DEMOCRACY AND WATER: THE PRIVATE FOOT IN THE PUBLIC
From Burkina Faso to Yemen, private water corporations
have bullied their way into control of public water utilities
through the World Bank's policies. Loans to so-called
"underdeveloped" nations have been tied to requirements
that public water systems be turned over to private operators.
Now this kind of "foot in the door" scenario may be played
out on the American stage.
Senate Bill 1961, the Water Investment Act of 2002, aims
to provide crumbling water systems across the nation with
much needed funds for infrastructure improvements, as
well as aid for conservation programs and compliance with
new arsenic standards. This crucial bill, however,
was implanted with a poisonous provision which would have
required water systems to "consider" privatization measures
before being eligible for federal funds. Due to
the tireless efforts of Public Citizen's Water for All
campaign, this language has been removed.
But a similar bill in the House still contains such requirements,
which may be reinstated in the final legislation when
the final House and Senate bills are combined. It
is crucial that this language be absent from the final
bill - these provisions may not be enough to be a deal-killer
on such an important piece of legislation.
Just what did the Senate bill prescribe? At issue
was Section 103 (j)(1)(b), under "Requirements for Receipt
of Funds". It read: "...a State may provide assistance
from the water pollution control revolving fund of the
State for a project only if the recipient of the assistance--
1)has considered-- A) consolidating management functions
or ownership with another facility; B) forming private-public
partnerships or other cooperative partnerships..." (emphasis
added). As Water for All's researchers astutely
observed, the word "considered" was undefined, and it
would be left to the courts to say how far a public utility
would have to go to meet this requirement. Would
it simply mean that water officials must put the matter
on the agenda for discussion?
Or would consultant and attorney fees have to be expended
to thoroughly explore the issue?
The House bill in question contains equally vague language
in Sec 122 (c) (13) (c), in which water providers are
required to "analyze the cost effectiveness of alternative
management and financing approaches (...including public-private
partnerships)." HR 3930 was introduced in March
of this year by John Duncan (R-TN) and Peter DeFazio (D-OR)
in the House Water Resources and Environment Subcommittee.
It has since been discharged from the House Transportation
and Infrastructure Committee and referred by
the Ways and Means Committee. Just when it will
hit the floor is anyone's guess.
A strong supporter of the privatization provision is
Andy Shea, a representative of the National Council
for Public-Private Partnerships, whose website proclaims
the wonders of privatization in all aspects of the economy.
In his testimony before the Water Resources and Environment
Subcommittee, he said the provision will help "address
the funding gap" in the water industry, although he added
the caveat that he would like to see that the concept
"does not absolutely require a community to pursue a partnership
as a condition" of State Revolving Fund assistance.
Opponents of the provision, such as the American Federation
of State, County and Municipal Employees (AFSCME) and
Public Citizen, say the language does make explicit such
a requirement and that it should be removed entirely.*
When public water officials sit at a utility board
meeting or city council meeting, we are supposed to look
at the democratic, financial, and environmental consequences
of the decisions before us. This kind of
legislation assumes that those decisions are purely economic
in nature. Forcing cash-strapped utilities to turn
to the private sector for funding may lead to a "deal
with the devil" of the sort now experienced by Atlanta,
Ga. and Milwaukee, Wis.
In Atlanta, reports of dirty tap water, dry hydrants
and poor customer service led the city to begin an audit
of the private company contracted in 1998 to run their
system. In Milwaukee, the private contractor, United
Water Services, figured it could save money by temporarily
shutting down wastewater pumps, which resulted in 107
million gallons of sewage being discharged into Lake Michigan
and surrounding streams. A for-profit water utility
pursues such cost cutting measures for the same reason
a lion pursues antelope- it is simply in its nature.
Profits must be maximized, costs must be reduced, and
water is simply another commodity for sale.
Members of the Alliance for Democracy understand that
water is a human right, not a commodity. Democratic control
of our water systems is essential to prevent profiteering
and to maintain a healthy environment and community.
We are committed to fighting for democratic control of
these institutions, and
we will continue to keep you updated on these issues.
Tualatin Valley Water District
Please contact Representative Peter DeFazio and Rep.
David Wu (who recently signed on as a co-sponsor of HR
3930) and let them know how you feel about this issue.
Rep. Peter DeFazio
2134 Rayburn HOB
Washington, DC 20515-3704
or contact his Eugene office at:
or toll-free (800) 944-9603
Rep. David Wu
1023 Longworth HOB
Washington, DC 20515-3701
Fax (202) 225-9497
or contact his Portland office at:
620 SW Main, Suite 606
Portland, OR 97205
*AFSCME's statement against this provision can be found
Public Citizen's Water for All campaign can be found at
Public Citizen- Water for All
US Water News www.uswaternews.com
American Water Works Association's MainStream
Office of Representative David Wu
National Council for Public-Private Partnerships