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Detroit Emergency Manager Looking To Privatize The City’s Water Department

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DETROIT (WWJ) – Detroit Emergency Manager Kevyn Orr says he’s looking into finding a private buyer for the bankrupt city’s water department.

The word comes after the leaders of Oakland and Macomb Counties have nixed a plan to create a regional water authority.

Orr said he would have preferred to get the suburbs on board at the Detroit Water And Sewerage Department, but he has a duty to look into all opportunities — also  including possibly leasing the department.

Macomb County Executive Mark Hackel told WWJ Newsradio 950 he believes privatization could work.

“The private sector’s going to come in, take a look at that and say, you know what? We can make a go of this,” Hackel said. “Because we understand what the capital grouping costs are going to be. We understand the money flow in making sure that we’re generating some kind of income or revenue from that.

“That’s how they’re going to look at that — not how they’re going to pay the creditors; how they’re going to pay the pensioners,” Hackel said.

Hackel said any arrangement must put ratepayers first, with expenditures toward system upkeep, and not paying off Detroit’s debt. 

He explained why he would prefer privatization over the creation of a regional authority.

“Just because it’s in the hands of other elected officials that are going to have appointees on it, it’s still susceptible to public corruption,” Hackel said. “There’s been corruption in and around that Detroit water/sewer system for years. And just to say that, well, we make it a bigger group of people that have appointees on it, does that change the potential for that to happen? No, I don’t think it does.”

Detroit City Councilman James Tate said other municipalities have said that they want more control of the department. But, he said, there are more members of suburban communities than Detroit on the board, and rates are still increasing.

“I think it’s clear that it’s not just about the representation,” Tate said. “When you’re in a position where you’re going to have to take over the dilapidated infrastructure and all those challenges that the DWSD has, that means that you have to also (bear the) burden and the pain of restructuring — and that’s not an easy thing to do.”

Tate says he is still hopeful that the city can come up with some kind of deal.

Oakland County Executive L. Brooks Patterson has said he fears any deal could gouge his residents on water rates.

So what does Detroit Mayor Mike Duggan think about the options?

“Kevyn Orr and I have an agreement where he doesn’t comment on the areas of my responsibility, and I don’t comment on the issues in his area,” Duggan said.

MORE: More Questions Surrounding Future Of Detroit Water Department
Detroit Bankruptcy: Complete Coverage

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