CHICAGO -- The Milwaukee Common Council approved a fiscal 1995 budget of just over $1 billion on Thursday that includes $89 million of bonding authority for water system improvements related to a 1993 cryptosporidium outbreak that afflicted thousands of people.
The council also approved other bonding proposals totaling $261 million for fiscal 1995, which begins Jan. 1.
The water system improvements call for relocating a water intake pipe from Lake Michigan at one plant, and improving filtration and using an ozone disinfectant process at the city's two water plants.
Stephen Agostini, Milwaukee's director of budget and management, said the council approved the ozone expenditure in a 14-1o-3 vote although there was some discussion among council members that the process, which will cost $51 million, would produce too small an improvement to be worthwhile.
Agostini said no determination has been made as to when the bonds will be sold next year or how much will be sold. He said the debt may be issued as revenue bonds or may carry the city's general obligation pledge.
The council on Thursday also approved an increase in water rates that is expected to average $17 per year per household.
In April 1993, Milwaukee's water supply became contaminated by a protozoan called cryptosporidium that resuited-in flu-like illnesses for thousands of people and a seven-day water boil order.
According to city bond disclosure documents, an estimated 340,000 people exhibited the symptoms, although few were tested for the presence of cryptosporidium. More than 50 deaths of people with impaired immune systems or with terminal illnesses may have been related to the water contamination.
So far, the city has been hit with about 1,400 claims, including 11 death claims. In addition, the city is defending itself against two class-action suits and five individual suits, according to the bond documents.
The city's liability would be limited under Wisconsin law to no more than $50,000 per person, according to the documents.
Improvements to the water system are the single largest capital project in the budget that Mayor John Norquist proposed in September for the 1995 fiscal year.
The council also approved $12.5 million of GO bonds for maintenance and classroom space projects for the Milwaukee Public Schools.
Other bonding proposals approved by the council included $36.3 million of GO bonds for general capital projects and $155 million of revenue anticipation notes for the city and its school system, according to Dorinda Floyd, a budget management specialist for the city.
The council also approved $25 million of GO bonding authority for "unforeseen" needs, in addition to $4.8 million of special assessment GO bonds, $12.4 million of tax increment financing GO bonds, and $15 million of delinquent tax GO bonds, Floyd said.
She noted that the city does not necessary use all of its bonding authority in a given year and often carries it over to future years. However, there is a three-year limitation on bonding authority, she said.
Norquist has seven working days from the date of council passage of the budget to accept or veto the budget. His aides said vetoes are not expected.
