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Friday, May 13, 2016

Highland Park financial woes spread to the suburbs

Posted By on Fri, May 13, 2016 at 2:49 PM

click to enlarge PHOTO: SHUTTERSTOCK
  • Photo: Shutterstock
Suburban homeowners are in for a surprise. 

Starting July 1, suburban sewer bills are expected to rise by 3.2 percent, reports the Detroit Free Press. The spike is being attributed to unpaid bills from the city of Highland Park. 

"If they’d been paying their sewer bills on a regular basis, the average increases would be 1.7 percent," Great Lakes Water Authority Chairman Robert Daddow tells the Freep. 

According to the GLWA, which took over for the Detroit Water and Sewerage Department in January, the city of Highland Park owes nearly $30 million in unpaid bills (while most of the money owed is from delinquent sewer bills, it is estimated that about $3 million in water bills are owed since 2012). In 2015, DWSD won a lawsuit against the city over the debts, and expected to collect $19 million; however, Highland Park appealed, and since the case is pending, DSWD and now GLWA are prohibited from trying to collect the money. 

What complicates this story is that Highland Park isn't cooperating. The city has sued Wayne County and the Michigan Department of Transportation, claiming that their costly water bills are for services rendered by these entities as they allege that the duo, "paid for storm water services up to the border ... of Highland Park for all of their storm water runoff with full knowledge that they are paying nothing for the same services provided within Highland Park city limits."

The GLWA, which absorbed the debt owed to DWSD, wrote Gov. Snyder a letter in April asking for his "personal intercession and involvement" in the matter of Highland Park, seeing as the city — which Snyder declared a financial emergency in 2014 — is under a state-mandated plan of adjustment. 

"If a community lacks the resources to utilize its police power to provide for the basic sanitary health needs of its residents and fails in its basic administration efforts to bill its citizens for services rendered, isn't it time for the state to step in and assist?" the letter implores.

According to the Freep: "Snyder spokesman Ari Adler said the governor would not be personally involved in the discussion, but the state plans to talk with Highland Park and the water authority about the issue and advise the city further about finances." 

What to do with Highland Park and this lingering debt has been an issue for years. In 2015, when Michigan bigwigs met in Mackinaw for the yearly policy conference, the debt was brought up as plans for the GLWA — a consortium made up of Detroit and Wayne, Oakland and Macomb counties — was discussed. Given the money, presumably, owed by Highland Park, one idea that was thrown on the table was dissolving the city. 

According to the Detroit News, however, Oakland County Executive L. Brooks Patterson, and Macomb County Executive Mark Hackel disliked the idea, as it would mean the debt would be absorbed and ultimately pushed on to customers across the authority. 

"It's not the responsibility of the suburbs to cover Detroit and Highland Park's arrearage," Patterson told the News. "That's a deal-breaker. I can't go to my taxpayers and tell them I agreed to this."

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