The Metropolitan District Commission was in the news again this week. Well, that makes it sound like they’re in the news a lot, and they’re not. One of the several things that the MDC does well is keep a surprisingly low profile, given it’s wealth and power. This week, after outlasting public opposition over the past few years, the MDC granted a 50% discount to any customer consuming more than 600,000 gallons of water per year. Only the MDC’s largest customer, the Niagara Bottling Company, meets that minimum. Niagara is a closely held California business that sells private label bottled water to stores like Walmart and Costco.
Plenty of people in the area wonder why our water company would be selling our water at a big discount to a for-profit company that sells the water elsewhere. “Our water”? Sure, it’s our water. The MDC is a political subdivision of the state whose mission, according to its website, is “to provide our customers with safe, pure drinking water, environmentally protective wastewater collection and treatment and other services that benefit the member towns.” (emphasis added) This deal is supposed to benefit us. The MDC says it does benefit us, because the MDC needs more revenue to cover its cost of operations, and granting the discount will increase water sales and therefore increase revenue.
Residents of the area have plenty of questions, because on its face it would seem that selling water for use outside our area isn’t in our best interests. I could ask a lot of questions myself, but I’m ignorant about MDC operations. I’d say the chances are pretty good that, all things considered, the MDC is doing the right thing. I’m willing to give the MDC the benefit of the doubt – it’s their business to run, and they seem to have done it pretty well over the years.
The current news about the MDC did, however, bring me around again to why shared services among our many towns is generally a bad idea. Recall (as if you could forget) that I believe Hartford and several surrounding towns should merge into one city. I believe that we can plan and build for the future only if we have one central government. One of the principal arguments people make against this suggestion is that the proposal is too radical, that we should start more slowly by having inter-town agreements to share one service or another. The MDC is a textbook example of what happens when towns share services.
Regardless of whether the water discount is a good thing for the community, the issue has shown once again that the MDC operates more or less without any public oversight or control. Here’s an organization run for the public benefit whose financial statements say it has a total “net position” (sort of like the equivalent of stockholders equity, I think) of over $800 million and has “excess of revenue over expenditures” (profit) in the $50-$70 million range, and yet it operates independently and is responsible, in practical terms, to no one.
The MDC’s independence from any reasonable public control results directly from the shared services model. When towns share services, each town wants to be represented on the governing board. In the case of the MDC, its board is governed by 31 Commissioners, 20 appointed by 11 towns, 7 appointed by the Governor and 4 by the General Assembly. It’s easy to see that the commission answers to no one. If the Governor doesn’t like how the MDC is running, the Governor can remove and replace only seven commissioners, not enough to change control of the commission. Hartford appoints 6 commissioners, so Hartford doesn’t control, either. Hartford and the Governor together probably could do it, but that’s going to happen only under extraordinary circumstances. In a structure like that, it’s very difficult politically to muster enough votes to change control. If no one controls the commission, then it runs itself.
What kind of governance does that structure generate? It generates exactly what we have in the MDC. A savvy political power broker, serving either as Chairman or Chief Executive Officer, takes control of the board and doesn’t let go. In this case it’s William DiBella, who has been a Commissioner for nearly 20 years and has had a significant hand in controlling the MDC for over 30 years. If you’re the sole commissioner appointed by a town, how hard are you going to fight to move Bill DiBella out of control of the commission? Not very hard, even under the best of circumstances. If commissioners receive some personal benefit for serving, such as retirement benefits (I can’t tell from the MDC’s website if they do), then they have even more reason not to rock the boat.
The MDC is not responsive to normal modern democratic political forces. How do I know that? Because Bill DiBella is entrenched at the Commission. How many mayors and how many city council people has Hartford had over the past 40 years? A lot, right? How many different people have been appointed to the Hartford Board of Education over that period? A lot. Has any person served on the BOE for more than 20 years? I couldn’t find the records, but I’m sure the answer to the last question is no. New mayors put their own people on the Board of Education, and no one serves for 20 years. So how does Bill DiBella keep getting appointed to the MDC board by multiple mayors and multiple city councils? I don’t know, but it’s a good bet that it isn’t pretty. When a previous Chair of the MDC proposed that towns elect their commissioners, the idea was quickly pushed aside as unworkable. Bill DiBella was having none of that.
By the way, if you think the MDC is just another public entity, go on their website and follow the links to their financial statements. Before you can get to their financial statements, you must agree to their terms. Among other things, you must agree not use their information for any public use without their permission. Does your town require your agreement to see the town’s financial statements?
I’ll say again that I don’t know that there’s anything wrong at the MDC. I’m not accusing anyone of anything. What I’m saying is simply that the MDC demonstrates how a shared service organization, an organization designed to serve multiple jurisdictions, takes on a life of its own over time. The MDC has become an independent power broker; its operations are not transparent, and it makes its own decisions, more or less free from public control.
The MDC isn’t the only example of this problem. The Capital Region Education Council also is a collaborative effort. CREC is a council created to meet educational needs of its member towns. It’s a classic shared service organization.
Why do we need CREC? Because 60 years ago Connecticut decided to get rid of county government and proceed into the future exclusively with town governments. It was such a bad idea that within a few years the General Assembly adopted a law permitting the creation of regional education service centers, of which CREC is one. Why did they need to create RESCs? Because the county governments that were ideally suited to dealing with such needs no longer existed, and most towns were unable to provide the necessary services cost effectively.
Unlike the MDC and to their credit, CREC lets us see their financial statements without agreeing to their terms. Like the MDC, it’s a big organization. It has a net position over $400 million and a profit last year of $17 million.
CREC is governed in some ways like the MDC. It has 35 council members, one from each town that belongs to CREC. In other words, the council doesn’t answer to a single authority of any kind, just like the MDC doesn’t. You can find the names of the 35 council members on their website – they all seem to be professional educators or members of town boards of education. Like any governing board that size, the council delegates the fundamental decisions to the Board of Directors, consisting of ten directors. The name of the Chair of the Board can be found on CREC’s website, but after a twenty-minute search I was unable to find the names of the other directors.
Think about the consequences of what I just said: CREC runs 17 schools in our area and five other special services schools – CREC is larger than every school district in our region except Hartford. No one on the Commission is elected by the general public, and even the identity of the members of the governing board is difficult to determine. That’s what we get with shared services.
Is there something wrong at CREC? Probably nothing. They seem to be doing just fine.
The problem with the MDC and CREC is that the model is wrong. Why? Because every time we create a shared service, our control of the service becomes more indirect, so indirect, in fact, that we have more or less no control. MDC and CREC have become independent political organizations that will protect their turf, just like towns, and they are and will continue to be impediments to centralized regional planning and development, just like individual towns are impediments.
We can’t make greater Hartford better by relinquishing control to multiple shared service organizations, each of which becomes a separate political entity. We need to consolidate control. Greater Hartford almost certainly never will retake control of its water supply from the MDC; that horse is so far out of the barn that we may as well forget about riding it. If we had merged Hartford and the surrounding towns fifty years ago, we never would have needed CREC. If we merged today, eventually we probably would retake control of CREC.
In any case, it’s obvious that creating more shared-service organizations is the wrong way to go. It’s like creating more towns when what we need is fewer towns.
If you’re driving to Boston on I-84 and you take the wrong fork (as I have done) at the I-90 junction, do you just keep driving to Springfield? If you’re like me, you mutter some expletive, drive to the next exit and turn around.
Connecticut chose the wrong path when we eliminated county government. We know that. People have been muttering about it for thirty years. It’s time to turn around.
This week’s homework: Review the proposed 15-year plan for the City of Hartford