Corruption or Incompetence?

Oakland Macomb Sewer Interceptor Costs Now At $ 335 Million And Climbing, Cue The Lawsuits

The City of Sterling Heights announced on their FakeBook page Monday that they have filed a lawsuit against Macomb County over their $ 22.2 million portion of the cost for reconstructing the collapsed Oakland Macomb sewer interceptor (OMI), as apportioned by the Macomb Interceptor Drain Drainage District (MIDDD). Sterling Heights believes that the Macomb County Wastewater Disposal District (MCWDD) “did nothing to abate the conditions that likely caused the December [24th] 2016 collapse”. Sterling Heights believes their contract with the MCWDD covers the operation and maintenance of the OMI interceptor.  This may be a little tricky to prove, since the OMI is actually run by the Oakland Macomb Interceptor Drain Drainage District (OMIDDD), an entity independent of and superior to the MCWDD.

Sterling Heights’ contention is that proper maintenance on the OMI by the MCWDD would have prevented its collapse. Maybe. The OMIDDD has already spent $ 170 million on rehabilitation of the OMI since they bought it in 2009. Supposedly the entire 21 mile length was examined and rehabilitated. That rehabilitation effort ended just months before its December 2016 collapse. That collapse suggests that the OMIDDD rehabilitation didn’t do much good. Anyone care to speculate why? Your choices are corruption or incompetence, or both.

This is now a Michigan wide story because our state government will be providing at least $ 5 million of the $ 75 million repair costs for the December OMI collapse. The much debated $ 3 million legislative grant and another $ 2 million from MDEQ.  That $ 75 million is just the current estimate, for the currently acknowledged deterioration of the OMI. Given the Granholm Administration’s role in suckering Oakland and Macomb counties into the OMI purchase, the State of Michigan probably has a lot more responsibility.

The OMI’s repair and rehabilitation costs since 2009 will be a cool $ 245 million after this repair; $ 170 million already spent plus the current $ 75 million estimate. Add in the initial $ 90 million purchase price Oakland and Macomb counties paid to DW&SD, and you are at $ 335 million. Numbers well beyond the currently estimated total costs of the Flint water fiasco, even assuming that the OMI does not continue to deteriorate. Macomb County water rates will probably approach the extortionate rates in Flint before this is all over.

Macomb has 867,730 residents as of 2016; 362,513 housing units. That $ 335 million is $ 924.10 per housing unit, before interest.  Oakland County households may eat some of this, but the overall numbers will be a lot higher due to the miracle of bond interest.  All of this will go right into water bills.  Macomb County residents are about to find out just how much they have in common with Flint residents.

This collapse might have been prevented by proper maintenance, but it is actually rooted in Detroit Water & Sewerage Department corruption and/or incompetence during the OMI construction. Oakland and Macomb County got hung with the cost of this disaster when Oakland & Macomb county officials grossly overpaid for this interceptor in 2009 to subsidize a financially sinking Detroit. The Granholm Administration orchestrated this sub rosa subsidy and put the Director of the Michigan Department of Agriculture on the OMIDDD Board. This devious subsidy didn’t keep Detroit out of bankruptcy, but it has wrecked Macomb County’s finances. Maybe Oakland County’s as well.

Buried in the stories on the Sterling Heights lawsuit is the exciting news that the OMI is in far worse shape than initially reported after this collapse. Another three-quarters of a mile of the OMI is on the verge of collapse. MIDDD has raised their estimate of the repair cost by $ 6.2 million, but this assumes that a relatively new relining process will restore that three-quarters of a mile of the OMI. And that the rot won’t spread further down the 21 mile long interceptor. Optimism is commendable, even when it is unjustified.

Sewer interceptors are major infrastructure projects which are usually designed and constructed to last a very long time. They may be depreciated on a 50 year schedule for accounting purposes, but they are expected to last much longer. There are many interceptors still performing well after 100 years or more of service. OMI seems to be the mayfly of sewer interceptors. Why?

The 15 Mile Road Oakland Macomb sewer interceptor was constructed from 1969 to 1972 by the Detroit Water & Sewerage Division. Jerry Cavanagh was in charge when the project started and Roman Gribbs was Mayor of Detroit when it ended. Cavanagh was too busy trying to repair his reputation after the riots to pay much attention to DW&SD. Gribbs was also distracted, picking up the pieces after Cavanagh’s train wreck. DW&SD was already an unsupervised fount of corruption.  That corruption is on display in the sorry history of the OMI.

The U.S. District Court took over DW&SD in 1978 due to repeated pollution disasters, but only facilitated the corruption and incompetence which had become DW&SD’s brand. U.S. District Court Judge Feikens was never able to increase water rates quickly enough to sate the corruption and incompetence of DW&SD. DW&SD pollution disasters continued unabated and water rates in Metro Detroit skyrocketed.

The 15 Mile Road sewer interceptor (OMI) has actually suffered four collapses since it was built: in 1978, 1980, 2004, and 2016. The first two collapses occurred six and eight years after construction, the second pair of collapses occurred 32 and 44 years after construction. One might get some traction claiming the 2004 and 2016 collapses were due to ‘aging infrastructure’, but the 1978 and 1980 collapses? Since when are sewer interceptors designed to have a six year lifespan?

Detroit Water and Sewerage Department unloaded the OMI on Oakland and Macomb counties in 2009 for $ 90 million. This was 37 years after construction and implied an original construction cost of $ 350 million, if the usual 50 year period, straight line depreciation was used to value the interceptor. The OMI only cost half of that to build, so Oakland and Macomb were, in effect, bailing out Detroit as it collapsed into bankruptcy. This was further evident when the OMIDDD inspected the OMI and had to launch a $ 170 million rehabilitation on 21 miles of the OMI, which was concluded just before its December 2016 collapse. Some rehabilitation.

It is now clear that Macomb County Supervisor Hackel and Congresswoman Miller joined in a bipartisan campaign to oust Macomb County Public Works Commissioner Anthony V. Marrocco during 2016. They knew he was corrupt, and are finding out more every day.  It just came too late to save Macomb County ratepayers from staggering costs. It would have been nice if our nitwit media had publicized some of Marrocco’s shenanigans a few years ago.

The moral of this story is that government corruption and incompetence is rife throughout Southeastern Michigan’s single party controlled local regimes. The Michigan news media is fully complicit in this sad state of affairs. Further, Michigan’s dithering law enforcement and political communities raise the costs of corruption and incompetence into the stratosphere by taking action only after an unmitigated disaster occurs.

Absolute power corrupts absolutely
John Emerich Edward Dalberg-Acton, 1st Baron Acton

You Betcha! (10)Nuh Uh.(0)

  4 comments for “Corruption or Incompetence?

  1. KG One
    May 10, 2017 at 7:14 am

    I haven't had a chance to speak to my snitches over at the Taj Macomb, although it's a safe bet that more than a few bottles of Maalox will be consumed in the coming days.

    It's not widely reported for the same reasons mentioned above, but financially speaking, things are a little precarious in the not-to distant future here in Macomb, and this lawsuit won't help things with the now-delayed bond.

    You Betcha! (5)Nuh Uh.(0)
  2. Sue Schwartz
    May 10, 2017 at 8:06 am

    Ha, Ha 10x25MM and KG One. Corruption just in Macomb, Oakland, and Wayne? "Disposable" sewer systems? And, Sterling Heights is suing Macomb County so that dirty laundry gets aired? Youse guys have all the fun.

    But hey, alls we got up here is $60 Million or so in legacy debt and a couple really stupid commissioners who thinks its correct to sell bonds to pay for this debt which is really interest on top of interest.

    So, here's my plan--each and every individual, corporation, public corrupter, be held to pay for these injuries to the public-going back to Cavanagh as there's no statute of limitations on fraud. We bring back Granholm, Engler, and anyone who had knowledge of this and failed/refused to act, and prosecute under RICO or, minimally, public corruption charges. We convict and seize ALL their assets. We immediately stop paying any pensions to them, and demand they return all this money back to the people. I suppose they could plead diminished capacity--but that wouldn't that slam dunk their convictions?

    You Betcha! (6)Nuh Uh.(0)
    • KG One
      May 10, 2017 at 8:31 am

      I don't disagree with anything posted above, Ms. Schwartz.

      Unfortunately, the decision to begin that process starts with either the county prosecutor, in our case Eric Smith, or Michigan AG Bill Schuette.

      One of the dirty little secrets I've learned about state and local politics over the years is that there is an unwritten rule that going after fellow politicians (even those from the "opposing" party), is strictly verboten.

      Oh sure, the feds will eventually take an interest in what's happening...eventually.

      But by the time they get off of their sorry behinds and that finally happens, well history can speak on those results.

      You Betcha! (4)Nuh Uh.(0)
  3. Sue Schwartz
    May 10, 2017 at 2:24 pm

    Hey, haven't ya heard, we've got Trump--and the dude just fired Comey. Haven't ya heard of trickle-down drain the swamp.

    However, I have a girlfriend in your neck of the woods KG--for years she filed complaints on an attorney for fraud--and she's still doing it. Fast forward years, but specifically three--atty finally got indicted and arraigned by the feds for bank fraud--the exact same fraud she tried to expose years before. Her fraud is well-documented so she sent her packet to the US attorney's office upon learning of his indictment.

    From the time he was arraigned until now, they been in " plea agreement status" whatever that is. It's been so long, that his attorney wants to quit the case. Two weeks before this guy was indicted, he filed an application for a loan for 30K. The entire application was fraud, and now, of course, that bank is suing to get their money back. I truly believe the reason for the delay between arraignment and now, is in that three years, many of the judges, and others who looked the other way--no, I take that back, judge's who gave out court orders allowing this guy to forge documents and stealing from his clients, and conspired to throw his clients in jail, and are absolute co-conspirators in this guy's scheme have retired from government service. I cannot see how they can indict this attorney and not indict his co-conspirators who obviously were getting kickbacks. Maybe they've turned states evidence against him.

    You Betcha! (3)Nuh Uh.(0)

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