Bay Staters Balk at High Cost of Boston Harbor Cleanup

THE question of who will pay for the Boston Harbor cleanup continues to vex Bay State lawmakers despite promised increases in both federal and state funding for the $6 billion project.

After intense lobbying by the Massachusetts congressional delegation, Clinton budget director Leon Panetta last week announced a one-time federal grant of $100 million. At the same time, Massachusetts Gov. William Weld (R) said he will offer either a tax deduction, tax credit, or direct-grant program to ease residents' high water and sewer bills.

But Bay State community leaders say the new federal funds won't offset increasing rates. "It is clearly not enough," says Vivien Li, executive director of the Boston Harbor Association. "One hundred million dollars is less than 8 percent of the entire cost of the cleanup."

The harbor cleanup project, which involves revamping the region's aging water and sewer system, has received limited federal and state funding since it began in 1989. Besides the $100 million just committed by Clinton administration, the project has been authorized to receive approximately $359,000 million from the federal government. The state has contributed only $53 million thus far.

As a result, residents of the 43 Boston area communities served by the project are paying the highest water and sewage rates in the country.

"Ninety-two percent of the cost of cleanup will be borne by the ratepayers and I think all of us in the area expect to pay our share," says Ms. Li. "But we expect the share that's being asked of us right now is much too much."

Environmental Protection Agency officials and Bay State lawmakers say the state should contribute more to the project. State Sen. Robert Havern (D) introduced a bill that calls for the state to pay $180 million over the next three years. He expects the bill to reach the governor's desk by the end of April.

State funding is vital since it is used directly to retire bonds used for the project and would immediately ease the burden on ratepayers, he says. Federal funds, on the other hand, are not applied immediately to debt service.

Thus, for every $20 million committed by the state, a ratepayer will receive a $24 reduction while $100 million in federal money will reduce it by only $11, says Senator Havern. "You can see this is much more advantageous to the ratepayers," he says.

Clinton administration officials, for their part, are now looking into a new clean-water financing proposal put forth by Rep. Gerry Studds (D) of Massachusetts. As an amendment to the Clean Water Act, the proposal would impose fees and taxes on industrial polluters. Money from the fees would go to ratepayers in municipalities around the country who are burdened by extra costs due to clean water regulations.

The amendment would include a tax on toxic pollution, fees on commercial water use, and a small excise tax on manufacturers of active ingredients in fertilizers and pesticides.