Monday, April 12, 2010

Detroit Urged to Sell Water and Sewerage Department

Today's (April 12, 2010) Detroit Free Press includes an Op-Ed piece by a local business consultant, Marcus Hudson, urging the City of Detroit to consider selling the Detroit Water and Sewerage Department. Entitled "Dump the Myths Sell Detroit's Water Department," Mr. Hudson's article seeks to debunk two of the most frequently cited reasons for maintaining DWSD as a public agency: profits and jobs. The principal reason to consider the sale of DWSD: money. Or the lack thereof. 
Given its current state of disrepair, Detroit needs to start raising revenue and acknowledge that cost-cutting can only get the city so far. Selling DWSD could be an important part of the solution and the impetus for longer-term growth. 
Mr. Hudson's Op-Ed piece may be a trial balloon by the Bing Administration as it wrestles with huge City budget deficits and is looking for ways to raise cash.  In 2009, the City of Detroit sold the Oakland-Macomb Interceptor to Oakland and Macomb Counties. This transfer was more about shedding responsibility and debt then raising cash. And despite requiring immediate and significant repairs (discussed here, and here), these two counties were glad to assume this responsibility.

Update: Mr. Hudson is quoted again in this May 12, 2010 Fox2 Detroit article promoting the notion of selling DWSD.   
 "I would suggest that they sell it or at least look at the option of selling it. If the deal doesn't make sense, don't sell it. However, not to understand the value of the water department is derelict." also reported May 12, 2010 on this issue (here). 

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