$300 Billion War Beneath the Street: Fighting to Replace America’s Water Pipes

Source: Hiroko Tabuchi, New York Times, November 10, 2017
 
America is facing a crisis over its crumbling water infrastructure, and fixing it will be a monumental and expensive task.  Two powerful industries, plastic and iron, are locked in a lobbying war over the estimated $300 billion that local governments will spend on water and sewer pipes over the next decade. … To more directly reach towns and counties across the country, the plastics industry is also leaning on the American City County Exchange, a new group that gives corporations extraordinary capacity to influence public policy at the city and county levels. The group operates under the auspices of the American Legislative Exchange Council, a wider effort funded by the petrochemicals billionaires Charles G. and David H. Koch that has drawn scrutiny for helping corporations and local politicians write legislation behind closed doors. …

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Why Water Privatization Is a Bad Idea for People and the Planet
Source: Adam Hudson, AlterNet, April 18, 2017

… As climate change increases global temperatures and causes odd weather patterns, multiple cities across the United States are experimenting with some form of water privatization.   In February 2015, Chris Christie, the Republican governor of New Jersey, signed a law green-lighting the privatization of municipal water systems. The bill, called the Water Infrastructure Protection Act (WIPA), allows municipalities to sell their water systems to private companies without a public referendum. … Wisconsin is another front for the battle over water privatization. A bill proposed by a Republican state legislator, at the behest of Pennsylvania-based water utility company Aqua America, would make it easier for private companies to buy Wisconsin’s municipal water systems. …. The record of water privatization efforts is far from rosy. A report by the Pacific Institute, an environment, development and security research organization, points out numerous problems with water privatization. … A June 2016 report by Corporate Accountability International found that water privatization, in the form of public-private partnerships (PPPs), not only fails to solve the problem of fixing public water systems to ensure safe and clean drinking water but actually exacerbates it. …

You Had Me At H2O: A look at who owns your water supply
Source: Beryl Lipton, MuckRock, February 14, 2017

… According to one estimate, municipalities may be spending an estimated $500 billion in capital improvements over the next decade. But between private water companies looking to consolidate their regional reach and activists that insist the federal government should be spending more to help towns keep their water treatment local, there willl need to be a lot of room to talk about how we handle this most precious resource, which the UN has recognized as a basic human right. Action will be most important on the local level, and the people will have to speak up for themselves. We want to help by offering to file your water-related records request this week. …


America can’t trust public water, so it’s turning to private companies
Source: Renuka Rayasam, Quartz, October 25, 2016

While most Americans don’t have to think too hard about whether their water is safe to drink or not, people in Camden, New Jersey are used to not having clean water. When a water main breaks, which has happened at least twice this year, residents are advised to boil their water. When it rains hard in the city, sewage backs up (pdf) and floods the streets. And kids in school there drink from water coolers instead of water fountains, which were shut off in 2002 after officials found lead in the pipes of older schools. … It’s probably no coincidence that nearly 40% of the population lives under the poverty line. But soon it won’t just be poor cities like Flint, Michigan or Camden that have to worry about water. A perfect storm of aging infrastructure, stretched municipal budgets, and changing climate conditions are putting even more of the country’s water systems under pressure. Faced with the steep cost of fixing their broken and ill-prepared infrastructure, lawmakers on both sides of the aisle are turning to private money in their search for an answer to the country’s water woes. While the record of private companies handling water supplies has been mixed, this trend toward water privatization seems to be some kind of tacit acknowledgment that local governments can’t fix the problem on their own. …

… The ground for large-scale privatization is already being prepared. On the federal level, for example, President Obama signed the Water Resources Reform and Development Act in 2014, which has a provision that promotes private investment in water efforts, such as repairing water pipes, boosting water monitoring, and desalinating ocean water to make it safe to drink. In New Jersey, where lead has been found in at least 137 schools, Governor Chris Christie signed the Water Infrastructure Protection Act in February of 2015, which allows municipalities to contract out water services to for-profit companies without a citizen vote. For municipalities, bringing in private players is often the easiest and most politically expedient solution. …

… Those pushing for privatization believe that for-profit companies are more efficient at managing water systems and have the expertise to do so. But opponents believe that for-profit companies charge too much for water services in order to meet corporate bottom lines. Food and Water Watch, a consumer rights group, for example, reports that large, for-profit, privately-owned water systems charged households 59% more for water than large, publicly-owned systems. In reality, private companies are no better or worse at holding down costs than public entities, says Warner. She looked at published studies from 1965 to 2009 and found no difference in costs between privately-controlled and publicly-controlled systems. …

Privatizing Water Facilities Can Help Cash-Strapped Municipalities
Source: Adam Millsap, Forbes, October 5, 2016

After the Flint, MI water crisis earlier this year, some suggested that the city should privatize its municipal water service. This suggestion was met with criticism and arguments that privatization fails to improve quality or decrease costs. Others simply don’t like the idea of a private company having anything to do with the production of one of life’s necessities. But the private production of water and sewage services is often advantageous for consumers and taxpayers, and it’s more common than many people realize. … More generally, there is no compelling economic reason for local governments to be the sole producer of water. Harvard Economist Andrei Schleifer has written extensively on private vs. public ownership, and one of his key points is that public ownership may be preferable to private ownership when there are significant opportunities for deteriorations in quality that cannot be adequately avoided via contracting. … First, water quality is relatively easy to contract for; simply specify the allowable amount of the various contaminants. Water quality is also relatively easy to monitor, and compared to prisons there are more people interested and capable of monitoring it—consumers, government officials, media and watchdog groups. … Second, there is more oversight. The firm has an incentive to provide the specified water quality in order to maintain their business with the city and to avoid being sued for breach of contract. Local government officials can easily monitor the firm since they only need to focus on water quality and availability. If either the government or the firm fail to do their job, the other entity can alert residents. … City officials and residents need to remember that privatization itself is not a panacea. The key to effective privatization is maintaining competition. Private firms can quickly become inefficient and wasteful when sheltered from competitive market forces. That being said, in many cases water privatization can improve infrastructure, lower costs and provide residents with the clean, safe water they expect. …

As Water Infrastructure Crumbles, Many Cities Seek Private Help
Source: Governing, March 30, 2016

More than 2,000 municipalities have entered public-private partnerships for all or part of their water supply systems, according to the National Association of Water Companies, which represents private water companies like Veolia North America and American Water. Partner municipalities include San Antonio; Akron, Ohio; and Washington, D.C. Miami-Dade County is considering partnerships for three water facilities, including one built in 1924. And Wichita, Kansas, is starting to study the issue. … Maintaining, operating, replacing and upgrading the nation’s water infrastructure could cost $2.8 trillion to $4.8 trillion through 2028, according to the U.S. Conference of Mayors. The American Water Works Association estimates that replacing and expanding water pipes alone would cost $1 trillion through 2035. And the American Society of Civil Engineers gives U.S. water infrastructure a D grade. Greg DiLoreto, past president of the ASCE, estimates that systems nationwide would need $84 billion in improvements by 2020 to get to a B grade. …