Nagin pushing bills
to restructure S&WB
One measure would eliminate agency
Thursday March 18, 2004
Martha Carr and Frank Donze
In his latest attempt to radically
restructure the New Orleans Sewerage & Water Board, Mayor Ray Nagin
said Wednesday that the city is considering pushing two bills in the
upcoming legislative session: one that would remove City Council members
from the 13-member board, and another that would make the quasi-state
agency a part of the city's Public Works Department.
Nagin also said he will make a
decision "shortly" regarding the proposed privatization of the
city's sewer and water systems, announcing that after almost five years
of debating whether to hire a private operator, it is "time to fish
or cut bait."
"We allowed the privatization
process to continue to go forward, with the thought that if we could
have three companies that would bid and could guarantee us a certain
amount of savings, we would continue," Nagin said at a City Hall
briefing where he outlined his agenda for the Legislature's regular
session, which begins March 29.
"We've had at least that number
of companies express interest. It's just a matter of whether they are
going to formally bid or not."
Since he took office almost two years
ago, Nagin has been sharply critical of the water board's
inefficiencies, and has made no secret of his intention to wholly change
the way it operates.
The question remains, however, whether
Nagin can get the legislative support he needs to eliminate one of the
city's most highly politicized boards, which is laden with appointees
from multiple mayors.
State Sen. Lambert Boissiere, D-New
Orleans, who Nagin said had agreed to sponsor both bills in the Senate,
said he has yet to sign off on either of the mayor's proposed reforms.
While he believes some changes are needed, Boissiere said, he's not
convinced the water board should become part of the city bureaucracy. He
also said he has questions about Nagin's proposal to model the S&WB
after the New Orleans Dock Board, a much smaller agency that operates
without elected officials.
The deadline to pre-file bills for
the upcoming session is Friday.
"Just changing the board's
structure will not solve the problem," Boissiere said. "And I
don't think I'm ready to support making it a city agency. I want (the
Nagin administration) to make their case and I will listen. But I think
most of our constituents would have some concerns about putting the
board directly under the mayor and seven City Council members."
The least radical of Nagin's reforms
is a proposal to downsize and depoliticize the water board, which now
consists of the mayor, three council members and nine mayoral appointees
who serve nine-year terms.
For years, board critics have said the
governing structure is unwieldy and unproductive, mostly because members
have competing political alliances depending upon which mayor appointed
them. City Council members on the board are also regularly conflicted,
because the council must approve water and sewer rates as well as the
agency's annual budget.
Nagin said he thinks the board would
work better if it were structured like the Dock Board, which consists of
seven members who serve staggered five-year terms. Appointees are
nominated for the job from a slew of agencies, including maritime
industry organizations, academic institutions, and chamber of commerce
groups. A committee then whittles the list to three, and sends those
names to the governor, who has the final say.
It was unclear Wednesday whether Nagin
intends to follow the Dock Board structure strictly.
Councilman Eddie Sapir said he's
overwhelmingly in favor of removing council members from the board --
even if it means losing his appointment.
"However it's done, I know it's
in the best interest of the citizens and the ratepayers," he said.
"I told the mayor I will hold his hand, go to Baton Rouge, and do
anything to make it happen."
But Councilman Marlin Gusman, who also
serves on the board, said he's more skeptical about the idea.
"I would be extremely wary of any
proposal that seeks to insulate voter participation with something like
the Dock Board," he said. "That is something controlled at the
state level without any involvement of any (local) elected
representatives. Anytime we are talking about major issues involving
rates and things as important as water and drainage, it's important for
the people to have a voice in that process."
A new structure
Nagin's second, more controversial,
proposal is to abolish the quasi-state agency and fold it into the
city's Department of Public Works, an arm of city government headed by a
mayoral appointee whose primary duty is oversight of street construction
and maintenance. In the long run, the mayor said, it would be a more
efficient and less expensive way to provide basic services to residents.
"We've looked around the country
and we've seen lots of municipalities that have a sewerage and water
board as part of their public works department," he said.
The mayor said the timing is right for
such a merger, now that the agency has been stabilized financially -- at
least for now. Last year, the City Council approved three years' worth
of sewer rate increases. The board also hired Morgan Stanley to
refinance much of its debt, and hired RIS New Orleans to begin running
fiber-optic conduit on sewer lines -- infrastructure that Nagin believes
the city will be able to lease to telecommunications providers.
Nagin said the prospect of savings
from the refinancing and the potential of new revenue from the
fiber-optics proposal have lessened "the pressure" to
Nonetheless, he said the privatization
debate will soon be settled, when he gives private companies interested
in running the city's sewer and water systems a deadline to say whether
they will submit bids.
"We will be settling that very
soon -- very soon," he said.
The water board began entertaining the
idea of hiring a private operator in 1999 as a way to stave off rate
increases while financing millions in sewer improvements mandated by the
federal government. The city's first bid process ended abruptly in
October 2002, after a coup by privatization opponents resulted in a 6-5
vote to reject all bids. Nagin restarted the process last January, but
it's been stalled for at least six months.
Nagin's other ideas
Other proposed legislation that Nagin
hopes to push in the upcoming session would:
-- Create a new agency to oversee
development of dormant sections of the city riverfront. While details
are still sketchy, Nagin said the board likely would include
representatives of City Hall and the Port of New Orleans, which owns the
vast wharf space along the Mississippi River. In the past, government,
business and civic leaders have argued that the city should take a more
aggressive approach to developing waterfront property into everything
from parks and event venues to residences, hotels and cruise ship
-- Change state laws that prohibit
international banks from operating in New Orleans. Nagin said banks
based in foreign countries are prospering in cities like Miami, Houston
and Dallas. He estimates that each bank that could be lured here would
create 75 to 100 jobs.
-- Secure the full $3.6 million
reimbursement from the state that the city says it is owed for expenses
related to Harrah's New Orleans Casino. While the city has made the same
request in past years to pay for extra expenses it incurs, such as
increased police, fire and sanitation costs, the Legislature has been
reluctant to comply.
In 2002, Nagin's first year in office,
the city got nothing and last year it received only $1 million.
Administration officials said they will seek a total of $9.8 million
this year in an effort to recoup the money the city failed to get the
past two years.