Archive | Waste disposal RSS feed for this section

Infrastructure funding in the age of austerity – just don’t call it a “tax”

17 Jan 2017

As demands for municipal services increase, costs go up and tax revenues flatten or fall, what is a municipality to do?  Most Michigan politicians have decided that even to suggest more taxes is the kiss of death.  Everyone agrees Michigan’s roads need work.  The gas tax went up on January 1 and even that increase was widely viewed as an inadequate to fully improve our sub-par roads. Recently, a Michigan State study indicated that nationally, roughly 12% of households cannot afford the cost of water services and, if water rates rise to cover repair and upgrade expenses due to the aging of our systems and other factors, that unaffordability factor may go up to almost 36% in the next five years.

The Governor’s 2016 Infrastructure Commission, appointed in the wake of the Flint Water Crisis, reported that we need a modern infrastructure system to compete globally, to have economic prosperity, and to have healthy citizens and a healthy environment.  However, the Commission did not answer the all-important question of how to fund all of this work.  The Commission reports that Michigan lags behind every other state in the region in capital funding for infrastructure and that Michigan needs to spend $4 Billion more every year than it currently does just to align with an average state and the State’s needs.  This would be a 7% increase in spending.  The Commission did not address how Michigan should fund this shortfall.

The business group, Business Leaders for Michigan issued a report earlier this month. That Report reached the same conclusion and proposed that the State ramp up its spending and opened a door to creative and novel financing approaches including user fees which the Report indicated may be used to fund costs of “services, enhancements to increase the quality of life, and … administrative and regulatory processes.”  This report discusses such fundraising approaches as: fees per mile traveled (vs gasoline taxes); public-private partnerships; fees based on property value increase; fees which take into account all lifetime system costs; selling or leasing systems to raise funds for new infrastructure improvements; toll roads and other more “outside the box” approaches.

We have seen this before but not on a statewide approach such as when municipal governments try to fund environmental initiatives, such as stormwater management (required by federal law). The cities of Lansing, Jackson and Detroit all adopted stormwater “fees” based on the paved acreage of various properties within their jurisdiction.  Clearly, to the municipalities, this seems like a good idea – otherwise, why would they keep doing it? Reportedly, nine Michigan communities have created stormwater utilities to impose such charges (Adrian, Ann Arbor, Berkley, Chelsea, Harper Woods, Jackson, Marquette, New Baltimore, and St Clair Shores).

The Michigan Supreme Court established a three part test to distinguish between a fee and a tax: (1) “a user fee must serve a regulatory purpose rather than a revenue-raising purpose;” (2) “user fees must be proportionate to the necessary costs of the service;” and (3) “user fees must be voluntary.”  Bolt v Lansing, 459 Mich 152, 161-162 (1998)

Unfortunately for the municipalities, the Michigan Courts keep striking these fees down as illegal, hidden taxes.  In the case of Jackson County v City of Jackson, the plaintiffs challenged a stormwater management charge imposed by the Jackson City Council. The Court of Appeals ruled that the charge was a tax imposed in violation of §31 of the Headlee Amendment to the Michigan Constitution. The court held that the charge: (1) did not serve a regulatory purpose because it shifted funding of certain activities from the general fund to the charge; (2) was disproportionate to the benefits conferred upon the payor as there were no payor-specific benefits; and (3) was not voluntary because there was no way to avoid the charge by doing, or not doing, something.   The Court of Appeals cited Bolt v Lansing, which invalidated a similar stormwater charge on similar bases. Ultimately, both courts held these “charges” to be taxes subject to, and failing to meet, Headlee Amendment requirements.

Last year, the Michigan Legislature saw the introduction of a bill that would authorize such “fees,” regarding water and sewer, ostensibly to make them harder to defeat in Court under the Bolt test. The need is real and I am a big believer in top quality infrastructure which needs to be paid for.  My question is, with the 1978 Headlee Amendment that puts the size and cost of government in the hands of the taxpayers, and with a backdrop of fees rising beyond what some citizens can afford – can and should our Legislature try to pass this off by various “fees” without getting the voters’ approval as well as other “creative” solutions, some of which may cost the taxpayers less in the short run but more in the long run?  I’m all for the efficiencies in purchasing and scheduling that Governor Snyder has been pushing for but, as we watch more and more systems fail (like the recent Fraser sinkhole), it is clear that we cannot continue to push this off – if the citizens see that, they should be willing to pay for it. If these expenses get passed on in the form of fees which are not voted on and the citizenry gets hit with larger fees that they were not told about, who thinks that will play well at the voting booth?

What will 2017 Bring? Dramatic Change?

20 Dec 2016

edit_calendar_ssk_47433454In prior years, we knew that regulatory and environmental change was coming but we expected it to be slow and incremental.  With an unknown quantity like President Elect Trump, one thing is clear – no one really knows what may happen.  Here are a few possibilities:

1.  Coal/Cleaner Energy Generation – revitalizing the coal industry was part of Mr. Trump’s midwest stump speeches.  Will Mr. Trump be able to reverse Barack Obama’s Clean Power Plan? What about the Paris Climate Accord?  Certainly, his team is looking at both of those right now. The dispute in Michigan v. EPA, decided in June 2015, continues to rage.  In 2015, the US Supreme Court ruled that the EPA didn’t properly justify its rule governing mercury and toxic pollution (MATS) from power plants because it did not specifically address costs at the initial stage of the rulemaking process. In April, the EPA announced it was standing by its MATS rule and concluded that the benefits far outweighed the costs.  Petitioners continue to litigate whether the EPA properly evaluated costs.  Here in Michigan, new legislation has been passed (and is awaiting the Governor’s signature) intended to encourage additional investment in energy generation and transmission while balancing consumer choice and a greater percentage of renewable energy generation.  Will it work? At a reasonable cost?

2. Power Generation Subsidies/Oil/Gas Generation – Mr. Trump’s attacks on “crony capitalism” would seem to mean that he will stop financial incentives for solar and wind generation.  Will he also attack oil and natural gas supports in the tax code?  Will he open up ANWAR to oil/gas exploration?  Will he scale back attempts to regulate fracking?  This will be difficult in light of the December EPA Report  which concluded that fracking posed problems such as:  fracking water withdrawals compete with other water needs; spills of hydraulic fracturing fluids and chemicals or produced water may impair groundwater resources; injection of hydraulic fracturing fluids into wells may allow gases or liquids to move to groundwater resources; discharge of inadequately treated hydraulic fracturing wastewater to surface water resources; and contamination of groundwater due to disposal or storage of fracturing wastewater.

3. Pipelines – will Mr. Trump reverse the Obama administration’s dim view of oil and gas pipelines such as the Keystone XL and Dakota Access Pipelines?  How will this affect Michigan where public awareness of two 60+ year-old pipelines under the Mackinac Straits has galvanized both sides of the political spectrum into action.  In 2014, Michigan convened a pipeline task force which issued a report in 2015.  In September, 2015, the State entered into a written agreement with Enbridge to prevent the transport of heavy crude oil through the Straits Pipelines.  The task force also recommended that the pipelines be independently evaluated and that additional financial assurance be provided.  The State solicited Requests for Information and Proposals (RFPs) and Enbridge agreed to pay $3.6 Million for the evaluation of the Straits Pipelines.  An independent evaluation of alternatives to the Line 5 pipelines is also underway.  When those will be completed is not known.

4. Infrastructure – Mr. Trump campaigned on infrastructure (although to hear him tell it, that only encompasses airport quality), and Governor Snyder appointed a 21st Century Infrastructure Task Force which concluded that the State needed to be investing $4 Billion more than it was in infrastructure to address roads, bridges, internet, water, sewer and other infrastructure needs.  Given the recent nationally publicized Flint Water debacle, will Michigan find the intestinal fortitude to fully invest in infrastructure or will we continue to patch and delay?  Given the State’s recent fight against a federal judge’s order to deliver clean water, and Michigan legislators “default anti-tax setting,” the future does not bode well.

5. Brownfields – as previously reported, Michigan adopted legislation streamlining its brownfield funding laws and deferred action on Dan Gilbert’s “transformational” brownfield funding legislation.  Will that resurface in early 2017?  I expect it will.

6. Other issues – there are a number of other issues on the horizon including cleanup standards, the maturing of the Great Lakes Water Authority and its ability to deliver clean water and septic services at a reasonable price, Michigan’s effort to reimagine its solid waste program, water withdrawals and protection of the Great Lakes from invasive species and nutrients leading to algal blooms.

Protect the lakes – don’t flush your medicines – here’s how

24 Jun 2016

A few y13445475_10208142314013787_6103794917851915726_n (1)ears ago, the University of Michigan confirmed that it is a bad idea to put old medicines down the drain.  The State of Michigan agrees.  Here  is a link to the MDEQ’s website on this topic.  There have been concerns regarding the impacts of pharmaceuticals on wildlife, as most wastewater treatment plants are not designed or equipped to treat for medicines.

A few years ago, we had to rely on special programs to properly dispose of old medications,  but while recently helping my father-in-law, I learned that there are many more local drop off sites than before.  Here is one website that you can use to locate take-back locations. The Michigan State Police are now taking back medications at their 29 posts. The Oakland County Sheriff has launched Operation Medicine Cabinet with 33 locations across the County – these will accept all dry medicines.  If you have to put medications in the trash, here are instructions on how best to prepare them for disposal.

Why is flushing medicine a bad idea? The UM report talks about creating antibiotic resistant superbugs and there have been other reports about hormonal changes in fish, and finding traces of various prescription substances in drinking water (yes, what we flush can wind up in someone else’s drinking supply).

The votes are in – now comes the hard part

13 Oct 2014

Photo Credit: Christine Cousins, www.christinecousins.com

Photo Credit: Christine Cousins, www.christinecousins.com

Each of the major players (Detroit and Wayne, Oakland and Macomb counties) have now all approved joining the newly formed Great Lakes Water and Sewer Authority; so, we’re good to go and everything is fine, right?  Well, not so fast.  All the votes mean so far is that the Authority exists and that it has four members under the terms of a Memorandum of Agreement and Articles of Incorporation.  Frankly, there wasn’t much doubt that it would be approved and the only question was Macomb.  Once Detroit and Wayne approved it (which was fairly certain), if Oakland or Macomb didn’t, the governor would appoint their representatives and  they could be charged more than those who joined. Landlocked Oakland was a “gimme.” Macomb, with access to Lake St. Clair could have opted to develop its own system – as others have done. (more…)

New Detroit Water and Sewer Deal Announced – harmony reigns — for now.

9 Sep 2014

Photo Credit: Christine Cousins, www.christinecousins.com

Photo Credit: Christine Cousins, www.christinecousins.com

I have blogged previously about the DWSD, arguing that a regional deal makes sense.  I’ve also blogged about rumors that the Emergency Manager was threatening to privatize the system and concerns about funds needed for infrastructure might go into the City of Detroit’s general fund to help the City get out of bankruptcy.  A reported 40 year regionalization deal is now on the table.

if rates look to climb beyond 4% a year – it may be back to a very uncertain drawing board.

There are a number of interesting points in the reported deal, which needs to be approved by October 10th:

1. A regional authority – the Great Lakes Water Authority (GLWA) will be created to operate the regional water and sewer system. The GLWA will have 6 members: 2 appointed by the Mayor of Detroit, 1 each by Wayne, Oakland, and Macomb Counties, and 1 by the Governor. 5 of 6 votes will required for major issues.

2.  Detroit will own and control its own water and sewer system – making it similar to every other community in the system. (more…)

What is a 100 year rain anyway?

14 Aug 2014

Anonymous_two_red_diceAfter the recent flooding, news reporters came out and pronounced Monday a “100 year rainstorm.”  What does that mean anyway?  Is this mere hyperbole, like “trial of the century”?

The term has a specific impact for both insurance purposes and for planning.  Your flood risk determines whether you should buy (or whether you are eligible for) flood insurance.  And I assume that, as to sewer backup insurance (there is such a thing), it also affects your rates.  So, given that we’ve had rain storms in Detroit of over 4 inches 4 times over the last 100 years, what is a 100 year storm?

A 100 year rain storm (like a 100 year floodplain) does not mean that it happens only once every hundred years but rather that, statistically, planners believe that there is only a 1% chance of it happening in any one year.  Think about rolling a die.  If you roll a 3 four times in a row (assuming the die is fair), when you roll it a 5th time, its chances of coming up a 3 (or any other digit) is still 1 in 6 or 16.7%.  Weather is a bit more subjective and variable than rolling a die or flipping a coin but the same concept applies. (more…)

Trade in Honolulu Blue for Green?

5 Aug 2014

largeAs a life-long Detroiter, I know that the Detroit Lions’ colors are Honolulu Blue and Silver, so imagine my surprise when I saw a photo of a green Lions jersey.  Years ago, the Tigers used to wear green uniforms if a spring training game fell on St Patricks Day but this is a bit more than that.

The Lions announced yesterday that they are the first NFL team to join with REPREVE which makes a fabric from recycled plastic bottles.  Repreve and the Lions are launching a consumer education campaign to “Make the Smart Throw,” encouraging fans to toss their bottles into recycling bins instead of trash cans. The Lions are aiming for 100% recycling (at least of plastics). (more…)