Pittsburgh free water about to dry up, rough estimate puts cost as high as $20 million

Pittsburgh could face an annual $20 million water bill starting this year unless the Pennsylvania Public Utility Commission reconsiders a recent order requiring the city to begin paying the Pittsburgh Water and Sewer Authority for total water usage, officials said.

Last year the city and PWSA negotiated a cooperation agreement, in which Pittsburgh would pay the authority for water on a five-year, phased-in basis beginning next January. The city under the agreement would pay 20% of the total bill next year, 40% in 2022, 60% in 2023, 80% in 2024 and 100% in 2025 and every year thereafter.

The PUC on March 26 issued a 204-page order that, among other things, denied the payment plan approved by city council and the PWSA board of directors.

It requires the city to begin paying the full bill as soon as its facilities are metered.

“Private consumers should not be compelled to bear any part of the cost of the service rendered to Pittsburgh except as they contribute as taxpayers to the general fund of the City,” the order states. “The City is a consumer the same as any of its residents who patronize the PWSA and is not entitled to any privilege as to rates.”

Dan Gilman, Mayor Bill Peduto’s chief of staff, said the city doesn’t know exactly how much water it uses because a large number of its facilities such as swimming pools, the Bob O’Connor Golf Course and larger buildings are not metered. The PUC estimated the city uses more than 600 million gallons per year.

PUC scraps residency rule

The PUC also denied a longstanding requirement that all PWSA employees must live within city limits.

Gilman said the city feels the PUC is “way overstepping” in some of its stipulations, including the payment agreement and residency requirement.

“They did not approve our overall new cooperation agreement, which includes the new financial arrangement between the city and PWSA,” Gilman said. “The whole thing was creating a business-type relationship.”

He said the order couldn’t come at a worse possible time as the city faces declining tax revenue and a $127 million deficit this year because of the coronavirus pandemic. He estimated the city’s water bill could range from $10 million to $20 million.

“We don’t know what the number is because the city isn’t metered,” he said. “I can only give you very rough estimates.”

PWSA has retained a consultant to design a plan for metering city facilities. Crews have installed several meters, but the authority expects to begin full-scale replacements after receiving a report in June, according to PWSA Director of Finance Jennifer Presutti.

City appeals rulings

The city and PWSA have filed requests for the PUC to reconsider its order. PUC spokesman Nils Hagen-Frederiksen said the commission has yet to schedule a date for ruling on the requests.

PWSA spokesman Will Pickering said the authority continues to support phased-in billing.

“We’re still moving forward with the cooperation agreement that was negotiated in good faith with the city,” he said. “A staged approach is what makes the most sense. That’s what we’re hoping to achieve.”