Organized agitators stir antagonism to private operations of water system

Tuesday July 22, 2003

By Martha Carr
Staff writer

With voices raised and arms waving, more than a dozen residents on Monday made impassioned pleas to the Sewerage & Water Board to abandon its privatization drive, a process one group called a "full-fledged fiasco."

The fiery petitions, punctuated with applause from the almost 30 residents who gathered to oppose private management, came during a public hearing at Light City Church in the Lower 9th Ward. The meeting was the first of six the board scheduled to get feedback on a draft bid proposal that, once
finalized, will serve as a blueprint for private companies and an employee group interested in managing the city's water and sewer operations.

"Let's just end this process," said Beth Butler of ACORN, a community action group [headquartered in Brooklyn, New York], that has teamed up with the Service Employees International Local Union 100 and Washington, D.C.-based Public Citizen to oppose the process. "It's already  cost $5 million of public money that could have been used to fix the sewer system."

The water board voted last week to open bidding on the roughly $1.5 billion contract to any interested company, after two of the three firms the board deemed qualified indicated they may not bid. It also voted to abandon privatization altogether if only one private company bids on the job.

As it stands now, USFilter is the only company known to be seriously considering vying for the 20-year proposal. A group of employees, called the Managed Competition Employee Committee, has also indicated it intends to bid.

Among the issues raised by privatization opponents were whether there were any other interested bidders; whether the winning bidder would be required to retain the current employees and provide appropriate staffing; and whether the winning bidder would be allowed to ask for more money down the road through change orders.

"These companies have a thing called profit," said Mel Jones of New Orleans. "And where is that going to come from? Rate increases or laying people off. I can't tell you the Sewerage & Water Board has done a great job. But at least with rate increases we have some say in it. Privatization takes that totally out of our hands."

Several residents also said they had serious concerns about turning over the operation of the city's water and sewer systems to a company from outside the United States. USFilter is a subsidiary of the French company Veolia Environment, formerly Vivendi. Several other major water and wastewater operators are also based outside the United States.

"I'm concerned with having such a vital need as water placed in the hands of people from another country," said Marietta Williams.

Speaking in favor of privatizing the system, USFilter vice president David Smith said sewer rates will jump 167 percent between 2000 and 2006 if nothing is done to cut costs.

He also defended his company's record and its operation of the city's two wastewater treatment plants, both of which drew fire from some residents. Smith was one of three people who supported the proposed contract at the meeting. The others were his wife and another USFilter official.

The draft bid proposal, which defines the services the companies and the employee group would be providing, is available for review at all New Orleans public library branches. The document also is available online at the water board's Web site, www.swbnola.org.

For information, call (504) 585-2175.