Impact Water

Your Tap Water Could Be America's Biggest Infrastructure Scam

The big battle is between privatization and public control of your city's water.
June 7, 2017, 6:11pm
Photo via Wikimedia Commons

Infrastructure is a big buzz word around D.C. right now, trailing not too far behind "Comey" and "Covfefe." The highly anticipated infrastructure bill from the Trump administration is expected sometime in the fall, and in the meantime advocacy organizations, potential contractors and lawmakers are doing everything they can to best position themselves and their constituents. High on the list of contentious issues is water, namely America's water infrastructure. For many cities and counties, water infrastructure is crumbling and it's in desperate need of repair. Think Flint, Michigan or Pittsburgh, Pennsylvania.

The fate of the nation's water systems and the availability of clean water to individuals will largely depend on the outcome of the ongoing public policy debate between privatization and public control and adequate investment. Considering that most Americans get their water from publicly-controlled systems, this is a particularly hot topic as momentum builds within the Trump administration for privatization.

Leading the charge in support of public control is Food & Water Watch, a national advocacy group that takes on special interests and emphasizes accountability for elected officials. VICE Impact chatted with Mary Grant -- Campaign Director for the organization's Public Water For All campaign -- about how the push for water privatization could be one big infrastructure scam for local governments.

VICE Impact: Food & Water Watch put out a statement yesterday about concerned trends towards privatization. What's next in the process?

Mary Grant: So far, the Trump administration has only put out this little fact sheet attached to its budget. And it seems like the Trump administration is putting forward a plan that relies heavily on privatization of our essential infrastructure. The next step is that he's going to work to try to get a bill through Congress.There's widespread opposition to this plan that relies on privatization because it won't meet our infrastructure needs. We need direct, public, federal dollars put into our infrastructure. Particularly our water system.

This has been a contentious issue before Trump was in office. What are some of the big picture trends that you've seen when municipalities or counties have gone towards privatization?

Rates go up. It's a myth when you talk about privatizing infrastructure assets like water systems, and think that it's going to reduce the cost of the service — it doesn't, you pay more when private companies take over water systems. On average nationwide, private for-profit utilities charge households 59% more than local governments charge. This adds a couple hundred dollars a year onto a typical household's annual water bill.

Private companies extract profit from communities when they go in. Water systems are natural monopolies; you have no competition, [people have] no choice at the tap. So, there's no incentive for them to be more efficient.

What's the incentive then, for the municipality, the local government, to go private?

Municipalities are cash strapped. It's not about making water systems better or more effective, it's about using it as a way to shore up other financial problems, and resolve some debts. They want to use their water systems as cash cows to pay for other government services.

But that's a way to also bypass having to increase property taxes, but in a way you're actually taxing through the tap because people are going to pay more through their water rates. So it's just a terrible way to raise revenue for city functions.

What is the general state of affairs of the country's water infrastructure right now?

Nearly nine out of ten people with public water service get it from a publicly owned system. So, public water is definitely the way that most people get their water service. We're seeing growing threats to our water service and we're learning more about the contaminants in our water systems and needing to make major improvements to treatment capacity. But our water systems are aging, and we need to have a major federal investment in our water systems.

We're also facing a looming affordability crisis. Some cities like Flint and Detroit and Baltimore are already in the middle of it. So, there needs to be real solutions. There was a study out of Michigan State University earlier this year that found that within the next five years: more than one-in-three households could be unable to afford their water bills. So, we really need a drastic change to the way we're funding our water systems; we need direct federal support, and we need income-based water affordability programs.

What can individuals who are concerned about water privatization do about it?

You need to make sure that you have local, public control of your water systems — work with your city council to make sure that they're not considering these privatization offers. You can pay attention to local government, you can also get involved, there's a lot of really good efforts at the local level to prevent privatization but also to support affordable water services.

Philadelphia recently passed a bill to make income-based water billing for low-income residents — a really comprehensive solution to water affordability problems. So there's really great local solutions that are happening if you have that local control over your water assets, and you're not privatizing it to these large companies.

What are some of the options that are available to them on the national level?

You can support the Water Act, by Representative John Conyers [D-Mich.], it's a comprehensive solution for our water infrastructure needs. It makes Wall Street pay their fair share by closing tax loopholes on oversea profits to directly fund our water infrastructure and meet our water infrastructure needs. And you can oppose Trump's infrastructure plan -- it's that's not going to help our water systems it's only going to make things worse.

You can learn more about the issue, including steps to take action, here.

This interview has been edited for brevity and clarity.