Water-borne corruption

City of Detroit

The masterminds behind the deal giving the suburbs greater representation on the Detroit Water and Sewerage Department (DWSD) board didn’t get it right. Changing the board’s composition doesn’t come close to addressing the persistent corruption problem. No member of the water board has ever been accused, indicted or convicted of wrongdoing.

Under an agreement negotiated by Federal Judge Sean Cox, Mayor Dave Bing and suburban leaders, Detroit will maintain its majority control.  Officials from Wayne, Oakland and Macomb will each recommend one member to be appointed by Bing. Federal oversight will end within six months. Rates and a five-year capital improvement plan would need a super majority vote for passage.

While public officials were patting themselves on the back, critics blew a gasket. A few City Council members threatened Mayor Bing with legal action for failing to get approval from the council before structuring the deal – others sheepishly approved. Detroit activists loudly protested what they perceived as a threatened takeover of “their” water system. State Representative Kurt Heise, R-Plymouth Township remained resolute in pursuing legislation to create a regional water authority.

Nothing in the deal will make the DWSD less vulnerable to sleaze.

Why? The department’s flawed contract-letting process is prone to questionable management practices, cronyism and favoritism. A former mayor, his father, some of his friends and the former DWSD director have just been indicted on bribery and extortion charges. These indictments are the latest example of pay-to-play schemes, political kick backs and pay-offs that occurred over the years.

Restructuring the board won’t fix the malfunctions.

A federal probe pinpointed the problem by exposing how some city officials received direct, indirect, and in some cases illegal payments from potential or current DWSD vendors. With campaign contributions free-flowing from contractors into the pockets and coffers of the City Council, it’s easy to see why its members want to protect the status quo.

The go-along, rubber stamp attitude of the water board also contributes to contract machinations. Thus, the new deal brings into question whether the issue over board representation is merely an attempted diversion from the system’s unresolved fraud contamination.

For all its problems, no one has even hinted that the DWSD delivers   anything but safe, high-quality drinking water. Detroit’s combined wholesale water and sewerage rate is relatively low compared to other systems across the country. Since communities tend to mark up the charge to their customers, there can be huge differences in what Detroit charges and what suburbanites ultimately pay.

Considering how many political deals are in play on any given day, though, it’s amazing that the department is able to put out an acceptable water product at a “reasonable” price. Still, political contagion of the department increases the overall cost of operation which is passed on to city and suburban consumers. And therein lies the problem. The relationship between criminal wrongdoing and the DWSD won’t end until there’s a change in who calls the shots on contracts, not who approves rate increases.

Government-owned and operated water utilities are often deficient when it comes to delivering services. Competition may eliminate some unlawful activity. Some cities have privatized the management of their water system while realizing cost savings and restored credibility.

In a perfect world, corrective action is left to the local government. But Detroit officials make a good case for placing the DWSD under regional control by not safeguarding a contracting process that historically bleeds corruption.

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