City of Milwaukee Comptroller Wally Morics has recommended the City of Milwaukee study whether to lease the Water Works to a private operator, in light of the city’s grim fiscal situation. According to Morics, privatizing the Milwaukee Water Works could bring the city $550 million to $600 million in income from a long-term lease to a private operator, with the money being set aside as an endowment that could generate some $30 million a year to keep city operations running. The Milwaukee Common Council has not ruled out considering privatizing the Water Works, with Common Council President Willie Hines labeling calls for the Common Council to kill the plan outright, “irresponsible” considering the City of Milwaukee’s fiscal difficulties.
Other cities have privatized their water utilities with mixed results. Atlanta privatized its water utility in 1999, but ended its 20-year contract with United Water Services in 2003, citing service problems. According to a letter from the Atlanta Department of Transportation, United Water failed to repair a recurring leak that had been a problem for at least two years, resulting in brown water and poor service. In addition to service problems, cities that have privatized their water supplies have been plagued by rate increases. After privatization, water rates in Hingham and Hull, Massachusetts more than doubled over a five-year period. After American Water Works took over the water operation for 40,000 customers in Huber Heights and parts of the Mad River Township in Ohio, the company increased its rates by 30 percent. And perhaps my favorite rate-hike horror story has to be the story of Pekin, Illinois (emphasis mine):
In 1982, Illinois-American, another subsidiary of American Water Works, acquired Pekin’s water system from a local private owner. In the 18 years that followed, rates increased by 204 percent.
According to Alderman Bob Bauman, chairman of the Common Council’s Public Works Committee, Milwaukee currently charges about half the maximum rates that would be allowed by the state Public Service Commission. Based on past precedent, a private water operator would surely raise rates as much as legally allowed, and the city, its residents, and likely their children and grandchildren, would have absolutely no say in the matter.
Opposition to the privatization plan, led by Keep Public Our Waters (KPOW), are organizing a rally in opposition to the Common Council’s refusal to take the issue of privatizing the Milwaukee Water Works “off the table” completely:
The Common Council is meeting next Monday, June 15th at 12:30 p.m.
We are organizing to fill the room with over 100 people that are in opposition to the idea of letting a private company take over our public water works. The ramifications of this include the likely decline in the quality of our water as well as raised water rates for everyone in the city and surrounding suburbs.
Also, our city is considering a 99 year lease which would put us in a long-term binding agreement with a multinational corporation with marginal ability to hold them accountable. It is imperative that we show up with a large group of people on Monday, June 15th at 12:30 p.m.
If you have a friend with a day off of work or an hour lunch break, please find a way to come and bring a friend. This is about getting citizens to show up and show the common council that we are watching and assessing their performance and that the citizens of this city do not want our water leased to a multinational corporation.
Lastly, we also have an online petition against the effort to privatize the water here in Milwaukee: