Philadelphia is changing how it sets water rates

For years, officials in the Philadelphia Water Department have had the last word on the cost of water, but that is about to change.

Thursday, a City Council committee moved one step closer to approving an independent board charged with approving or rejecting any requested changes in water rates. Council’s Committee of the Whole approved all five nominations the Philadelphia Water, Sewer, and Stormwater Rate Board.

One nominee is Bernie Brunwasser, the former head of the Water Department, who says that the water department’s challenge is to appeal to Wall Street investors even as it remains affordable to Philadelphia residents. The department depends on bond issues to finance its massive infrastructure needs, says Brunwasser, and it can’t attract bond buyers if its financial fundamentals are unsound.

At the same time, he says the city’s residents, many of whom live in deep poverty, must be able to afford the department’s services. “Philadelphians deserve the best, so it is incumbent for the new Philadelphia Water, Sewer and Stormwater Rate Board to help keep the Water Department on top, while being mindful of its customer’s ability to pay,” Brunwasser said.

Among the department’s challenges are the numerous federal mandates that set rules for stormwater management and environmental protection, but don’t come with cash to pay for them. “One major challenge the Water Department faces, like many similar utilities across the nation, is finding a way to meet all current and future federal regulations while keeping the cost of water affordable,” Brunwasser said. “This will not get any easier in the years to come.”

Council will take a full vote on the subject next week. The board was the brainchild of Council President Darrell Clarke, who was dissatisfied with the old system under which Water Department officials would propose a change, host a series of public hearings, then allow the Water Commissioner to make the final decision.

The new system will provide a new check to balance the Water Department’s power, Clarke said.

“This will be a real board,” said Clarke. “It will have substance, it will have teeth, it will have jurisdiction, but most importantly it will be done in a very transparent way.”

A water department spokesperson called the new board’s proposed members “highly qualified” and said the department looked forward to working with them. In addition to Brunwasser, other nominees include Nancy Winkler, the city treasurer; Sonny Popowsky, who once served as the Consumer Advocate of Pennsylvania; Lee Huang, a consultant specializing in economic development and public finance, and Mike Chapman, a local businessman with the Chapman Auto Group.