Turzai, Wagner, the PWSA & Pennvest

Turzai, Wagner, the PWSA & Pennvest

There certainly was a chorus of rah-rah-sis-boom-bah-ing on the news that “The State” had come to the rescue of the Pittsburgh Water and Sewer Authority’s (PWSA) efforts to replace lead water service lines.

But two unlikely allies offered up separate and spot-on points-of-order that, rest assured, the cheerleaders simply don’t get.

It was on Wednesday that the Pennsylvania Infrastructure Investment Authority (better known as Pennvest) approved $49 million to replace an estimated 2,800 residential lead service lines in 2019. That’s up from the 2,100 lines being replaced this year, covered by $44 million in ratepayer dollars, the Post-Gazette reports

Nearly $14 million of the Pennvest money comes in an outright grant. The balance, and bulk, of the money, $35.4 million, comes in the form of a 30-year, 1-percent loan.

The City of Pittsburgh is under a state mandate to replace those lines. High lead water levels prompted the order in 2016.

Mayor Bill Peduto, of course, praised the grant and loan as having “positive impacts for years.” It could forestall or reduce rate increases, he offered. And a PWSA spokesman said the agency is “absolutely thrilled” with what it says is the largest Pennvest award it has ever received.

We’d all be “absolutely thrilled,” too, if we could offset the costs of our personal nonfeasance (or worse) on third parties, no?

But those two unlikely allies – Pennsylvania House Speaker Mike Turzai and Allegheny County Controller Chelsa Wagner – did the public policy part of this deal a great service by raising two salient points.

First, Turzai, among those to push for the long dysfunctional PWSA to come under the auspices of the state Public Utility Commission, called the baby ugly by clearly defining what the Pennvest deal is – a taxpayer-funded bailout that only gives further cover to “years of city and PWSA mismanagement.”

And that’s indeed the case. The stories of the political machinations and corruption are legion. Why should the price for that dysfunction be spread among taxpayers statewide? Simply put, it should not be.

Turzai further makes the point that socializing such behavior and failure diverts “much-needed money from” truly worthy “water and sewer projects across the state.”

It’s an excellent point. And it calls into question to motivations of Pennvest to make the grant and loan. For as Turzai also noted, to the Tribune-Review, the Pennvest loan is 10 times larger than the agency’s average 2017 loan.

“While no one has been held accountable, the state … bailed out the PWSA, which has been grossly mismanaged for decades,” he added.

Which raises the specter of throwing money down a rat hole.

Controller Wagner got to the nub of the rub, questioning the very efficiency of the PWSA’s line-replacement work. That same $49 million coming from Pennvest would, in other cities’ experiences, been enough to replace many more thousand lines, she told the P-G.

The same PWSA spokesman defended its replacement costs as being comparable to those efforts in Milwaukee and Washington, D.C.

The spokesman, Will Pickering, reiterated that the Pennvest money is “really going to alleviate a lot of the burden on our ratepayers.”

The PWSA had asked the PUC for a 17 percent residential rate hike. That request remains pending.

But, again, what business do taxpayers statewide have in bailing out the PWSA?

Those praising the Pennvest bailout and defending the lead line replacement costs just happen to be part of the same crowd that feigns shock – shock, they say — when anyone has the audacity to propose privatization of the PWSA.

Never mind that the private delivery of water works just fine outside the City of Pittsburgh. Never mind that the kind of dysfunction that nearly collapsed the PWSA never would have been allowed to occur had the service been privatized long ago.

Colin McNickle is communications and marketing director at the Allegheny Institute for Public Policy (cmcnickle@alleghenyinstitute.org).