This Is How the Trump Administration Will Privatize Our Infrastructure

Source: David Dayen, The Nation, June 20, 2017
North Miami Beach’s Norwood water treatment plant is a major source of revenue, serving a region with almost five times as many customers as city residents…. Critics, including plant employees and members of the local Public Utilities Commission, blamed the city for intentional lack of investment and reduced staffing. “It’s on the city workers somehow that the system has fallen into disrepair,” said a spokesman with AFSCME Florida. “If you’re a journalist, and the newspaper is not making money, is that on you?” … As for plant workers, they could lose benefits under CH2M immediately, since the city’s contract with AFSCME expired in 2015. The CH2M contract calls for $2.4 million in annual savings in labor costs starting in year two. And with a fixed fee for operations and maintenance, CH2M can only extract profits and deliver long-term cost savings by cutting corners. …


North Miami Beach Gives Public Water Utility Serving 180,000 People to Private Firm
Source: Jerry Ianelli, Miami New Times, May 17, 2017
None of those facts stopped the North Miami Beach City Commission last night from voting 4 to 2 to outsource its public water utility to global engineering firm CH2M Hill. From here on out, the company will control virtually every operational facet of a water plant that serves more than 180,000 people in North Miami Beach, Aventura, Sunny Isles Beach, and Miami Gardens. … On April 3, the city held a special meeting to begin formal negotiations with CH2M. In the leadup to that meeting, the city’s municipal worker’s union, the American Federation of State, County and Municipal Employees, spoke out against the privatization plan as an attempt at union-busting. The ASFCME warned that privatization deals tend to lead to job or benefits cuts to workers.  Though the final contract guarantees that all city workers who pass a drug test and physical must be rehired by CH2M, the contract does not say what will happen to those workers in the following years. (During that April 3 meeting, multiple city workers accused the government of willfully underfunding the plant to create an excuse to privatize it.) …

North Miami Beach to Vote on Privatizing Its Water System Tomorrow Despite FBI Probe
Source: Jerry Iannelli, Miami New Times, May 15, 2017
On April 3, the City of North Miami Beach started negotiating with a global engineering firm to take over the city’s water utility, which services close to 200,000 people in north Dade. Clean-water activists vehemently opposed the move, citing research that water utilities run by private companies tend to get much more expensive over time, and typically provide services at “cheaper” rates by cutting staff or services. … But those facts have not mattered at all to North Miami Beach’s elected officials. Tomorrow, the city commission will vote on whether to hand the utility’s operations over to CH2M Hill Engineering for an annual fee of $18.8 million per year. (The city would retain ownership of the utility, but CH2M would handle the plant’s day-to-day operations. The city will also pay CH2M $19.3 million in the first year to cover startup costs.) …

North Miami Beach Moves Forward With Water-Privatization Deal Despite FBI Probe
Source: Jerry Iannelli, Miami New Times, April 4, 2017

At the beginning of North Miami Beach’s meeting last night about a plan to privatize its water system, City Manager Ana Garcia asked residents to trust the city based on the commission’s track record. That was an odd appeal, considering Mayor George Vallejo is the subject of an ongoing Miami-Dade County criminal probe and the FBI and Miami-Dade County Public Corruption unit have launched investigations into the water negotiations. Despite all of those red flags, commissioners voted 4-2 last night to move forward with the plan after a testy meeting that lasted close to three hours. … The city also did not disclose that an affiliate of the leading company bidding for the project, global engineering firm CH2M Hill, has held a temporary contract to operate portions of the plant since October 17, 2016. The contract raises additional questions as to whether the city’s bidding process has been fair. … The vote authorizes the city to begin negotiating a contract with CH2M, which is angling to take over the full operation of the city’s water plant.

… Per the terms of the city’s request for quotation, the private company is expected to take over full plant operations and take over the contracts of every employee at the utility. The American Federation of State, County and Municipal Employees (AFSCME), a union that represents the utility workers, says roughly 80 employees could be affected. The union warned last week that privatization deals tend to lead to benefit cutbacks and employee layoffs as the new company tries to cut costs. AFSCME does not have an active contract with the city, and union representatives warned last week that, without a contract, a private company could cut benefits and salaries from day one. …

Ten Reasons Why Privatizing Your Water Utility Is a Bad Idea
Source: Jerry Ianelli, Miami New Times, April 3, 2017

… North Miami Beach, for example, wants to contract out its entire water system to CH2M Hill, a private global engineering firm. Today the city will vote on whether to begin negotiating with the company despite the fact that there’s likely an open FBI probe into the deal — and despite the fact that the water plant workers’ union really doesn’t like the idea and warns that up to 80 city employees could lose their benefits or their jobs.  …  But all of that aside, myriad studies show that privatizing water utilities makes them more expensive and less efficient. The very idea that private systems are inherently cheaper for consumers than public ones is silly: A private company is mandated by investors to make profit off the utility, and there’s only so much an outside firm can cut before rates begin to rise. …

Why private firms and the FBI are interested in North Miami Beach’s water utility
Source: David Smiley, Miami Herald, March 30, 2017

A plan to outsource the management of Miami-Dade’s second-largest water utility is supposed to improve the maintenance and operation of a struggling billion-dollar asset serving nearly 200,000 people in the county’s northeast corridor.  But so far, the proposal has only brought the city of North Miami Beach a messy union dispute, a political spat with progressives and, apparently, a federal investigation. Next week, city commissioners may authorize negotiations with CH2M Hill, one of the nation’s largest public works firms. The city is seeking to overhaul its waste water services and Norwood Water Treatment Plant in the wake of a consultant’s report that found its own managers have done a poor job. … Blasting the effort as a money grab, the city’s AFSCME chapter has teamed up with the local Democratic Party and a deep-pocketed political action committee to rail against the city’s plan. The acrimony has grown so intense that the FBI began asking questions, according to City Attorney Jose Smith. … But critics contend that “privatizing” the management of the Norwood Plant would place the vital utility in the hands of a corporation interested more in its profit margins than health standards. During a press conference outside City Hall Thursday afternoon, a small group of protestors and AFSCME union members said North Miami Beach’s “Republican mayor” is putting profits before people. CH2M Hill, protestors noted, manages Pembroke Pines’ water system, which was found recently by the Florida Department of Health to have unsafe levels of trihalomethane. … Additionally, an affiliate of the third-ranked Veolia Water North America-South, which would likely only get a shot at the contract should talks fall apart with CH2M and second-ranked U.S. Water/Wade Trim, was sued this summer by Michigan’s attorney general over its role in addressing the water quality in Flint, Michigan. … Smith said the city’s elected officials were unable to comment this week due to an ongoing cone of silence surrounding the competitive solicitation. If commissioners vote in favor of negotiations, a final contract would still need to be hashed out and returned to the commission for its approval.

North Miami Beach water utility assessed as inefficient, may be privatized
Source: Joseph Busato, Miami Herald, April 14, 2016

A recent evaluation and assessment of North Miami Beach Water Utility shows the service needs to improve in areas of cost effectiveness, risk reduction, systems and facilities upgrades, staff training and management skills. … The North Miami Beach utility provides water to neighboring cities such as Sunny Isles Beach, Aventura and Miami Gardens. In January 2015, Garcia hired professional engineer Jeff Thompson to be director of the city’s public utilities. He later told her the water department needs a thorough assessment. Garcia then asked the city council to hire a third-party independent consulting agency, Eisenhardt Group, LLC, to perform an operational assessment of the water utility. The study cost $194,000. … The city tasked Eisenhardt to evaluate the efficiency and effectiveness of the utility. Eisenhardt performed four different assessments, including on-site visits, workshops, employee interviews and analyzing records. The assessments were a checklist survey, a checklist of attributes of effectively managed water utilities, benchmark metrics (comparing performance to 100 other water utilities) and an action item list. … Eisenhardt told the council it had two early solutions to fixing the problems: hire consultants for about two years to better train utility workers, at a cost of about $3 million a year; or to privatize the utility. Vice Mayor Beth Spiegel questioned whether city employees would lose their jobs if the utility is privatized. Thompson told the Miami Herald that existing utility workers would “be transitioned” to the private company, but that some managers’ jobs could change depending upon their skills and abilities.