Clash over control of Toledo-area water nears tipping point

City of Toledo set to back regional system, its nine customers to weigh in

1/8/2017

BY IGNAZIO MESSINA
BLADE STAFF WRITER

Maumee, Perrysburg, Sylvania, Fulton County, Lucas County, Monroe County, Whitehouse, and Northwestern Water and Sewer have approved a nonbinding resolution in support of forming a regional water authority.

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The proposal for a regional water system, which could erode Toledo’s control of its water system and strengthen influence from the suburbs, could reach a turning point Wednesday.

That’s the informal deadline for the respective governing bodies of Toledo and its nine water customers to decide whether or not they support such a move.

If they do, the Toledo Metropolitan Area Council of Governments’ Regional Water Planning Committee will move forward with plans to equalize water rates and give each customer a say in how the entity is governed.

If they don’t, the city’s suburban customers could break off and find other water providers or build their own plant, leaving Toledo stuck with the cost of maintaining its own supply through the aging Collins Park Water Treatment Plant.

“It’s definitely a critical point in this process,” Lucas County sanitary engineer Jim Shaw told The Blade.

Waterville and Toledo, a pivotal player, are set to consider the resolution ahead of the TMACOG meeting next week.

The goal of a regional water system would be to equalize rates across the board, Mr. Shaw said.

It would eliminate surcharges and have each customer paying the same rates by 2026.

As it stands now, two customers could consume the same amount of water yet generate different profits because each has negotiated its own contract with Toledo.

Figures from January, 2016, through October show Toledo received 47 percent of its water revenue from city residents with 53 percent coming from suburban water customers, even though city water customers used 59 percent of the water provided by Collins Park, with the remaining 41 percent used by suburban water customers.

Over the same period Lucas County customers brought in 24 percent of the system’s revenue while using about 12 percent of the total water consumed. Sylvania brought in 5 percent of the revenue and used 3 percent of the water, while Perrysburg generated 4 percent of the revenue while using 6 percent.

Jerry Greiner, president of Northwestern Water and Sewer District, said he favors a regional system because it would mean fair water rates for everyone.

“I’ve been here since 1988 so I’ve negotiated at least five contracts with various mayors. There’s been little uniformity in those contracts,” he said. “It would make sense for Toledo to open its books and open its doors a little bit and serve the nine contracts more on a regional basis rather than on a one-by-one, policy-driven basis.”

Should Toledo and its nine customers reach a consensus that regional bulk water is the way to go, the next step is to decide how the entity should be governed.

2 options

Mr. Shaw expects the TMACOG committee will consider two options. The first would be a regional water board comprised of one representative from each customer and two representatives from Toledo, since the city still owns the Collins plant.

The second option would be to form a regional water district under state law that would be governed by an appointed board.

“We’ll see if there’s a desire to go one way or the other,” Mr. Shaw said.

Toledo and Waterville officials are the only two who haven’t officially weighed in on moving forward with a regional system.

Toledo Mayor Paula Hicks-Hudson supports the nonbinding council resolution and Councilman Lindsay Webb has been leading the charge to get it approved.

Ms. Webb said it should pass at Toledo’s Tuesday meeting without much opposition, if any.

“As evidenced by the August, 2014, [water crisis], we are all impacted by the quality of our drinking water,” Ms. Webb said. “Water doesn’t know political boundaries. As we modernize our treatment facilities, it only makes sense to modernize the governance of our region’s most precious commodity.”

The strongest opposition came last week from former Toledo Mayor Carty Finkbeiner, whose three administrations were marked by disputes with suburban communities over water. He told council it should proceed with caution.

Mr. Finkbeiner is concerned that Toledoans will pay more to equalize water rates and won’t get credit for their prior investment into the existing system.

Speaking before a council committee hearing, he said: “Let no one push us into discussions with our backs to the wall” and “how will Toledo get credit for the cost Toledoans have put into the water infrastructure and sewer infrastructure?”

The former mayor added Toledo should have “controlling votes” in a regional water system “because it earned it.”

Mr. Finkbeiner later said it makes sense to consider a regional system but questioned what would be the cost to Toledoans.

“I did have a lot of problems with suburban communities, especially with Sylvania, which was attempting to get a lower rate,” he said. “We kept them close to two years on the old rate with some extra put into it and we did put an extra charge in there while we’re negotiating. [Sylvania] Mayor [Craig] Stough was the one choosing to play hardball.”

Toledo and its suburbs aren’t the only regional governments that have debated how best to manage water distribution. A push to create a regional system in Cincinnati was overwhelmingly rejected by city voters about five years ago, though an independent study found a regional public water utility would keep rates low by spreading costs over a larger customer base.

A regional water authority successfully formed in southeast Michigan in January, 2016, after the city of Detroit; Macomb, Oakland, and Wayne counties, and the state of Michigan united to form the Great Lakes Water Authority.

Toledo City Council President Steven Steel said Toledo officials need to work with suburban communities.

“That ‘we need control’ is so 1970s thinking,” Mr. Steel said.

“We already have a regional system. It will be different,” he said. “Why would Sylvania participate if we say we are going to have control of everything?”

Waterville a link

The city of Waterville, which is just weeks away from switching to Bowling Green as its water supplier, will consider the resolution at its meeting Monday.

The switch to Bowling Green started with discussions in early 2014, after Toledo notified Waterville its out-of-city surcharge would increase to 75 percent from 50 percent, and the declining block rate Waterville had been paying was eliminated.

“You’re now going to pay for every drop of water at the highest rate,” city administrator Jim Bagdonas said. “That had a big impact.”

Rates for the bulk purchase of water were increasing by 65 percent, Mr. Bagdonas said, which prompted the city to explore moving to the Bowling Green water system. Waterville now has a 25-year-deal with Bowling Green to receive water from them at a savings of about $250,000 per year.

But Waterville remains involved in regional discussions because what might be included for rates and other plans has not been determined. The city is connected now both to Bowling Green and Toledo’s water systems, making it a link between the two should one’s water be contaminated.

“Waterville could be the link to sending Toledo water from Bowling Green, or Bowling Green water from Toledo,” Mr. Bagdonas said.

Sylvania leads effort

Sylvania Mayor Stough has been leading the charge on forming a regional water authority since the 2014 water crisis when microcystin toxin from a massive algae bloom in Lake Erie overwhelmed the Toledo plant. He believes the move both makes economic sense and would allow for safety improvements with either a new intake, new plant, or both.

Mr. Stough said it is economically feasible for Sylvania to go out on its own or band together with other suburban customers should the regional plan fall through, but that is not his preference.

Sylvania, TMACOG, and Wood County each conducted studies about water distribution and treatment in northwest Ohio as discussions of a regional system took place. The TMACOG and Sylvania studies found the regional approach makes the most financial sense for all communities involved. Yet Sylvania’s study also found the city has the ability to construct its own water intake and treatment plant or partner with other suburban customers.

The Wood County study, which looked at Perrysburg and parts of the Northwestern Water and Sewer District, did not make any recommendations but found it would be possible for both of those Toledo customers to instead hook up to Bowling Green’s system.

“There’s a lot of variables in play at the moment,” Mr. Stough said. “I think everybody is taking an honest look at what’s best for their community.”

The TMACOG Regional Water Planning Committee meeting is 8 a.m. Wednesday.

Staff writers Sarah Elms and Zack Lemon contributed to this report.

Contact Ignazio Messina at: imessina@theblade.com or 419-724-6171 or on Twitter @IgnazioMessina.