To investigate the possibly of future water rate increases, Baltimore City Council President Bernard C. “Jack” Young on Monday will request a hearing to discuss a request by the Department of Public Works to borrow up to $2 billion.
The city is obligated to improve its aging infrastructure under a 2002 agreement with the Environmental Protection Agency and Maryland Department of Environment. To help meet those obligations, the Department of Public Works requested legislation that would authorize an increase in the city’s borrowing capacity.
Young will introduce a resolution at Monday’s City Council meeting to request the hearing. The hearing will investigate the city’s remaining obligation under the consent decree with the federal government – which calls on the city to spend $1 billion over 14 years to improve the wastewater collection – and its impact on future water rates.
“I understand the fact that we’re legally obligated to meet the terms of this unfunded federal mandate, but we have a responsibility to explore whether it’s fair to ask the citizens of Baltimore to shoulder the brunt of paying for more than $4 billion worth of improvements,” Young said in a statement.
Water and wastewater rate increases were approved by the Board of Estimates last July. The rates were increased by 15 percent in the current fiscal year and will rise by 11 percent in each of the next two fiscal years.
Mayor Stephanie Rawlings-Blake said at the time that, “Crumbling infrastructures have reached a crisis point in cities across America, including Baltimore. With unfunded federal mandates, limited resources and a system that is literally crumbling, we have no choice but to pay more to keep our system working.”
Young, who chairs the board, and Comptroller Joan M. Pratt voted against the increases. In addition to the mayor, Alfred H. Foxx, the then-director of the Department of Public Works, and Deputy City Solicitor David E. Ralph voted for them.
A date and time for the hearing will be announced at Monday’s meeting.
Jeffrey Raymond, spokesman for the Public Works Department, said the request to borrow up to $2 billion more is based on the anticipated capital program over the next six years.
"A three-year rate schedule went into effect on July 1, 2013, and has two years left to run," Raymond said in an emailed statement. "Selling bonds, especially at these extremely low interest rates, is a universal way of doing business to fund long-term projects. This is standard procedure to ask for this approval."