We Can Improve Our Water Systems Without Tripling Household Bills
By Mary Grant, Food and Water Watch
If you're a regular denizen of a U.S. city, water infrastructure is probably out of sight and out of mind - that is until you have to boil your water before drinking it, or your water bill skyrockets, or a clogged sewer pipe swamps your lawn or a broken water main floods the road stopping traffic.
While it isn't always obvious, our nation's water infrastructure is facing a funding crisis. The American Society of Civil Engineers recently estimated that we're falling $55 billion short each year on funding the improvements necessary to ensure safe and sound water and sewer service. Without greater investment, that gap will reach $84 billion by 2020. The American Water Works Association estimates that renovating our aging utilities will cause water bills to triple in some places.
So, how do we address this shortfall and protect consumers from high bills?
Some water industry players, politicos and liberal policy wonks think the answer lies in a national infrastructure bank that encourages private investment through public-private partnerships - deals that privatize the operation of a system while the public retains ownership and ultimate responsibility.
The Obama administration has called for such a bank, and earlier this month, the Center for American Progress endorsed the concept in a new report. While well intentioned, their plan relies too heavily on private investment to really get the job done right.
Theirs is not a solution; it's a red herring. In the water sector, public-private partnerships rarely involve leveraging private financing from a water company because it tends to be much more expensive than municipal bond funding. For the vast majority of these deals, a private company simply takes over the operation of a system while the local government continues to finance improvements.
Not only do public-private partnerships fail to address the funding issue, but they frequently lead to degraded service and higher costs for the public.
Public-public partnerships, on the other hand, are uniquely suited to help address our water funding needs and mitigate rate increases. Food & Water Watch released a report today about this innovative model.
A public-public partnership is a collaboration between two or more public entities to improve public services on a not-for-profit basis. By bringing together two or more public entities to pool resources, buying power and technical expertise, these partnerships can leverage the capacity of public utilities to improve service and control costs. What's more, recent studies have found that these public-public partnerships outperform public-private partnerships in terms of efficacy, efficiency and equity.
In short, public-public partn