Other communities should take note of Omaha
September 20, 2012

The City of Omaha faces a $2 to $3 billion cost to separate its stormwater and sanitary sewers over the next two decades. The mandate came down from the EPA, and the city can't avoid making the investment. But $3 billion is a huge amount of money to spread out among a community of 408,000 people -- averaged out evenly, that would be $7350 per person. They've managed to get a little bit of Federal funding, but not nearly enough to cover the entire bill. So the city has sought to spread out the costs differently, so that industrial users pay more -- but that, of course, raises costs for those companies. Many of the targeted companies protested, saying the higher costs could put them out of business or force them to move out of town, which in turn would have left the city still facing the same bill, but with a smaller base of potential payers. After two months of mediation, it's now being reported that a deal has been brokered that will involve higher fees than the industrial users had been paying before, but not nearly the same amount they'd been expected to contribute under the original plan.

Other cities need to pay attention to this story -- they may not face exactly the same issues that Omaha does, but it's a case study in what will undoubtedly be a major challenge in the coming years: Paying for expensive infrastructure projects in a way that doesn't put the companies that employ the taxpayers out of work.

September 2012
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