A three-city venture for wastewater utility services.

• Author: Hill, Catherine A.
• Position: Ohio cities acquire Miami Conservancy District's North Regional wastewater treatment plant in the state

Editor's note: An article in the February 1996 issue of Government Finance Review detailed the privatization of a Miami Conservancy District (MCD) wastewater treatment facility in Franklin, Ohio. This article examines an alternative to privatization for another MCD facility; rather than selling the facility to a private firm, MCD transferred ownership to three cities. The three city managers involved were awarded the Ohio Government Finance Officers Association's 1996 Innovation in Public Finance Award.

When the Miami Conservancy District in Ohio decided to divest ownership of its North Regional wastewater treatment plant in 1991, the three affected cities proposed an innovative approach to ensuring reliable, reasonably priced, and environmentally sound treatment services for their citizens. Forming a partnership authorized by state law, the cities assumed joint ownership of the treatment plant.

A Transfer of Ownership

In 1991, MCD announced its plans to divest ownership of its wastewater treatment facilities so that it could focus on its primary mission of flood control. MCD's North Regional plant in Dayton, Ohio, had served the residents of Huber Heights (population 40,000), Vandalia (population 13,500), and Tipp City (population 7,500), as well as portions of Montgomery and Miami counties, since 1985. Previously, each city had its own wastewater treatment facility. When they were unable to finance upgrades required by secondary treatment standards, the cities asked MCD to construct a plant to serve the entire region. The North Regional facility was financed mostly by a grant from the U.S. Environmental Protection Agency, while the remaining funds were borrowed from the Ohio Water Development Authority. Once the 11.2 million gallon per day regional plant was completed, the Huber Heights and Tipp City plants were partially demolished, and the Vandalia sewage treatment plant was purchased and retrofitted to become a liquid sludge storage facility, an integral part of the regional plant.

Contemplating the divestiture of the North Regional facility, MCD engaged a private engineering firm to conduct an analysis to determine the best course of action. The firm suggested three options; the plant could be transferred to

* an existing public entity,

* a private company, or

* a regional sewer or sanitary district.

When MCD presented these options to Huber Heights, Vandalia, and Tipp City, extensive discussions led to a fourth option: the cities...