If you listened very carefully to the words of the City’s General Manager for Utilities, Herb Niederberger, at the URAC meeting on Thursday, he presented, if there were no pending lawsuits, a way forward for the city on roads. The problem, of course, is the no lawsuit portion of that way forward.
Michael Harrington has not overtly tipped his hand on this, but most people expect a lawsuit. The biggest danger, however, is that he has another, potentially much stronger, card to play than a lawsuit.
A lawsuit here is not unproblematic, however. One source told the Vanguard that Mr. Harrington’s lawsuit cannot halt the water project at this point. However, it could derail the possibility of getting the financing that would save the ratepayers at least $50 million on their base rates.
The city will be able to get financing regardless, but at a much higher cost. Mr. Harrington has taken pride in the fact that his petition for referendum resulted in a better project at a much lower cost, however, that starts to reverse itself if he continues to attempt to block the project from going into effect.
The city has laid out their scenario – the council figures out new rates by July 1, and puts it forward to a Prop 218 process implemented by October 1 and they can go forward largely unscathed.
However, the city is not taking into account the interaction between council action and the community. Already Mr. Harrington is signaling that there needs to be a new rate study and that the rates need to be on the November ballot for voter review. The presentation materials from Bartle Wells at Thursday’s URAC meeting clearly signaled that the rate study portion of Mr. Harrington’s requirements is well under way.
While it seems unlikely that the city would agree to put the rates on the November ballot, Mr. Harrington at this point has the momentum and incentive to attempt to force the city’s hand.
And, while it is clear the city views Mr. Harrington as an annoying gadfly at this point, they have not exactly helped their situation.
First, from the start, back in late 2012, the Vanguard, Matt Williams, Michael Harrington and others all suggested that the city needed to have the rates completed before and/or tied to the ballot measure. Instead, the city insisted it was sufficient to pass a free-standing Measure I and have a separate process following Measure I for the Prop 218 hearing.
The Vanguard warned the city at the time that this was a bad idea, however, Harriet Steiner insisted. The result is that, after that process wrapped up, the opposition simply took their time and got the signatures needed to put the rates on the ballot.
Second, the city did not take the threat of the Measure P initiative seriously. Much as it had a huge amount of time to discuss the city’s fiscal position with the voters, the city had a huge amount of time to educate the voters about CBFR, the advantages, why it was better to go to this model rather than a traditional model with meters representing a huge percentage of the fixed cost, and thus forcing a much higher per gallon rate on low-end users.
The opponents of Measure P were outworked and outspent on the campaign and paid dearly.
Third, there was already a substantial level of distrust by the voters on the water rates and the overall management of the city, and that was amplified by revelations late in the process that the city had switched the rates without notifying council, and other factors.
People want to blame Michael Harrington for all of this, but the city bears huge responsibility for creating a climate where the actions of Michael Harrington and other activists were able to succeed.
The URAC wants to study the rates, but this is all a lesson in futility unless the city can set forth a process that all agree to.
While the city sees a lawsuit as a potential threat to the rates, a bigger threat is another ballot initiative that would push the question well past the October 1 timetable laid out by Mr. Niederberger.
Is the city council going to finally agree to put the rates on the ballot as Matt Williams and others suggested back in 2012, or will they allow the process to be subjected to chance? Will they risk that Mr. Harrington will not follow through and force the issue onto the ballot again or that the voters will be more understanding of their position this time around?
These are huge stakes and already the process seems to be moving in the wrong direction.
—David M. Greenwald reporting