A Government-Run Water Utility?
Borrowing tens of millions of dollars and creating a government-run water utility has been floated by Mayor Paine and some members of the Superior City Council. A government takeover of the water utility would:
Be expensive.
The city would have to take on tens of millions of dollars in debt to take over the water utility. Would the burden of these debt payments lead to higher taxes or cuts in other municipal services? No one knows for sure–but no matter the outcome, everyone in Superior is on the hook for that debt.
Put the city government in charge.
The city has no prior experience running a water utility, and taking on this responsibility now would strain its already limited capacity amid other pressing issues, including:
Managing rising property taxes
The recently launched and expensive city-run broadband project, ConnectSuperior
Take years.
Taking over the water utility would require a city-wide vote, and if it passed, then have to go through a lengthy regulatory process to determine the final price.
After the regulatory proceedings, these takeovers almost always end up in court, which could take years and cost millions of dollars in legal fees. (When Missoula, Montana took over their water system, they ended up paying over $16 million in legal fees!)
Be risky.
By the time a government takeover is completed, there is a real risk that the federal money to help replace lead lines will have dried up. If that happens, customers will be responsible for 100% of the cost of replacing their lead service lines.
Tens of millions of dollars in debt, transition costs, and legal fees would strain the new city-run utility and could jeopardize needed investments and upgrades.