By Mike Renda, FOX 2 General Manager
Detroit City Council's recent no vote on a water rate hike has left many scratching their heads in disbelief.
Upon emerging from bankruptcy at the end of last year, council agreed to a four-year budget that contained increases in city water and sewer rates. Council also agreed to three years of financial oversight from a state-appointed review commission that would end if the city stayed on plan.
Council president Brenda Jones and members Janee Ayers, Scott Benson, Racquel Castaneda-Lopez, Mary Sheffield and Gabe Leland voted against a water rate hike. In doing so, they have opened a $25 million hole in the budget and put in jeopardy a quick end to the state's financial scrutiny.
I understand that the rate hikes in a city where many are unable to pay their current bills is not the most politically popular option. It's difficult for council members to approve a water bill when many of their constituents are struggling to make ends meet.
But a rate increase that would cost homeowners $5 more per month doesn't seem unreasonable. Many programs exist to help residents in need to pay their bills.
Jones should take the lead and face the water and sewer rate hike head-on. Why not insist that the water department submit a cost savings plan to go along with an increase.
There are reports that the water district has already been working on a plan that could save $40 million a year in costs.
This fact is well known- water is not free. The cost of maintaining plants and equipment paying workers and delivering clean water to the city and suburbs is real.
The bottom line is this Detroit's financial collapse and resulting bankruptcy was due in large part to our local government not maintaining financial discipline and failing to operate within agreed upon budgets.
Council must keep its promise to maintain financial discipline and swear off its destructive old ways.
The Detroit City Council can still get it right. They have agreed to reconsider the water rate vote. A vote for water rate hikes with some cost savings is the right thing to do council, let's get back on plan.
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