A Streetcar Named Cooperation?
Republicans force city to pay to relocate utilities for streetcar and Barrett calls for cooperation from We Energies to keep costs down.
Last week had lots of news related to Milwaukee’s planned streetcar system. On Wednesday, the state Public Service Commission ruled that the city must pay all the costs of utility relocation for the streetcar project, which was a blow to the city. But by then it was already becoming clear the costs of relocation were dropping significantly, which was good news.
The Public Service Commission ruling had been expected after a series of Republican-led legal maneuvers over the past two years. In September 2012 the PSC appeared close to ruling for a compromise that would have capped costs for the utilities for any relocation at $10 million. During the meeting Commissioner Eric Callisto stated, “We have two votes for a police power exercise,” meaning the city was correct in arguing the utilities must pay at least a portion of the relocation costs. But after a curious break in the meeting the commissioners voted to hold off on taking the vote. Commission Chairman Phil Montgomery explained that this was simply to allow Commissioner Ellen Nowak “one more kick at the cat.” As it turned out, it allowed time for the state legislature to take another kick at the cat, the animal in question being Milwaukee. Because in May 2013, Rep. Dale Kooyenga (R-Brookfield) passed a budget motion that changed long-established precedent for such projects and pushed the costs of utility relocation onto the city. Once this occurred the ruling by the PSC became inevitable, if a year in coming.
That would have been a huge blow, had the original estimated cost of $55 to $70 million for utilities relocation been accurate, but city officials have been working for some time to lower the costs. By Tuesday, on the day before the PSC ruling, as a story by reporter Sean Ryan of the Business Journal made clear, the cost had dropped to as low as $20 million and could turn out even lower than this. Ryan quoted Ghassan Korban, Milwaukee Department of Public Works commissioner: “The $20 million estimate is not definite, he said, and will change as Milwaukee continues to coordinate with utility companies to minimize relocations.”
As part of the city’s effort to reduce the cost to the utilities, in January 2014 the city received approval from the Federal Transit Administration to move a section of the track from N. Broadway to N. Milwaukee St. Ryan reported that according the city Engineer Jeff Polenske, “The change eliminates $10 million in construction costs to move underground AT&T communication lines, and avoids moving 2,000 feet of steam tunnels and 2,000 feet of electrical ducts.”
The Journal Sentinel Editorial Board also weighed in on Thursday with a opinion titled, “City should appeal PSC on streetcar costs.” The editorial noted that, “The city has worked hard to adjust the route and negotiate with utilities to bring down the price of moving utility lines. An original estimate of around $55 million for relocation costs is now at $20 million, and that’s before the final engineering stage of the project has been done.”
It appears the JS will get their wish as the city attorney’s office issued a release indicating it would recommend an appeal, but will Barrett get his wish for better cooperation on the part of We Energies and the other utilities? We’ll see.
For more project details, including the project timeline, financing, route and possible extensions, see our extensive past coverage.
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