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Blog Posts: Water utility

July 2nd, 2015

Pittsburgh Residents File Suit Over Water Overcharging

By Brendan Agnew Faucet

The Pittsburgh Water and Sewer Authority (PWSA), the provider of water service to roughly 300,000 customers, is facing a multi-million-dollar lawsuit. The suit, which seeks class action status, charges that many residents who had “smart meters” installed saw their bills skyrocket unexpectedly, some of them by as much as 600 percent.

According to the suit, the new meters, which were supposed to provide more accurate readings of water use, were prone to drastic measurement errors, in one case charging a property owner for 132,000 gallons on a vacant property. Customers who couldn’t pay these inflated bills were issued shutoff notices despite complaints to the PWSA. The suit points out that PWSA is “acutely aware” of the overbilling but “[did] not hesitate for a moment to issue ‘shut off’ notices and then arbitrarily turn off water service.

PWSA recently hired a new executive director, Jim Good, a former executive vice president of Veolia Water’s West Region. Good and Veolia were brought in to assist the city with the management and improvement of its outdated water infrastructure in 2012. The PWSA maintained governance over the system, with Veolia Water providing “day-to day management” and “diagnostic evaluations of Authority operations,” according to a PWSA press release.

Veolia oversaw management of the Authority when it began installing the new meters in April of 2014. The company makes much of its global revenue through implementing advanced metering infrastructure (AMI) technology such as the meters in question in the lawsuit. When the PWSA renewed its contract with Veolia earlier this year, the company cited its water meter replacement program as a highlight of its work in Pittsburgh, pointing to the added revenues more accurate billing could bring to the city.

Veolia has become notorious for unfair billing practices and mismanaging water systems, prompting a host of U.S. cities to cut ties to the company. As part of a larger utility transformation, the city of Indianapolis famously cut its engagement with the company more than a decade short in 2013, following similar accusations of overcharging and misconduct. Other cities have dropped Veolia over service complaints, while residents of Baltimore and St. Louis successfully fought to keep their cities from contracting with the company.

Pittsburgh residents have also seen spikes in water and sewer rates over the past year. The PWSA implemented a 4 percent rate increase this year, reportedly to cover costs of infrastructure updates, according to a report by Pittsburgh’s Tribune Review. Despite the rate increases, just prior to the litigation, PWSA hired Jim Good as its permanent head with a salary of $240,000 a year, plus potential bonuses, making him Pittsburgh’s second-highest paid government official, eclipsing even Mayor Bill Peduto, who is paid less than half as much.

The city will scale back Veolia’s contract as Good takes on a more central role and as the authority fills the remaining management positions. Hopefully, the public managers will work to improve affordable access to water in Pittsburgh.

Brendan Agnew is a Food & Water Watch summer water research and policy intern and a recent graduate from American University

April 28th, 2015

Truth from the Tap: A Water Industry PR Blitz

By Darcey Rakestraw

Click here to download a copy of our Borrowing Trouble report

Read one of our latest reports on water privatization.

The National Association of Water Companies (NAWC) has launched a new campaign, truthfromthetap.com, to undermine advocates who want municipal water systems operated and owned by local, democratically elected councils—not by big companies accountable to shareholders.

But the truth is, the private water operators behind the site have a poor track record when it comes to serving communities. Company executives drive the management decisions, not locally accountable water boards, and they have a financial incentive to cut service, cut maintenance and cut the workforce. This often results in delayed repairs and slow responses to customer service requests. There is ample evidence that maintenance backlogs, wasted water, sewage spills and service problems often follow privatization. In fact, poor performance is the primary reason that communities demand their local governments reverse the decision to privatize and resume public operation of previously contracted services.

For many communities, frequent and massive rate increases are the most pronounced consequence of privatization. On average, private sector companies charge higher water and sewer rates than local government utilities. For example, a 2010 survey of the largest water utilities in the Great Lakes region found that privately owned systems charged more than twice as much as municipal systems. The researchers attributed this difference to private companies’ taxes, profits, higher overall service costs, and ratemaking practices.

You don’t have to look far to find examples of failed privatization efforts:

  • Within a year of Veolia taking over the water system in Indianapolis, thousands of residents experienced billing problems and consumer complaints more than doubled. In 2005, because the company lacked proper safeguards, an error caused a boil-water alert for more than a million people, closing local businesses and canceling school for 40,000 students.
  • The privatized system in Gladewater, Texas violated federal water quality standards 16 times, and residents described the water as “dark brown” and “foul.” The company failed to perform work required by its contract, and its water plant operators were lacking the necessary certification.
  • In Gary, Indiana, after United Water downsized the workforce, residents experienced numerous service problems. In May 2008, a state inspection found that the district, under United Water’s management, violated discharge limits 84 times from 2005 to 2007.
  • The New Jersey State Comptroller’s Office issued a scathing audit of United Water’s Camden, NJ It found that inadequate contract supervision and the company’s poor performance cost the city millions of dollars.

Read more examples here.

Lifting the veil on industry attacks of advocates

It’s no wonder that communities get wary when they hear their local water system may be considering some form of privatization. To combat this resistance, the water industry’s latest PR campaign asks, “Why are activists meddling with your water?” The strategy appears to be to confuse people by equating the relatively meager resources backing public interest groups to the massive resources of industry.

Financial support from our more than 70,000 members keeps us independent of corporate and government influence—enabling us to take uncompromising positions and win strategic fights that threaten industry interests.

The growing numbers of industry-backed attacks on Food & Water Watch actually underscore our effectiveness, and are a good example of why some donors do not want their names publicized. It is their right to remain anonymous, and we guard our members’ privacy in order to protect them from harassment. GuideStar, a top source of information about nonprofit transparency and best practices, recently gave us their GuideStar Exchange Seal, demonstrating Food & Water Watch’s commitment to transparency.

What’s not so transparent is how the water industry lobbies to secure their interests. Comprised of large U.S. water companies and the U.S. subsidiaries of multinational corporations like Suez, the NAWC has been a member of the controversial American Legislative Exchange Council (ALEC), alongside Koch Industries and ExxonMobil. ALEC works to ensure that state legislation is modeled to support its industry-friendly policy goals, including deregulation and privatization. One of its bolder resolutions has been one to dissolve the Environmental Protection Agency. ALEC has even backed restrictions on voting.

Some companies, such as Amazon, Coca-Cola and more recently, Google, have backed out of ALEC because of its reactionary agenda. But in 2012 NAWC publicly defended its membership in ALEC, and, as journalist Sarah Pavlus noted, it’s not the industry’s only dubious association: American Water’s Pennsylvania subsidiary and Aqua America have partnered with the oil and gas industry on a lobbying effort to expand fracking (water companies sell the industry water used in fracking operations, and also recognize that the treatment of wastewater from fracking is a lucrative business opportunity.)

The solution

Instead of promoting private involvement in municipal water systems in the form of public private partnerships, the federal government should adequately fund water infrastructure projects. It’s understandable that communities consider private investment to improve crumbling systems: much of our country’s water infrastructure is nearly a century old, and many community leaders look to lease their water systems out to address budgetary shortfalls.

However, instances of water privatization are still pretty rare in the U.S. As of 2012, only six percent of local governments contract their drinking or wastewater services to private, for-profit entities. Since 2000, major water companies have lost 169 contracts in the United States.

That’s because communities have learned the hard way that they can do better. Part of democracy is asking local and federal leaders to stand up for what’s right when it comes to the things we can’t live without. We cannot live without water.

The real truth from the tap

These brazen water industry attacks underscore that advocates and communities are being effective in their work every day to protect our essential resources. They also present an opportunity to talk about how big companies attempt to sway the debate around important issues like how our water should be managed.

April 13th, 2015

Protecting the Human Right to Water, One System at a Time

By Kate Fried Toast_Glasses_Water

With thousands of households in Detroit and Baltimore facing water service shutoffs, and a drought looming over California, it might not seem like there’s much good news in the world of water these days. But the recent publication of Our Public Water Future: The Global Experience of Remunicipalisation highlights the advances made in communities around the globe to take back water as a public good, and reminds us that that we can and should enjoy unfettered access to safe, clean, affordable water, as long as it’s managed as a common resource, not a commodity exploited by corporations.

What is remunicipalization, exactly? It’s when a community resumes public operation and management of its water system, often after private operation has failed customers in some way. We’ve documented at length the problems experienced by customers of privatized water systems—higher rates, poor service and lack of accountability being some of the most egregious examples. It’s no wonder then that many communities opt to reclaim control of their drinking and wastewater systems. Read the full article…

April 3rd, 2015

Reality Checking Our Water Woes

By Darcey O’Callaghan and Kate FriedWater_Faucet

This week while promoting his new music service, Tidal, Jay Z made a well intended but nonetheless tone deaf statement, gushing about the beauty of supposedly “free” water service. While tap water may seem free to a rap mogul, those in Detroit who have been living without this essential service because they cannot afford to pay their water bills are singing a very different tune. In a seemingly unrelated development, the New York Times published an editorial that day claiming that water isn’t priced highly enough and thus isn’t properly valued. Both statements were wrong, and reflect some fundamental misconceptions about how our society views and values water. Read the full article…

March 6th, 2015

Capitol Hill’s Other Funding Battle

Water_Manhole_CoverBy Kate Fried

As the battle to fund the Department of Homeland Security quelled this week, another funding controversy quietly took shape. EPA Administrator Gina McCarthy announced plans to cut the department’s main wastewater fund by 23 percent in 2016. The Clean Water State Revolving Funds (CWSRFs) are the primary source of federal funding for our wastewater and storm water infrastructure, critical to keeping our wastewater systems in working order. You don’t want to image a scenario in which they can’t. Read the full article…

November 21st, 2014

The Last Straw for Irish Citizens: The Struggle Against Water Charges

By David Sánchez

IrishRight2WaterA European country in crisis. Men in black come to the rescue. With the complicity of the national government, they impose painful measures on the population. Men in black never forget to be nice to their friends, so the measures include a provision to privatise public water services. As a reaction, massive citizen’s mobilisations take place. The story sounds familiar, doesn’t it?

We have already experienced this situation in Greece, and just a few months ago, Greek citizens won the battle, and water will remain in public hands. Now history repeats itself, and the struggle against water privatisation and commodification is at boiling point in Ireland.

The Memorandum of Understanding signed between the Irish Government and the men in black (also known as the Troika, formed by the European Commission, the International Monetary Fund and the European Central Bank) provides for the introduction of domestic water charges and the establishment of a new water utility, Irish Water, easy to be privatised in the near future. In a nod to their cronies, the men in black tapped former Irish Minister of Environment Phil Hogan, who led the implementation of these changes, as the new European Commissioner for Agriculture and Rural Development.

Following months of protests and resistance, on November 1, more than 150,000 people mobilised across Ireland to oppose the changes. Water charges in Ireland will discriminate against those with less economic means and the unemployed, adding another regressive tax at a time when citizens have been asked to make too many sacrifices to solve an economic crisis which they did not cause. Ireland’s public water system is already paid for through general taxation, which is progressive, and charges commercial users. The Irish people have already shown that they wish it to remain that way.

Once again, European citizens should raise their voice against water privatisation and commodification. Food & Water Europe, together with our allies at the European Water Movement, want to express our solidarity with Irish citizens. Resisting water charges means fighting for access to water as a universal human right, and against the commodification of water. And it means blocking future privatisation attempts.

When will the European Commission finally get the message? Its provisions to privatise water failed in Greece, and they will fail in Ireland if citizens continue with their mobilisation. People in the streets of Dublin, Madrid or Athens; citizens voting in Thessaloniki, Rome or Berlin; nearly 2 million Europeans signing the Citizens Initiative on the Right to Water. All of them are claiming water as a public and common good. Men in black should be nice, for a change, to their citizens — not to their friends.

You can support the Irish campaign on the Right to Water here.

 

October 31st, 2014

Water Markets: A False Solution to a Real Crisis

Water_Protest_VolunteersPutting a public resource in the hands of the wealthy will not solve California’s water crisis

By Mitch Jones

If we have learned anything from the water shut-offs in Detroit and the ongoing water crisis in the Western U.S., it is that every community deserves access to safe and reliable water, regardless of its ability to pay. Yet a new movement is afoot to transfer control of our water to new water markets. Despite the evidence privatizing water doesn’t work, water privatization and market-based schemes are still being pushed upon the public as a solution. Specifically, we are seeing the idea of water markets gain attention, especially in response to the Western drought.

While not a new idea, the widespread use of water markets, which represents the financialization of all of our common resources, is relatively new. They are a false solution that assigns the benefits of our investment in this common resource to a small few at the expense of everyone else, and do little to ensure adequate supply to anyone.

We know that large financial institutions dream of water markets. In fact, Willem Buiter, Chief Economist at Citigroup, has written of his desire to see a global water market: “I expect to see a globally integrated market for fresh water within 25 to 30 years. Once the spot markets for water are integrated, futures markets and other derivative water-based financial instruments — puts, calls, swaps — both exchange-traded and OTC will follow…. Water as an asset class will, in my view, become eventually the single most important physical-commodity based asset class, dwarfing oil, copper, agricultural commodities and precious metals.” Read the full article…

April 10th, 2014

Taking a Stand Against the Corporate Water Grab in Portland, Oregon

By Alley Blom and Julia DeGraw

Here at Food & Water Watch, we know that profit-driven motives often clash with providing clean, safe drinking water for the public. This is why in Portland we oppose the corporate-funded initiative that attempts to fix what’s not broken. Otherwise known as The Water District Initiative, this proposal would shift the regulatory power of our water and sewer systems to an elected water board, creating a new water district to govern our local drinking water. And while we support local control of our water systems, this water board could allow corporate polluters to shift the costs of pollution they cause onto to the backs of taxpayers.

Currently, the Portland City Council oversees the Portland Water Bureau and the Bureau of Environmental Services – the two agencies responsible for running our sewer and water system. This initiative would remove the authority of these long-standing agencies that have effectively and transparently overseen our water system and hand it over to a potentially inexperienced water board without the proper oversight. Under this initiative, previous employees of the municipal water system wouldn’t be allowed to run for this board, yet someone from a corporation who would stand to benefit from deregulation could.

You may wonder, how this initiative came to be. Well if you follow the money, you’ll see that five giant corporate backers have covered more than 90 percent of the campaign costs. This raises concerns that water board elections could also potentially be bought by these corporate interests. For example, two companies that support this initiative, Portland Bottling Company and major polluter Siltonic, stand to benefit from the creation of a new water board that they could stack with their own handpicked members. Passage of this measure could lower water rates for these major water users and polluters while probably raising them for Portland families. Read the full article…

March 27th, 2014

Cities Don’t Need Expensive Private Financing Gimmicks

By Mitch Jones 

This week, the U.S. House Transportation & Infrastructure Committee’s special Public-Private Partnership Panel held a roundtable discussion on the use of public-private partnerships (P3s) in water and wastewater systems. I was pleased to represent Food & Water Watch as the only witness critical of these needless corporate get-rich schemes. 

Read the full article…

March 21st, 2014

Five Ways You Can Make a Splash On World Water Day

By Katherine Cirullo

Water is life. Water is also a limited resource that’s under high demand. Here at Food & Water Watch, we’re fighting a global battle to protect the right to safe, clean, affordable water for everyone now, and for years to come. It’s a battle that we care deeply about and it pervades many of the issues we work on. That’s why tomorrow, on World Water Day, we’re inviting you to dive in and join us in the fight to promote sustainable water management, protect the human right to water and prevent the impending global water crisis. Here are five ways you can take action on World Water Day.

1. Add these two inspirational gems to your spring reading list: Blue Future and Ogallala Road. These profound, yet comprehensive books offer unique perspectives on the past and future of the water crisis:

Blue Future: Protecting Water For People and the Planet Forever by internationally best-selling author and Food & Water Watch Board Chair, Maude Barlow, exposes the handful of corporate players whose greed is impeding the human right to water. The latest in Barlow’s best-selling series, Blue Future lays out the obstacles ahead in this looming water crisis, as well as the many victories that have been won by communities in the fight to protect their right to water.

Ogallala Road: A Memoir of Love and Reckoning by Julene Bair is a powerful personal history of her family’s western Kansas farm located on the Ogallala Aquifer. In the narrative, Bair reveals the struggles she grappled with when watching her family switch from dry-land farming to unsustainable irrigation. The story is a telling glimpse into one aspect of the world’s water saga. Visit her website for book events and appearances.

2. Encourage your classmates to kick the bottled water habit and to take back the tap! Be the force of change on your college campus by joining this year’s Tap-A-Palooza contest: Read the full article…

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