but that does NOT give suburban customers the right to expect to take over the asset. They can choose to build their own or offer to be a partner with an infuction of cash. Simply taking it over is not an option.

I recommend that you read all of my posts next time you make assumptions about what I think.

[jt1]

Despite what jt1 claims, I think the suburbs' complaint is with the increase in wholesale water rates and how they are determined.

They have a right to complain about mismanagement or the way the rates are determined. DWSD has, however supplied the algorithm that dictates the cost of water to the communities.

Focus on the mismanagement but claiming that the suburban leaders do not know how the rates are calculated is false. DWSD has turned over the SW they use to calculate the rates and have held meetings in many communities explaining [[a) how the rates are calculated [[b) the variables used and [[c) how the communities may be able to reduce their cost [[filling reservoirs in off hours, reducing usage in peak hours, etc).

I went to the meeting DWSD had with the Oakland County commissioners. Their [[OC Commissioners) lack of understanding of basic concepts was pure comedy.

**Note - I am in no way affiliated with DWSD and do not defend their poor management. I went to the meeting because I was in the area and was curious how DWSD would be treated**

[Mikeg]

That is completely inaccurate. ........
I recommend that you read all of my posts next time you make assumptions about what I think.

My apologies. The comment was Kevingoblue's. You merely "high-fived" him by writing that his comment was the "thread killer".

[jt1]

My apologies. The comment was Kevingoblue's. You merely "high-fived" him by writing that his comment was the "thread killer".

Fair enough but it was a chest bump, not a high five.

[Mikeg]

Did you question your community how 30% of the rate cost goes to operate/maintain the Shelby Township water department. It seems to me that a 70%/30% split seems pretty local heavy.

The 70% is for pumping, treating, monitoring, infrastructure, etc.
The 30% is for ??

I'm not saying that your community is overcharging you but it seems that you aren't looking for answers why that 30% can't be lowered. At first glance the 70/30 ratio seems pretty local heavy.

**I have not looked at the numbers. I'm just pointing out that you take Shelby Townshipo at their word when there is a significant cost being passed on to you**

I noticed that for some reason you deleted that post before I could respond.

You say that "At first glance the 70/30 ratio seems pretty local heavy" and want me to define/question/defend the Shelby Twp. costs that make up 30% of their budget.

Perhaps instead you can find the DWSD budget data broken out similarly such that you can calculate a ratio for the Detroit wholesale water costs vs. the operation & maintenance costs of the Detroit water mains that deliver the water to its retail customers. Then maybe we can have a better discussion about whether the non-variable costs being passed on to the retail water customers are significant or not.

Since I doubt that you can find that kind of detailed data [[despite the alleged transparency of the DWSD, I'm not able to find it), let's try this simple comparison.

In addition to the $3.157 per unit of water used, each Shelby Twp. water customer is also charged a $2.50 service charge on each bill, which is sent quarterly. So if a hypothetical Shelby Twp. customer used 5 units of water each month, their quarterly water bill would be [[5 x $3.157 x 3) + $2.50 = $49.85.

Using this source for the available data on the city of Detroit's retail water customer rates, it appears that each Detroit water customer is charged $1.000 per unit of water used. Each Detroit water customer is also charged an $11.00 service charge on each bill, which is sent monthly. So if a hypothetical Detroit customer also used 5 units of water each month, their monthly water bill would be $16.00 and they would pay $48.00 over a quarter.

Based on this hypothetical example, the customers in Detroit and Shelby Twp. pay almost the same amount over three months time despite the significant differences in their rates. It appears to me that unlike Shelby Twp, Detroit uses their monthly service charge to recover its non-variable costs to operate & maintain the water mains that service their customers.

Assuming that the price Shelby Twp. is charged by the DWSD for wholesale water is necessarily and rightly higher than the price the DWSD would theoretically charge themselves for Detroit customers - and knowing that Shelby Twp. has fewer retail customers and a smaller water main distribution system to operate & maintain than Detroit does - it would seem to me that Shelby Twp.'s operating and maintenance costs are not out of line.

The bottom line is that unlike Detroit retail water customers, the suburban wholesale water customers can clearly see the amount of increase in the price of DSWD's treated water. What they would also like to know is for example, how much of that increase is due to DWSD's inefficient operating practices [[with the reduced demand, does it still make sense to operate four water treatments plants?). The cost sharing algorithms do not address these kind of legitimate questions.

[kenp]

http://www.clickondetroit.com/news/26404825/detail.html

[begingri]

Detroit City Council: We're keeping control of water system

http://detnews.com/article/20110114/...#ixzz1B2LaNUWX

[Hypestyles]

there needs to be stimulus spending to to a complete renovation of the water delivery-treatment infrastructure for the region

[DetroitPlanner]

I never understood why Detroit went to the monthly water bill. When I called to ask if I could pay quarterly I was told no, and they explained that the reason for the change was because they were being benevolent because some people could not come up with the amount to pay three months at once.

The above explaination by MikeG regarding the $11 per bill monthly charge makes sense to me. I have wondered why on earth has the cost of my water gone up so much? This is effectively charging me $22 extra per quarter or close to $100 in this fee alone on top of what an increase would be to help offset the cost of delivering/treating the water. I always assumed that cheaper water was one of the few perks of living in the City proper. I always paid my bill 3 months in advance just because I think its stupid to keep writing checks every month as I have not discovered a way to pay this one electronically.

It seems to me that it would be cheaper for the board of commissioners to bill people less and those savings could be passed on to the consumer. After all it costs 3* the additional cost to generate 12 bills instead of 4!

I can understand the City wanting to retain control over the water department. The city was the one who built the system and they are the ones ultimately responsible for it. I can understand the suburbs for being made at the past adminstration too. I know I sure am!

[fryar]

I only know of this issue from this thread, so pardon my naivete, but it basically sounds like officials on all sides are being inept, corrupt, and/or inflammatory/grandstanding, to the point of obscuring the actual problem[[s).

Sign me up for an apartment with utilities included in the rent.

[shovelhead]

I only know of this issue from this thread, so pardon my naivete, but it basically sounds like officials on all sides are being inept, corrupt, and/or inflammatory/grandstanding, to the point of obscuring the actual problem[[s).

Sign me up for an apartment with utilities included in the rent.

And you expect the landlord or management company to continually absorb the increases in the utilities?

[mam2009]

I'm a Detroit resident and I'm tired of my streetlights not being on & the Police not showing up when people call & EMS showing up late or not at all because they're backed up with people who couldn't afford their meds & had a diabetic crisis, etc SOOO ...I want to regionalize PLD & EMS & I want the Wayne, Macomb & Oakland County Sheriff Dpts to all combine.

[MikeM]

http://www.freep.com/article/2011011...ater-authority

[Hypestyles]

i guess this will be the next regional fight.. if the bill gets legs, I wonder how Snyder will react..

[SWMAP]

Replying to MikeM about the Heise legislation introduction described in the Free Press article: Heise has been a State Representative all of - what - one week? Obviously he couldn't know the ropes, hasn't built any alliances - he's just a jerk. A telling thing - and I don't have time to look it up - is whether anyone else jumped into these dangerous waters with him. Are there other sponsors/ Does he have state-wide support?

Any show-boater can introduce legislation. But can you get it through?

[Detroit500]

Regional interaction could have its plusses depending on how this bill is designed. This, combined with regional efforts with Cobo and other developments could be very useful in terms of getting the region to think more collaboratively with a regional infrastructure/governance.

Times are changing, Hackel is going to be an ardent voice for Macomb County, Brooks Patterson will be the ardent voice of Oakland County for life. You need to get these men on board.

[lincoln8740]

Regional interaction could have its plusses depending on how this bill is designed. This, combined with regional efforts with Cobo and other developments could be very useful in terms of getting the region to think more collaboratively with a regional infrastructure/governance.

Times are changing, Hackel is going to be an ardent voice for Macomb County, Brooks Patterson will be the ardent voice of Oakland County for life. You need to get these men on board.

I always find it funny that the ones who scream "regional cooperation!" on this board when it comes to the suburbs giving something to the city are strangely silent when it is the City possibly giving something up to the suburbs.

As for the bill--HELL YEAH about time. I would love a real audit on the Water Department. They are and have been the most corrupt and inefficient City department for YEARS.

[MikeM]

http://www.freep.com/article/2011011...r-water-system-

[mam2009]

I noticed that for some reason you deleted that post before I could respond.

You say that "At first glance the 70/30 ratio seems pretty local heavy" and want me to define/question/defend the Shelby Twp. costs that make up 30% of their budget.

Perhaps instead you can find the DWSD budget data broken out similarly such that you can calculate a ratio for the Detroit wholesale water costs vs. the operation & maintenance costs of the Detroit water mains that deliver the water to its retail customers. Then maybe we can have a better discussion about whether the non-variable costs being passed on to the retail water customers are significant or not.

Since I doubt that you can find that kind of detailed data [[despite the alleged transparency of the DWSD, I'm not able to find it), let's try this simple comparison.

In addition to the $3.157 per unit of water used, each Shelby Twp. water customer is also charged a $2.50 service charge on each bill, which is sent quarterly. So if a hypothetical Shelby Twp. customer used 5 units of water each month, their quarterly water bill would be [[5 x $3.157 x 3) + $2.50 = $49.85.

Using this source for the available data on the city of Detroit's retail water customer rates...

The source you've cited there does not list water rates for the City of Detroit, Michigan. That's a link to a website for the City of Detroit Lakes, Minnesota!

[mam2009]

The title of this article could also have been, "Rochester Hills takes responsibility for its increasing water rates".

http://www.theoaklandpress.com/artic...mode=fullstory

That's what I call looking deep inside and taking a little personal [[or municipal) responsibility. Be real about your contribution to the problem, take steps to improve your situation...enforce that peak-time watering restriction ordinance, etc... Don't just blame DWSD and assume that the solution is to take over operation of the system.