It seems unlikely that Louisville Metro Council members will approve a large sewer rate increase after a contentious budget hearing Wednesday.
On the table is a proposed 20 percent rate increase — the largest Louisville’s Metropolitan Sewer District has levied in eight years. The MSD board approved the change last month, and at Wednesday’s committee meeting executive director Tony Parrott made his agency’s case for the rate hike.
“We hear about the prosperity of Louisville and Jefferson County and what it means to move forward, supporting the corporate base that we have. I don’t think you can have that conversation without recognizing that sewer and drainage is a very important component of that,” he said. “Bottom line, we cannot be an asset to transform Louisville when we still have the flooding and the overflows that we have and the street flooding in our community.”
The city’s infrastructure is aging, Parrott said. And while progress needs to continue on an $850 million federal consent decree to reduce sewage overflows into the Ohio River, without a drastic rate increase, other pressing needs — like viaduct flooding near the University of Louisville — won’t be addressed.
Greater Louisville Inc. — the city’s chamber of commerce — came out Wednesday afternoon against the rate hike. In a statement, GLI chief operating officer Sarah Davasher-Wisdom said the organization wouldn’t support such a large rate increase, though the group is concerned about deteriorating infrastructure and believes an increase larger than 6.9 percent is warranted.
Metro Council members were unmoved by MSD’s case.
“As far as I’m concerned, there are no new surprises here,” said 26th District Councilman Brent Ackerson, saying MSD has known for years that the infrastructure is aging and still only projected moderate rate increases until now. “Did someone screw up or what? How is it all of a sudden, all the things we’ve been told for years … the average person’s income, inflation is 2 or 3 percent. And every year, MSD manages to double or triple that. It’s the greatest racket in town.”
Parrott, who has been on the job and in Louisville less than a year, said rates have been kept artificially low while MSD has gone to the bond market to finance big projects like the consent decree.
“I’m not going to throw any previous administration under the bus,” he said, adding that now, the agency doesn’t have enough bonding capacity to pay for the rest of the federally required projects.
Other council members questioned MSD’s spending and told Parrott that his agency had failed in public outreach. Councilman Bill Hollander, D-9, said the agency needs to convince Louisville residents of the necessity of the infrastructure improvements before such a large rate increase should be granted.
“I am not convinced that MSD doesn’t need this money to prevent some imminent problems for the community. I am not convinced of that at all,” he said. “I am completely convinced, though, that you haven’t made a persuasive case to the public and to the council for that.”
Any rate increase larger than 7 percent must gain Metro Council approval. Parrott said because that approval didn’t seem likely, he plans to go back to the MSD board at its meeting later this month and recommend they approve a 6.9 percent increase.