By Brendan Agnew
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 Good and Veolia were brought in to assist the city with the management and improvement of its outdated water infrastructure in 2012.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.