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Great Lakes Article:

Proposed water deal has escape clause
Aquifer storage approval awaited
Peter Rebhahn
Green Bay Press Gazette
Posted 10/11/2002

A proposed water-purchase agreement between Green Bay and nine suburbs made public Thursday would allow the suburbs to walk away from the deal if the city flunks a state test of a new water storage technique.

“If the results aren’t good, that’s going to mean a major, major problem,” said Brown County planner Mike Parmentier, a consultant to the suburbs.

Aquifer storage and recovery is a technique in which treated drinking water is piped underground into wells for use during periods of peak demand.

Green Bay began the state’s second-ever test of aquifer storage in June.

The Natural Resources Board, the policy-setting arm of the state Department of Natural Resources, voted in August to amend department rules to allow municipal water utilities to use aquifer storage providing recovered water passes a quality test.

Results of Green Bay’s test are expected next spring. Aquifer storage could save Brown County ratepayers millions in coming decades because it would allow the city to delay capital outlays otherwise needed to upgrade its water systems to serve the peak water demands of an expanded user base.

The proposed deal announced Wednesday and released to the public Thursday differs in a few key particulars from a draft agreement announced by the city and suburbs last July.

The new proposal abandons a stipulation that city and suburbs share equally in savings from any deal. The new proposal also allows, but doesn’t require, the suburbs to opt for city water under more expensive conventional terms failing a favorable ruling on aquifer storage from the DNR by Oct. 1, 2003.

“The conventional option from Green Bay doesn’t look real good in terms of costs” for the suburbs, Parmentier said.

The nine suburbs are Allouez, Ashwaubenon, Bellevue, De Pere, Hobart, Howard, Lawrence, Ledgeview and Scott, which operate as the Central Brown County Water Authority.

The suburbs’ fallback plan following an unfavorable DNR ruling would likely be a suburbs-owned-and-operated $135 million Lake Michigan pipeline already endorsed by the authority in 1999. The timing of that decision would leave the suburbs behind the eight ball with respect to tough new federal requirements for allowable limits of radium in drinking water with compliance dates in December 2003 and 2006.

“That’s the risk we’re taking,” said water authority President Len Teresinski.

A new wrinkle in the proposal released Thursday spells out conditions under which the state Public Service Commission would take over rate-setting. The proposed agreement calls for the suburbs to pay the city $1.23 per 1,000 gallons for ready-to-drink water — the same rate the city charges its biggest industrial users.

That rate would increase as needed to allow the city to recover costs of delivering water to the suburbs. The draft agreement announced in July called for the PSC to take over rate-setting authority sometime on or before 2031.

The new proposed deal calls for the city to yield rate-setting authority to the PSC when the city’s profits from water sales to the suburbs hit $60 million — something the authority expects to happen between 2015 and 2020.

“We know because of the additional revenue Green Bay is going to get we’re going to attain that $60 million plateau a lot earlier than 2031,” Teresinski said.

Green Bay Mayor Paul Jadin declined to comment on the suburbs’ new proposal until after a meeting with water authority negotiators today. But Jadin said Wednesday the suburbs’ new proposal contained some “curve balls” and suggested he couldn’t live with some wording in the new agreement.

Teresinski said he talked to Jadin by phone Thursday and downplayed differences.

“I think we’re going to be OK,” he said.

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