State help may be on the way to help Highland Park pay off its water debt.
State Sen. Stephanie Chang (D-Detroit), whose district includes Highland Park, spoke at a community meeting in the city on Wednesday, informing residents that the Michigan Senate’s Department of Health and Human Services committee’s proposed budget includes funding to pay off Highland Park’s water debt.
This could resolve most of the city’s current water debt if the budget is passed out of the legislature and signed by the governor. Chang added that, based on meetings with Gov. Gretchen Whimter’s office, she didn’t believe the governor would allow water shutoffs or emergency management in the city.
Over 60 people showed up at Highland Park’s Ernest T. Ford Recreation Center to get answers from Chang and others about the estimated $24 million water bill facing the city and offer their ideas on how to handle the crisis.
Residents also came to push back against a media narrative several attendees said had portrayed them as “deadbeats,” arguing that they had paid their water bills and wanted to stay in their homes.
A Wayne County Circuit Court ruling would allow the Great Lakes Water Authority to use a levy to collect the debt by placing charges on the property taxes of residents and businesses, a potential hardship for many in the city where the poverty rate is 41%. Highland Park’s yearly property taxes are just $9.6 million, less than half the money GLWA says it owes.
Before the ruling, Highland Park asked the state to expedite the process of entering municipal bankruptcy.
Highland Park resident Charlene Johnson told Planet Detroit she was concerned about the debt being placed on residents’ property taxes or that the city’s water would be shut off, which she said would be “disastrous.” She said that residents were not to blame for the water debt.
“We have paid our water bills all these years,” she said. Johnson hopes the state will forgive Highland Park’s debt to GLWA and help the city reopen its water plant, which the state shut down in 2012.
Whitmer previously said GLWA could use a $25 million state drinking water grant to help with the debt. However, Macomb County Public Works Commissioner Candice Miller told the Detroit News that the money should be used to reimburse suburban communities that she said covered Highland Parks’ water bills over the past decade.
Whitmer’s office did not respond to Planet Detroit’s request for comment.
Those in attendance had their own ideas for how to manage the crisis and prevent issues like this from happening in the future. These included restarting the Highland Park water plant and placing water utilities under the authority of a body like the Michigan Public Service Commission (MPSC), which oversees energy utilities, to give residents greater recourse during disputes.
Chang expressed support for regulating water utilities but said her immediate priority was pursuing statewide water affordability legislation. The idea of regulating water utilities has come up before. In 2015, Rep. Kurt Heise (R-Plymouth) introduced legislation that would have given the MPSC power to regulate public and private water utilities.
Highland Park Mayor Glenda McDonald said state leaders were unlikely to leave Highland Park’s problems unaddressed in light of recent water crises in Michigan cities and places like Jackson, Mississippi, where disinvestment and extreme weather have shut down the city’s water supply twice since 2021.
“They don’t want another Flint on their hands,” McDonald said.
Yet, it’s unclear how quickly a resolution could arrive. The state may not finalize a budget until the end of the summer, and Chang said the governor’s office is working through the steps required under Michigan’s Public Act 436, Michigan’s financial emergency law. Bankruptcy is one possible outcome of this process, which could mean selling off city assets and nullifying contracts like the one with GLWA.
Highland Park voted to begin the PA 436 process on April 10 and later asked the governor to expedite a Chapter 9 bankruptcy filing for the city. The financial reviews required by PA 436 would ordinarily take months. However, Whitmer spokesperson Bobby Leddy pushed back on the city’s request for a quick resolution to the PA 436 process, saying “they cannot skip to the end.”
Yet, Chang told the crowd in Highland Park that “this is not a typical situation.”
Judge Edward Joseph gave the two parties until May 31 to devise a plan to settle the bill. Charges from GLWA could show up on city property taxes as soon as this summer, leaving the city a short window to get help from the state or secure a bankruptcy filing.
On Wednesday, Mayor McDonald continued to dispute the debt that GLWA says it owes.
“There is no way on God’s green earth that Highland Park owes this much money,” she said.
Highland Park City Administrator Cathy Square said in 2022 that the city received an unmetered bill from the utility because of the emergency water hookup the state ordered in 2012. She said the city installed meters on homes and businesses and found it used a fraction of the water for which GLWA had billed it.
In a statement to Planet Detroit, Randal Brown, general counsel for GLWA, said, “DWSD (Detroit Water and Sewerage Department) and now GLWA have used the best available data to determine Highland Park charges. This has included using Highland Park’s pumpage data from its water treatment plant and temporary meters.”
He previously said leaks in the city’s water pipes account for the high charges. Square contradicted such claims in 2022, saying that Highland Park hired experts to look for leaks and found none.
But McDonald insisted that her issue was with GLWA and not the state. She said she was working with lawmakers and the governor’s office to find a solution to the debt issue, saying, “whatever it is, you will not lose your home.”
These words may have registered with Janet Spight, who has lived in Highland Park for almost 60 years. She said having a lien put on her home was her greatest concern.
Yet, aside from the water debt, Spight said things were looking up for Highland Park, with property values increasing and new businesses moving in.
“We’ve got to survive this,” she said. “Highland Parkers are strong people; they support one another. And so I believe that this too shall pass.”