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Privatizing Water Increases Risk

February 21, 2011

The 2011 Georgia Senate will once again consider a bill that would legitimatize public-private partnerships with the goal of increasing water supplies.  In other words, the bill would make it easier for local governments to select private contractors and obtain financing to build new reservoirs and water pipelines.  Catches?

First, once we privatize what is historically considered a public good, the consumers’ municipal drinking water costs will increase.  Private companies will expect a return on their investments in ways that municipal governments do not.  Furthermore, according to the logic of the free market, as drinking water becomes a scarce commodity in an artificially competitive marketplace, costs will increase.  More worrisome: if customers do not materialize, service and water quality will decline.

Second, this plan will not help resolve the tri-state water war or meet the terms of the Magnuson order by 2012.  The private-public water bill’s sponsor, Senate Natural Resources Committee Chairman Ross Tolleson, R-Perry, stated this bill is a tool for long-term projects “around this state” that will be completed over “25 years.”

Third, when “You mix condemnation powers with private enterprise,” as Rome City Manager John Bennett (who also chairs the Coosa-North Georgia Regional Water Council) commented in the Rome Tribune, you may want to read the bill’s fine print.  With this in mind, new public-private reservoirs and pipeline right-of-ways might cater to very specific economic and geographic constituencies.

As the above news coverage mentions, the 2010 session did indeed consider a public-private reservoir bill; it crashed and burned dramatically.  Furthermore, you might want to read up on what it takes to manage public and private reservoirs in Georgia and the nation.  Reservoirs can be an easy sell when everybody is thirsty but it’s not always clear that the absolute intended purpose of new reservoirs will be just for water supply.  Water supply must be the highest purpose for which to manage any new reservoir funded with taxpayer dollars.

-Chris Manganiello

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4 Comments leave one →
  1. garivernetwork permalink*
    March 30, 2011 3:26 pm

    Update: As we approach the end of the legislative session, the public-private reservoir bill is still alive despite pointed criticisms from environmental groups (many along the lines of the key issues that Chris outlined in this post, above).

    The AP has a detailed story out today: http://www.timesfreepress.com/news/2011/mar/30/environmentalists-say-georgia-reservoir-bill-flawe/

    -BE

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