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Peduto taps 'blue-ribbon' panel to restructure troubled PWSA

| Friday, March 10, 2017, 3:15 p.m.
Nate Smallwood | Tribune-Review
Bernard R. Lindstrom, the director of the Pittsburgh Water and Sewer Authority, speaks to the press regarding the boil order at the Allegheny County Emergency Operations Center on Wednesday, Feb. 1, 2017.
Andrew Russell | Tribune-Review
Workers from the Pittsburgh Water and Sewer Authority work to repair a 12-inch water main on the 1300 block of Pennsylvania in Manchester. (Andrew Russell | Tribune-Review)

Pittsburgh Mayor Bill Peduto has tapped seven influential government, nonprofit, academic and business executives to guide the first phase of restructuring the debt- and controversy-laden Pittsburgh Water and Sewer Authority, officials announced Friday.

The planned overhaul comes amid mounting uncertainty over the future of the authority and its ability to operate effectively.

PWSA Interim Executive Director Bernard L. Lindstrom's six-month agreement to work as an independent contractor expires on Sunday, and no one, as of late Friday, is set to replace him.

The authority's board is in talks with Lindstrom about renewing his contract, Peduto spokeswoman Katie O'Malley said.

Kevin Acklin, chief of staff to Peduto, said that Peduto would like Lindstrom to stay.

“We appreciate the leadership of interim Executive Director Lindstrom,” Acklin told the Trib, “and have invited him to extend his engagement with PWSA to help oversee the reorganization.”

Lindstrom did not return a request for comment. Neither did several PWSA board members.

The authority is going on more than a year without a permanent leader.

When Lindstrom was hired in September, PWSA board Chair Alex Thomson told the Trib the board intended to do a “robust and full search” to hire a permanent director by April.

When asked about the delay, Acklin emphasized that city officials are focusing on a long-term restructuring plan.

Acklin will be on Peduto's new “blue ribbon panel,” which is charged with making progress “toward improving and optimizing the publicly owned water and sewer asset.”

Specifically, the eight-member panel will evaluate submissions from legal and technical firms seeking to devise long-term strategies to improve PWSA's operations, customer service and value.

The city in January issued a request seeking proposals from professional service firms. The city received 18 submissions by the Feb. 24 deadline, O'Malley said.

The panel will narrow the field to four and interview the finalists.

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Panel members include: Kenya Boswell, president of BNY Mellon Foundation of Southwestern Pennsylvania; Fred Brown, president/CEO of Homewood Children's Village; Jared Cohon, director of Scott Institute for Energy Innovation and former president of Carnegie Mellon University; Jen Presutti, director of the city's Office of Management and Budget; Lourdes Sanchez Ridge, the city's solicitor and chief legal officer; Sharene Shealey, environmental manager for NRG Energy; and Mark Stulga, vice president of WesBanco.

The panel met for an hour Friday in the mayor's office, Acklin said. He did not elaborate on the discussion.

Under the existing model, the city's drinking water and storm systems are owned by the city and leased to PWSA, an independent authority with mayoral-appointed board members. PWSA has the option to buy the assets from the city for $1 in 2025.

Peduto has said he does not want to privatize the system completely. He called for a “full financial and operations partner” willing to pump money into improving the city's water infrastructure without outright owning it .

The authority's debt service tops $750 million, with 50 cents of every ratepayer dollar going toward paying down debt.

The mayor wants to find ways to grow revenue by expanding PWSA's drinking water delivery to more customers outside city limits.

In the past year, PWSA has grappled with multiple public relations crises, from overbilling customers to chlorine treatment deficiencies that spurred a flush and boil order affecting one-third of the city last month.

At the Feb. 2 news conference held to declare the boil order had been lifted, Lindstrom said the authority was at an “all-time low” in terms of not only staff and customer morale but also capabilities.

Lindstrom, a 28-year Army Corps of Engineers veteran from Upper St. Clair, assumed the temporary post overseeing PWSA on Sept. 12.

His independent contractor agreement approved unanimously by PWSA's board of directors included a salary of $16,667 per month, for a total of $100,000 over six months.

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