Six-month Moratorium for New Sewer Service Proposed
"We gave ourselves six years to do something about it. Let's stick with what the rules were three years ago. I can't see another moratorium. I'm against it." Jim Pettit Member of Mackinac Island Board of Public Works
By Karen Gould

A proposed six-month new sewer service moratorium is expected to be discussed when City Council meets Wednesday, August 1, following a Board of Public Works (BPW) recommendation made Friday, July 20.

"This is a short time frame," said BPW Chair Thomas Lewand, of the proposed moratorium, "but, on the other hand, a moratorium is a very serious thing."

The moratorium is needed because a six-year rationing program, imposed in June 2004, is at its half-way point and the wastewater plant is running at 85% capacity. The Board of Public Works says it needs time to come up with a plan for the future, since it has failed to reach a consensus in the last three years.

"A lot of this conversation is my fault," Department of Public Works Director Bruce Zimmerman told the board, "because I'm raising my hand and saying the fuse is burning."

The board is looking at three options: Don't expand the wastewater facility, impose tighter rationing to extend the limited capacity longer, or sell bonds to finance a treatment plant expansion.

Capacity of the plant is measured in Residential Equivalent Units (REUs), each unit equal to the water use of a family of four. An REU is also equal to 2.8 hotel rooms or 250 square feet of restaurant.

In 2004, the treatment plant had only capacity to treat another 285 REUs, and all but 110 of those were allocated to platted subdivisions. Another 10 were reserved by the city for public works projects, like restrooms. So following a moratorium on all new construction, the city decided to restrict the number of new REUs it allows to 15 a year, at least three of which will be issued only for single-family homes. They are allocated after a building permit is granted, and each one costs $5,587.

The rationing program was expected to give the city time to decide what to do, but public discussion has been stalled, and 65 REUs remain, only four for this year.

Slowing the depletion of REUs could give the board more time to build up its money reserves, said Mr. Lewand, and see if alternative solutions present themselves.

"We can see how technology develops over the next five years," he said, "We can see how the Island develops."

The board estimated in 2004 the cost to enlarge the treatment plant could be $10 million and take two years to complete. That means the city has a year to make a decision, if it wants to enlarge the plant.

At Friday's BPW meeting, board member Jim Pettit provided the only descending vote for the moratorium. He said the city already had a moratorium in place, had three years to come up with a plan, and has not.

"We gave ourselves three years to do something about it," said Mr. Pettit. "Let's stick with what the rules were three years ago. I can't see another moratorium. I'm against it."

Mr. Pettit later told the Town Crier, "For us to drag on a decision any longer doesn't solve the problem."

Mr. Lewand disagreed during the meeting, saying the new moratorium would slow the issuance of REUs, allowing the board time to reassess Island needs.

The board also asked Mayor Margaret Doud, who attends BPW sessions, to appoint a committee to explore the options available to the Island. The committee would include members of the BPW, Planning Commission, and City Council.

A special committee also was formed in 2004 before those allocation limits were imposed. The new committee will be supported by data on build-out numbers and other information gathered by a consultant, who the BPW would hire.

Abuild-out is the compilation of all land that can be developed under current zoning, to assess how many homes, apartments, and commercial establishments might still need access to the sewer system.

An allocation policy also is needed, said Mr. Lewand. City attorney Tom Evashevski, who was unable to attend Friday's meeting, will be asked to draft the document. Now, with no policy in place, REUs are handed out on a first-come basis until the annual 15 REU cap is reached.

If the moratorium is adopted, the BPW also suggested a "hardship" clause be included in the document's language. Ahardship would address those construction projects already in progress, although the board did not discuss specific requirements that would be needed to meet the hardship criteria.

The August 1 City Council meeting will begin at 6 p.m.

In other business, the board reviewed the budget comparing last year to this year through May 31. While the numbers are unaudited, Mr. Lewand said, improvements have been made to the financial situation of the Department of Public Works.

"The good news is we've got cash in the bank," he said, "which, compared to last year, is a huge improvement."

The department is required to have $300,000 in the bank for a bond issue reserve. The reserve is a contractual obligation and equates to a year of bond payments. In March 2006, auditors noted that the bond reserve was under-funded by $298,000.

"We're supposed to have $300,000 in the bond reserve account, and as you know, the last couple of years we did not," said Mr. Lewand. "We're now $210,000 toward that goal."

So far this year, demands on the water system are lower than projected, said Mr. Zimmerman. So far this year, the water department has pumped 10 million gallons less than last year.

"That equates to 100,000 to 200,000 gallons per day," said Mr. Zimmerman, "which is quite a bit of water."

He offered no explanation as to why the number is lower, leaving to speculation that fewer tourists visiting the Island might be the reason for the drop in water usage.

"We are not selling the amount of water and sewer that we expected to and that we predicted we would," he said. "Our revenues are not going to match or meet our predictions unless something absurd happens."

Mr. Lewand said revenues and expenses "are being watched closely."

The board agreed to hire a consultant to compile salary and pension information on DPW employees from around the state. The consultant is expected to provide the board with a recommendation on whether changes are needed on Mackinac Island. No deadline for the information was set.

Wage and benefit concerns were brought to the board a year ago, and again this year, by board member and employee Jim Pettit.

Mr. Pettit is concerned that Island employees are not paid comparably to counterparts on the mainland and that no pension program is available to them.

"I think it's time we start a study so we have good answers for him," said Mr. Lewand.

Members of the BPW include Chairman Lewand, Victor Callewaert, Ron Dufina, Mr. Pettit, and Andrew Doud.

Their next meeting has not been scheduled.