Thursday, April 2, 2009

Atlanta Dept. of Watershed Management Response to H.B. 406

On Tuesday the Senate Rules Committee passed onto the floor a special interest bill that works against the common interests of all Georgians. It undermines investment in drinking water projects, including new reservoirs. It does this by jeopardizing infrastructure revenue bonds for the entire state of Georgia.

"House Bill 406 turns upside down the progress Georgia has made in water resource planning. It allows special interest projects to bypass the tried and true processes for project permitting and service delivery," says DWM Commissioner Robert Hunter.

H.B. 406 is designed to allow a local pump-storage reservoir in South Fulton County to avoid state requirements that have been in place for decades. The reservoir would constitute a new water withdrawal from the Chattahoochee River. One consequence of the statewide legislation would be to fundamentally change the process to decide which utility provides services within any given area. This change would make Georgia law and regulation significantly different from that of other States and would also significantly increase the risk to Georgia revenue bonds. Published reports by bond rating agencies verify that the stability of service areas is an important rating factor for revenue bonds.

"The national bond market is very unstable at the moment and even more so in Georgia where we have seen water system revenues drop by as much as 20 percent due to the drought. This is absolutely the wrong time to increase the risk to our infrastructure bonds by increasing the uncertainty of service areas and the revenues needed to pay the bond debt," says Hunter.
H.B. 406 will not increase investment in drinking water infrastructure or reservoir development. "It will, in fact, harm future reservoir development," says Hunter.
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