NLG MD Signs Statement of Opposition to Any Form of Privatization of Baltimore’s Water Utility

The Maryland Chapter of the National Lawyers Guild has joined a coalition of groups signing the following statement:

TO: Mayor Catherine Pugh
CC: Council President Jack Young, Comptroller Joan Pratt, Public Works Director Rudy Chow and Members of the Baltimore City Council

We, the undersigned groups, call on you to reject any form of privatization of Baltimore’s water and sewer systems and to support full public operation and management of these essential services.

City officials have had conversations with American Water, the largest water corporation in the United States. American Water aggressively seeks to purchase municipal water and sewer systems – the most extreme form of water privatization. Privatization is the wrong direction for Baltimore’s water utility.

Privatizing water services typically results in worse service at higher costs:

Privatization can lead to degraded services. There is ample evidence that maintenance backlogs, increased water losses, sewage spills and lamentable customer service often follow privatization. In fact, poor performance is the primary reason that local governments reverse the decision to privatize and resume public operation of previously contracted services. Private operators may attempt to cut corners to cut costs and maximize their profit. They may use inferior construction materials, delay needed maintenance or downsize the workforce, which impairs customer service and slows responses to emergencies. On average, after privatization, private operators cut one in three water utility jobs.

Privatization can result in higher costs for the public. Corporate profits, dividends and income taxes can add 20 to 30 percent to operation and maintenance costs, and a lack of competition and poor negotiation skills can leave local governments with expensive contracts. Perhaps for those reasons, a review of 18 municipalities that ended their contracts with private companies found that public operation averaged 21 percent cheaper than private operation of water and sewer services.

Privatization leaves communities without local control of their water. Privatization contracts would tie the hands of Baltimore’s elected officials, restrict public access to information and transparency in services, and limit public accountability in decision making. A private water company is first and foremost accountable to its investors, not necessarily to the people it services. Baltimore could potentially be giving away the authority to make decisions about water, our most precious resource, at a time when water is being seen as a commodity by many in Wall Street.

We need responsible, public operation of our water and sewer utility, so that we can work to ensure that every Baltimore resident has access to safe and affordable water service.

Thank you for your time and consideration of this important issue.

 


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