O'Fallon Progress

Letter to the Editor: Let’s review potential lease of wastewater system in detail

To the Editor:

I attended one of the informational meetings conducted by the city about leasing our water and waste disposal systems to a private, for-profit corporation. One display indicated the city would receive payment in excess of $50 million for such a lease contract.

The display further stated that the lease would fund projects listed in the city’s strategic plan. This sounds enticing until you recognize that the lessee will require the money to be repaid with interest.

The Environmental Protection Agency in a Response to Congress on Privatization of Wastewater Facilities stated “any payments a local government receives from the sale or lease of a wastewater infrastructure asset represent a loan from the lessee which must be repaid with interest by the wastewater users in the form of additional user fees.” The repayment of this loan to fund strategic plan projects will be added to our water and sewer bills, creating a higher cost for the consumers.

Another display indicated that our real estate taxes may need to be increased by $395 per year on a home valued at $150,000 in order to fully fund an anticipated $4,900,000 necessary to fund the strategic plan’s street and storm water program. I don’t care for the inference that real estate taxes may increase if the city does not enter into a lease for our water and sewer infrastructure.

Real estate taxes account for only 11 percent of the city’s income. The other 89 percent comes from multiple other sources, some of which can be used to fund street and storm water programs. Good streets and storm water drainage systems in all areas of the city are necessary and should be properly funded. There are funding projections for other strategic plan programs that may be desirable, but not necessary, such as $28 million for completion of our regional Family Sports Park. Perhaps a substantial part of this money could be allocated for streets and storm water. This is a higher priority.

The city council approves and provides funds for the strategic plan. If the current plan cannot be implemented in an affordable manner without increasing real estate taxes and without leasing our water and sewer system, then the council should develop a plan which is affordable. The city’s strategic plan and budget are choices made by the city council, not urgent mandates. Leasing our water and sewer system to a private, for profit corporation or increasing our real estate taxes are not solutions for an unaffordable strategic plan.

Please find information at “foodandwaterwatch.com” to help you make a better decision about leasing our water and wastewater system.

Bob Kueker