Five years ago, we inherited a sewer system that needed urgent attention. The Sierra Club and others had sued the city over sewage spills and permit violations, permits for two of our largest treatment plants were up for renewal, and there was a very real possibility of additional enforcement actions and substantial penalties. We immediately devoted necessary resources and rebuilt credibility with our regulators to solve one of the city's most complex, challenging, and costly problems.

In my first State of the City address, I told you frankly about the vulnerabilities of our wastewater system and pledged to make it a top priority. I also announced that I would propose sewer fee increases to pay for the needed work, and promised that the money would not be used for anything else. I flew to San Francisco one month later to meet with Environmental Protection Agency officials and personally affirm my commitment to putting the city's wastewater program in order and to lay the foundation for a relationship of trust and collaboration. Every single day since then, my administration has honored its commitments.

With the City Council's support, we have doubled, in some years nearly tripled, the appropriations for wastewater projects. To pay for this work, we implemented a second schedule of sewer fee increases. And even in these most trying of financial circumstances, the sewer fund has not been touched for any other purpose. As a result, we have brought sewage spills down by more than 60 percent compared to 10 years ago — and spills are now at an all time low. These results have been noted by Sen. Daniel K. Inouye, who has been very supportive of our efforts and our prioritization of collection system work over costly treatment upgrades that are being imposed, despite a lack of evidence that current treatment levels are harming the environment.

Meanwhile, with the assistance of the federal court, we have also made every effort to see if we could reach agreement with the EPA, the state, and the Sierra Club on a comprehensive program for our wastewater system. I dedicated 10 of the city's most experienced wastewater engineers to these discussions, without agenda or pre-drawn conclusions, but with three fundamental principles. First, anything the city agreed to must be technically justified; every dollar we agreed to spend had to have a corresponding benefit to the environment or public health. Second, our commitments had to be fiscally responsible; we had to know that they could be met within the city's financial constraints and at a cost that our ratepayers could bear. Third, any settlement would have to resolve all outstanding lawsuits and compliance issues; we cannot commit ratepayers to an enormously costly system, knowing that the "other shoe" is just waiting to drop. Throughout the discussions, the city did not reject anything that met these criteria.

Our engineers and lawyers have worked tirelessly for years, poring over data, analyzing options, and providing all parties with information and proposals. They also brought into the discussions some of the foremost experts in the field, to ensure all parties had the benefit of broad experience and expertise. However, no matter how much data, transparency, explanation, or expertise we have provided, no matter how much we have invested or turned our program around, nothing seems to overcome the other parties' rigid positions that are unrealistic and divorced from technical and financial realities.

If this continues, we will soon become embroiled in litigation of a magnitude rarely seen by any city. It will be a senseless, wasteful fight that defies common sense and drains money and other resources from further improvements to our system. And for what purpose? The simple truth is that we cannot spend more than our ratepayers can bear, and we cannot be held to deadlines that are technically and logistically unachievable. There is nothing more to be extracted from us in litigation that we were not willing to offer in negotiation. We have stepped up on every front and proven our commitment to doing the right thing, and it disappoints me deeply that the EPA cannot recognize how great an opportunity we have to reach together a long-term, sustainable solution to our wastewater issues in total.

The system still needs our attention, but no one wants litigation that distracts our engineers from their work, and detracts from all of the substantive progress we have made. In the face of unreasonable demands that are not proportionate to risk of environmental harm, there is a need to stand firm, in order to protect the ratepayers. I would never risk the environmental health of our beautiful city, and I also must be fiscally accountable, especially in these trying times. If EPA, the state, and the Sierra Club embrace this, we will reach resolution. Resolution or not, though, I will continue to honor my commitment to improve our wastewater system, and I thank the City Council and all of the hardworking city employees who have helped to make that improvement a reality.