Randy Leonard—down to his final year and half or so as a city commissioner—has faced a torrent of criticism in recent months over his handling of the water bureau, one of the major bureaus he still has left. An audit this year ripped into decisions to spend rate money on a bunch of "non-mission-critical" projects (a story nicely amplified in detail by the Oregonian this week). There's been an ongoing contretemps over covering and/or irradiating Portland's open-air reservoirs. And then there was the whole pee-pee in the reservoir thing, AIDS comments and all.

Today, the Tribune has reported, a group of city utility watchdogs gathered outside city hall to demand Mayor Sam Adam exercise his powers to reassign bureaus and give the water bureau to someone else.

The mayor, a longtime political ally whom Leonard has promised to endorse (if and) when he runs for re-election, has put up a statement telling the coalition folks, basically, to back off bashing Leonard—while also giving a nod to Commissioner Dan Saltzman's proposal (a plan also espoused by the mayor, before he was mayor) for an independent panel to monitor rates and spending.

The City Council has also been involved in other recent Water Bureau expenditures, including the renovation of the Rose Festival Building and the Water House. Those projects were approved by the entire council after extensive budget discussions.

Read the whole thing after the jump.

I am not considering a reassignment of the Water Bureau.

The real—and very serious—issue that our city’s Water Bureau is grappling with is a significant potential rate increase in the coming years, due to unnecessary, strict, and expensive federal regulations. This is an issue faced not only by the commissioner-in-charge of the Water Bureau, but the entire City Council and all water ratepayers. Under Commissioner Randy Leonard’s leadership, the City has explored multiple avenues for relief from these federal regulations, including challenging them in court. Commissioner Leonard and I have personally and directly lobbied for federal regulatory relief. I have encouraged critics of our efforts to provide detailed ideas on how to avoid these regulations, and I encourage them to continue to do so. For example, critics have asked us to apply for regulatory relief from the state and federal government on the requirement to cover the reservoirs. We pursued that request, and had official responses from state and federal government that regulatory relief is not available, and there is not a way to apply for an exception to the rule.

Unfortunately, the City lost our court challenge, and we have been told repeatedly that we must comply with these regulations, however expensive they may be. The City of Portland does not get to choose which federal laws we comply with. The consequences of not complying with these regulations are severe, and could include steep federal fines. These are the facts, and the facts are clear.

The City Council has also been involved in other recent Water Bureau expenditures, including the renovation of the Rose Festival Building and the Water House. Those projects were approved by the entire council after extensive budget discussions.

In the near term, our city must reexamine the process and policies around setting utility rates. I am a longtime proponent of an independent utility rate commission, in line with a proposal that Commissioner Dan Saltzman is currently working on. In the most recent budget cycle, I proposed lower utility rates that were requested by the bureaus. I was successful in securing council approval for a lower water bureau rate increase, but the council overturned my proposed reduction to the sewer rate increase. An independent utility rate commission would provide an invaluable perspective as the council makes these decisions.

An independent utility rate commission needs to be coupled with clear policies that would guide expenditures on things like charitable contributions—including assistance to low income and senior ratepayers, and community outreach projects—that other utilities routinely make. Together, an independent utility rate commission and expenditure policies will greatly assist the council in setting appropriate rates and budgets for our utility bureaus.

I look forward to working with all of my council colleagues as we navigate the federal regulations and how to best comply with them, and as we examine how we set our utility rates and how those dollars are spent.