City Commissioner Dan Saltzman, in charge of Portland's sewer and stormwater operations, has finally brought forward an idea he first floated this spring after a city audit blasted how his Bureau of Environmental Services, and especially Randy Leonard's Water Bureau, were spending ratepayer cash.

(Update 4 pm: This post has been revised to include comments from Saltzman.)

In short: Saltzman wants to create what would be known as Portland's Independent Utility Commission and put it in charge of the two bureaus' finances.

Five Portlanders would be tasked with devising budgets for the bureaus—along with the rates they ought to charge customers to pay for those spending plans—and then weigh in on how well bureau officials are hewing to what's been set out. The utility commissioners would serve at the behest of the city auditor, not the Portland City Council.

"I've been in this building for 13 years, but the past two ears have really, in my mind, created a bad perception of how the council is involving itself in setting rates, to the detriment of our reputation," Saltzman told me. "This was a way to crate a more impartial process."

The proposal, also coming at a time of tension over rapidly escalating rates (this here being one reason why), would cut the mayor and the commissioners in charge of the two bureaus out of process. It's a big change because it weakens, if slightly, one of the major perks of being Portland's mayor. Currently, the mayor sets budgets for the bureaus, and the commissioners come up with rate plans. The entire city council would retain, per state law, the right to approve whatever plans the commission devises.

Saltzman says his colleagues so far are "noncommittal, but open to," and even supportive of, the idea. Amy Ruiz, Mayor Sam Adams' spokeswoman, said her boss sat down with Saltzman to talk about the proposal this afternoon.

"I discussed the public draft with Commissioner Saltzman today. It's headed in the right direction," the mayor says. "I look forward to hearing public input on his proposal."

The oversight potential in Saltzman's plan is especially intriguing. Instead of pointed but sporadic efforts by the auditor's efforts to monitor expenses, the commission, under Saltzman's vision, would have a staff to help it regularly monitor, and crow over, questionable expenses.

The IUC will have the authority and dedicated professional staff available to review and make recommendations on the rates and budgets throughout the budget year. In addition, if the IUC finds a bureau has made an unauthorized expenditure, the IUC may, at its own choosing, exercise authority to review every subsequent expenditure of that bureau.

Saltzman, however, acknowledges that staffing the commission—including one or two economists and an administrative position—would come with a price tag. The bureaus would fund the commission, even though the auditor's office would manage it. Saltzman says the budget would be capped at one-tenth of one percent of the two bureaus' combined operating budgets. He puts the number this year, for example, at $476,000.

"I'm not sure it'll take that much," he says. "But that'll be the cap."

Saltzman isn't the first Portland politician to propose such an overhaul. In 2004, then-council candidate Adams was airing a very similar pitch for a commission, with his version larger and slightly more powerful.

In a 2004 position paper, Adams offered this:

City Water and Sewer Utilities: The rising costs of water/sewers rates are a growing source of concern to residents and businesses alike.

Because of the specialization of their services, their size and complexity, a single Commissioner-in-Charge and the five members of the City Council cannot adequately provide oversight to the City's $1.4 billion utility operations.

Much like the State Public Utility Commission, I propose appointing a seven-member City of Portland Utility Board (folks with expertise on utility and environmental issues) that would be empowered with some independent operational authority over the Water and Environmental Services bureaus, unless overruled by a vote of the Portland City Council.

I would ask the Portland Utility Board to embark on a comprehensive zero-based audit of costs, programs, and services and provide the City Council with recommendations to reduce or control cost increases.