Category Archives: Water.&.Sewer

Atlantic City Water Services to Remain in Public Hands

Source: Jocelyn Alcox, AFSCME Now, January 9, 2018
 
Members of AFSCME New Jersey worked hard to make sure Atlantic City’s water system remains in public hands. Just before the Christmas holiday, the state announced that it will not lease or sell the city’s water system to a private company. This followed more than a year of concern from residents and activists about the fate of the Municipal Utilities Authority (MUA), and is due in large part to the hard work and dedication of AFSCME members in and around Atlantic City. “We immediately knew we had to do something,” said April Gould, president of Local 3408. “Atlantic City is already struggling and outsourcing the water would have been disastrous.  AFSCME members have always been on the front lines of community issues and this time was no different. This is the community that we live in and that we work in, you can’t just leave those problems up to somebody else and hope they work out.” …

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State says it won’t sell or lease Atlantic City MUA to private company
Source: Erin Serpico, Press of Atlantic City, December 20, 2017
 
Following more than a year of concern from city residents and local activists about the fate of the city Municipal Utilities Authority, the state announced it will not lease or sell the water system to a private company. … The state has previously urged the city to dissolve the MUA, but the city either pulled or voted down measures to do so before the state took over in November 2016. For months after, more than 100 people from civic associations, the local chapter of the NAACP, Food and Water Watch and a group called “AC Citizens Against the State Takeover” knocked on doors and collected signatures to protect the water system from being sold. …

Atlantic City Votes To Protect Its Water From Chris Christie
Source: Daniel Cohen, Alternet, July 14, 2017
 
On Tuesday, the Atlantic City Council unanimously passed an ordinance to ensure its residents get to vote on any action by the state to sell or lease the city’s water system.  Why might New Jersey sell or lease Atlantic City’s water? Well, because Christie has been laying the groundwork for such a deal for years. In 2014, he passed a statewide law making it easier for struggling municipalities to sell off water infrastructure. Turns out, Atlantic City has been struggling—mainly due to a rash of casino closures, including Trump’s failed Taj Mahal. Last summer, after the state bailed the city out, Christie made it loud and clear there were strings attached: “I want [the loan] secured by every asset they have, so that if they don’t pay it, I get to take the assets, sell them and pay you [the taxpayer] back.” Late last year, he delivered on that promise and took control of the city’s assets and most of its decision-making power. …

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Peorians Deserve Their Water Back

Source: Jenya Polozova, Food & Water Watch, December 14, 2017

Illinois American Water is running a complicated show in the City of Peoria. They control the water system and they’re charging residents twice as much as what customers of neighboring public systems pay and the U.S. average. Water privatization in Peoria mirrors issues that towns all across the country run into when they sell a public resource to a privately owned corporation. Each time it means: losing transparency, accountability, management, and reliability. In sum, local residents have little say over the operations of the water system. … With the deadline of fall 2018 fast approaching, it’s finally time for Peorians to take their water back – but the water company is not going to go come to the negotiation table without a fight. …

… Years of propaganda and messaging campaigns create doubt that a City has the ability to provide services. But, when it comes to water systems, public provision is the American way.
… This trend to public ownership continues today. In June, Missoula, Montana, bought its water system from a provide company to provide long-term stability and better water resource management, as well as to make necessary improvements. The system was losing more than half of its water through leaks. The city plans $30 million in investments over the next 5 years — all without raising water rates. As the mayor said: “The city of Missoula is in this business for only one reason and that’s to serve customers. Water is it.” While it is understandable that the local union in Peoria fears that jobs may be jeopardized if the city takes over the water company, the City Council can and should include recognizing the local labor union and keeping the existing workforce as part of the municipalization effort. Not a single union worker should be dropped. Furthermore, cities that take back their water systems experience incredible economic benefits as a direct result. Take the city of Evansville, Indiana, where remunicipalization from IAW was expected to save the city $14 million over a short period of five years. Or even the city of Cave Creek, Arizona, where the city took back their water from American Water and saved an astonishing $1,335,017. …

Video: Deal of the Year 2017 – Small Issuer: City of Missoula, Mont.

Source: Bond Buyer, December 6, 2017

The city of Missoula, Montana waged a six-year legal battle to wrest control of its water system from a private company. The water system in the town of 70,000 was privately-owned by Mountain Water – a company that refused to make needed repairs to the system or sell it to the city. … Obtaining traditional financing with no disclosure from Mountain Water — and water assets nearly beyond repair — was unattainable given the risks. The city also had to provide payment before the court could rule it owned the water system. The solution: the direct sale to Barclays of nearly $140 million in A-rated bond anticipation notes. The financing plan uniquely provided the necessary mechanics to allow the city to purchase the water system. Prior to the acquisition, water bills were 17% higher than elsewhere in the state, but dropped to 49% below average after the deal.

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City Of Missoula Takes Ownership Of Mountain Water Company
Source: Beau Baker, MTPR, June 22, 2017

The city of Missoula has taken ownership of the water utility that serves its residents after a three-year court battle. The city bought Mountain Water Company for $84 million and paid another $6.8 million to developers who had a claim against the company. A separate bundle of transition costs, the bulk of which are attorneys’ fees, amounts to $7.5 million.
Mayor John Engen said city attorneys originally estimated the legal costs would be $400,000. Missoula won the right to buy the utility in an eminent domain case. It now joins all 128 cities and towns in Montana in controlling and owning its own water and distribution system. … Merriam says there are no immediate plans to change the rates. …

One for the history books: Missoula will buy its water system
Source: Sherry Devlin, Missoula Current, February 22, 2017

In an historic vote Monday night, the Missoula City Council unanimously approved the purchase of Mountain Water Co., forever ensuring the city’s “access to clean, affordable and reliable water.” … Throughout the recent effort, and decades of unsuccessful attempts by previous mayors and councils, the goal has been to place Missoula’s drinking water system into public ownership. … That now could happen by the end of March. With Monday’s vote, the local water system will be free from an increasingly distant and disaffected roster of corporate owners, most recently The Carlyle Group, a global investment fund, and the Canadian utility Algonquin Liberty. … Missoula’s water has always been in private ownership; all other Montana cities own their water system. … In fact, Bender said, Mountain Water Co.’s purchase by an international hedge fund – The Carlyle Group – imperiled every future generation.
The city’s purchase of its drinking water system will benefit those future generations the most, Bender said. …

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JEA Privatization Uniquely More Complicated Than Other Efforts Around The State

Source: Ryan Benk, WJCT, December 6, 2017

Following a regular board meeting that saw departing member Tom Petway charge his soon-to-be former colleagues with exploring privatization, JEA’s board chair is calling for a swift examination of the utility’s assets. … Should the board and Jacksonville’s political leaders decide privatization is the right path, JEA would not be the first municipal utility to do so in Florida. In fact, there are even examples of voters deciding to go the opposite direction: From private to public. Still, according to one expert, the massive tentacles of JEA’s electric grid, water service and sewer system — which serve more than 450,000 electric, 337,000 water and 261,000 sewer customers in Northeast Florida — would represent one of the largest and most complicated such conversions in Florida’s history. … After a lengthy 2012 exploration of JEA’s assets and the logistics of the city splitting with the utility, the decision was ultimately made to shelve the privatization idea. The last time an audit of JEA’s value was conducted in 2007, it was pinpointed at $2 billion as a municipal utility and more than $3 billion if it went private.

… Most recently, Winter Park successfully booted Progress Energy (now Duke Energy) and municipalized. Meanwhile voters in South Daytona Beach rejected a similar effort to turn their utility public. Kurry said data on customer satisfaction is mixed. Winter Park voters are generally happier with their choice and so are those in South Daytona Beach. … Just as murky as ratepayer views on service quality, customer perception of pricing fairness is mixed across the sector. …

Pittsburgh’s Water System Is Why We Shouldn’t Run America Like a Business

Source: Jordana Rosenfeld, The Nation, November 30, 2017

Pittsburgh, in an attempt to deal with entrenched infrastructure problems, turned to the private sector in 2012 when it partnered with the French management firm Veolia North America, the same water-management company that would fail to disclose Flint’s lead-contamination problem in 2015. … The organization lauded Veolia for identifying $2.3 million in new PWSA revenue and $3 million more in operating savings, a move incentivized by their contract that stipulated the company could keep 40 percent of every dollar it saved the city. The Pittsburgh Post-Gazette published a glowing account of PWSA’s partnership with Veolia, despite reports that it laid off 23 employees, many of whom were longtime employees with critical institutional knowledge. … But this August, a consulting group hired to assess the organization’s current state announced in a public meeting that PWSA was “a failed organization atop a dangerous and crumbling structure” with “an aging system in demonstrably worse condition than any water utility of its size in the country.” Not only that, water tests showed that since the partnership began, Pittsburgh’s water had been tainted with dangerously high levels of lead. …

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Veolia’s US growth hopes run into trouble
Source: Luc Olinga, AFP, September 23, 2017

Veolia’s hopes of taking advantage of municipal privatizations and promised Trump administration public works projects to expand its US presence, are being strained by its role in water crises in Flint, Michigan and other cities. … A push by more US local governments to privatize water systems and promises by President Donald Trump of a $1 trillion public infrastructure investment are seen as opportunities to Veolia to expand. … But Veolia’s operations have not been without controversy, especially in Flint, where a lead contaminated water system became a notorious symbol of American social injustice. Veolia issued a study of the city’s water quality before the scandal erupted but did not flag any issues with lead, an issue it says it was told to exclude from the report since city and federal authorities already were looking into it. … Veolia continues to face numerous investigations and class-action lawsuits connected to the crisis. … Veolia also has run into controversy in Pittsburgh, Pennsylvania, which also suffered from elevated levels of lead in its water system. The Pittsburgh Water and Sewer Authority has accused the French company of mismanaging the infrastructure system, including botching a shift in chemicals used in corrosion control. The Pittsburgh authority is in mediation with Veolia, according to two people familiar with the matter, but if that process fails it could result in another protracted court battle. …

Pittsburgh Tries to Avoid Becoming the Next Flint
Source: Kris Maher, Wall Street Journal, April 30, 2017

As its soot-filled skies cleared, this city built on the steel industry gained a reputation as one of the nation’s most livable places. But it now has another environmental issue to contend with: It is one of several major American cities with lead levels in drinking water above the federal limit.  A total of seven U.S. water systems, which each serve more than 100,000 people, had lead concentrations above the federal action level of 15 parts per billion in recent months, according to Environmental Protection Agency data. They include Portland, Ore., and Providence, R.I., which both exceeded the limit at least one other time in the past five years.  Since the lead crisis in Flint, Mich., cities have been under greater scrutiny from regulators and pressure from residents to reduce lead in drinking water. In most cases, there is no easy fix, and more cities are looking at the costly prospect of replacing vast networks of pipes buried under streets and private property. …

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The water systems in these 3 towns are broken. Now corporations stand to make millions

Source: Michael Sol Warren, NJ.com, November 5, 2017

… After decades of neglecting their water and sewer systems, three New Jersey towns now find themselves in similarly unenviable positions: On Election Day, voters in High Bridge, Long Hill and West Milford will choose whether to sell the systems to private corporations and give up local control — or to borrow large amounts of money to make the repairs themselves. And no one seems especially happy with either choice. … The three largest of the companies in New Jersey — New Jersey American Water, Suez Water New Jersey and Aqua New Jersey — are all subsidiaries of larger publicly traded corporations; American Water Works, the parent company of New Jersey American Water, is worth more than $13 billion. But privatization is especially widespread here. According to a Washington Post article published last December, 43 percent of New Jersey water is privatized, the third most in the nation.

… Yet not everyone thinks water privatization is such a great idea — and some say that a recently passed law, the Water Quality Accountability Act, is only compelling more municipalities to go private. The law demands that water systems around the state be updated. But the cost of those updates is often too much for smaller municipalities to bear. … Smith and other opponents of privatization point to broken promises by the companies and argue selling a system is a short term fix that could lead to bigger problems in the long run. For one thing, that rate stability that the companies tout doesn’t always pan out. … Another wrinkle to privatization plans: Many municipalities end up with a lot less money than their water systems are actually worth. … And whereas public utilities are accountable to the taxpayers, private corporations are accountable to their shareholders — which leads to situations like the one in Camden, which contracted its water and sewer systems to Suez in 1999. … The heated arguments in High Bridge last week centered around the questions of whether local residents have been given the full picture of the issue as they head into polling stations on Election Day. Jane Karp and other opponents of privatization are angry that High Bridge borough councillors requested bids without first finding out how much their water system is worth. …

New Orleans’ summer of floods revives the threat of privatization

Source: Aviva Shen, ThinkProgress, October 20, 2017
 
This year’s spate of floods prompted sudden scrutiny of the city’s long-neglected infrastructure, but everyone knows the system is not fully prepared to manage the city’s regular downpours. … After the August flooding, the Sewerage and Water Board admitted that at least 14 of the pumps that constantly churn water out of the ground had been offline. Outrage erupted. Several board officials resigned in political sacrifice, and Mayor Mitch Landrieu (D) called for a private company to intervene and potentially take over the agency. … Private firms Veolia and CH2M quickly snapped up no-bid contracts to analyze New Orleans’ systemic failures after the August flood, stoking suspicion that the mayor would quietly transfer power over the water systems to for-profit companies. CH2M and its subcontractors have been tasked with servicing turbines that power the city’s pumps and finding back-up power sources. Veolia, which already manages part of the city’s wastewater system and its entire mass transit system, has been authorized not only to analyze the failings of the stormwater system but to “start taking the right steps to any necessary maintenance efforts.” The cost of fulfilling these contracts is still unclear…..

Taking the P3 Route to Reinvent Downtown

Source: Charles Renner, Public Management, July 27, 2017

… The past decade has seen a steady increase in the use of P3 structures, and 2016 was something of a watershed year with multiple high-profile projects coming online that address a variety of public needs, including a $1 billion water infrastructure project servicing San Antonio, Texas, the site of ICMA’s 2017 Annual Conference. In each case, the public sector identified a future need aimed at supporting the attraction of mobile talent, evaluated the limits of going it alone, engaged a P3 partner, and found leadership to achieve results. …

A Sioux Falls Renaissance … A key part of the updated Downtown 2025 Plan is increasing the CBD’s available commercial and residential real estate. To help accomplish this, Sioux Falls opted for a P3 solution to design, build, operate, and maintain a mixed-use facility with retail, office, and residential uses that will ultimately increase the density of downtown. …

Nebraska Innovation Campus and P3 … Located adjacent to the University of Nebraska-Lincoln, NIC is a research campus designed to facilitate new partnerships between the university community and private businesses. …

San Antonio’s Vista Ridge … As a result, the San Antonio Water System (SAWS) crafted the vision of a 142-mile water pipeline project called Vista Ridge that will deliver enough water for some 162,000 new families by 2020, providing a 20 percent increase in water supply. … SAWS opted for a P3 undertaking in order to engage private equity and much needed development expertise in securing and constructing a resource delivery project that requires roughly $1 billion in investment, thousands of private water commitments, along with the 142 miles of built-to-last water pipeline. …

Pennsylvania municipalities and utilities benefit from privatization, says Moody’s

Source: Paul Burton, Bond Buyer, August 15, 2017 (subscription required)
 
Pennsylvania municipalities and regulated investor-owned utilities will benefit from legislation removing hurdles for local governments to sell water and wastewater systems, Moody’s Investors Service said.  Moody’s in a report Tuesday projected more privatizations. Municipalities within the commonwealth Pennsylvania see utility sales as a way to cope with financial distress and sidestep maintenance and compliance costs.  The report examined the $195 million sale of the Scranton wastewater system and the pending $162 million sale of the McKeesport wastewater system outside Pittsburgh to the Pennsylvania-American Water Company. Regulators must still approve the latter. …

Is Privatization on Its Way Out?

Source: Donald Cohen, HuffPost, July 27, 2017

According to a new report by the Transnational Institute, cities across Europe are increasingly deciding to reclaim public goods like water, energy, and health care from corporations and private investors. For example, fourteen cities in the Catalonia region of Spain have brought their water under public control in the past two years alone. … As always, the movement is starting at the bottom.  There’s Milford, Connecticut, a small city pushing to purchase its water system after learning that the corporation that owns it plans to raise rates by nearly 30 percent.  There’s New York, which just brought back state workers to provide IT help desk services after concerns about rising costs in a contract with IBM.  There’s Atlantic City, New Jersey, which earlier this month passed an ordinance to ensure residents get to vote on any action by the state to sell or lease the city’s water system.  There’s Baltimore, Maryland, where teachers just recruited hundreds of new public school students after weeks of knocking on doors. And Miami, Florida, where parents and teachers rallied over the weekend to demand more funding for public education and regulation of charter schools.

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