DETROIT (Michigan News Source) – A public hearing on Wednesday will settle whether the Great Lakes Water Authority will succeed in raising wholesale water and sewer rates 2.75% beginning in July. 

The decision would affect 4 million Michigan residents who are in the 88 communities mostly in Metro Detroit that use GLWA services.  The company is one of the largest wastewater services in the country and services 40% of Michigan’s population with water and 30% sewerage services according to GLWA Chief Financial Officer and Treasurer Nicolette Bateson.  

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While rates jumped 3.7% for water and 2.8% for sewer last year, GLWA is proposing a 4% budget increase, or $14.2 million for the water and sewer budget for this year according to the Detroit News. 

According to Bateson the cost of chlorine rose 80% over the past few years, causing GLWA to evaluate raising the costs of their products.  The Fiscal Year 2024 budget is $871 million, with nearly half of it going towards unpaid debt. 

“Despite all that, we’re very committed to the 4% promise that our budget won’t increase any more than 4%,” Bateson said.

Because of the cost pressures, the five-year capital improvement plan was scaled back “so that we could stay within that 4% promise,” she said.

But neither of the proposed increases contain an unpaid debt  lawsuit to the company from a lawsuit alleging that Highland Park owes $21 million in unpaid water and sewerage bills. 

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“We are in a confidential mediation session with Highland Park, and we’re hopeful that through that process, we could find a long-term solution,” she said. “We thought the right thing to do this year was to just hit the pause button on any Highland Park bad debt expense, let this process play out, see if we get all the stakeholders to the table and come up with a longer term solution.”

Residents of Dearborn, Highland Park, and Detroit pay for other services in addition to GLWA’s charges, including for underground water systems operated by a public works crew. 

During the Pandemic, as many as 60,000 Detroit households had unpaid debt north of $84 million.  The city launched the Lifeline Water affordability plan to eligible and enrolled households to have debts forgiven.  

The program is an 18-month pilot program that received $15 million from regional and federal funds according to Detroit Water and Sewerage Department spokesman Bryan Peckinpaugh.  With the current funding,  20,000 households could be supported by the Lifeline Plan, but sources for future funding are still unclear. 

Director of the University of Michigan Water Center, Jennifer Read acknowledged that Detroit’s Lifeline Plan isn’t perfect, but it is a start. 

“It’s an affordability plan, which is different than assistance. And right now, I think we need both,” Read said. “Many households also have this accumulated debt, which they need assistance to address. We also have to think about things like long-term maintenance and upgrading systems and that can’t be skimped on either.”