20190311CAIA to Suez 1-22 - Redacted.pdf

James M. Piotrowski
PIOTROWSKI DURAND, PLLC
P.O. Box 2864
1020 W. Main Street, Suite 400
Boise,Idaho 83701
Telephone: (208)33 I -9200
Facsimile : (208)3 3 | -920 I
Email: [e-mail]
Attorneys for Intervenor
Citizens Allied for lntegrity and Accountability
IN THE MATTER OF THE JOINT
APPLICATION OF SUEZ WATER
IDAHO AND EAGLE WATER
COMPANY FOR THE ACQUISITION OF
EAGLE WATER COMPANY
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
CASENOS. SUZ-W-I8-02
EAG-W-18-01
CITZENS ALLIED FOR
INTEGRITY AND
ACCOUNTAB ILITY'S RESPONSE
TO SUEZ WATER IDAHO INC.
FIRST REQUEST FOR
PRODUCTION
Intervenor Citizens Allied for Integrity and Accountability hereby provides its
Responses to Suez Water Idaho, Inc.'s first set of requests for production.
CAIA reserves its right to amend, supplement or revise these responses as n@essary and
appropriate. As to each such response, CAIA incorporates each of its other responses, to the extent
relevant. As to each response, CALA designates its President, Shelley Brock as its "sponsoring
witness."
DATED this 8ft day of March,2}lg.
PIOTROWSKI DURAND, PLLC
James M. Piotrowski
Attorney for Petitioner CAIA
Citizens Allied for Integrity and Accountability
Case Nos. SUZ'W-18-02 / EAG.W-18-01
RESPONSE TO SUEZ WATER rDAHO rNC. FrRST REQUEST FOR PRODUCTION
Request No. 1: Please provide copies of any and all organizational documents pertaining to
CAIA, including (without limitation) any and all articles of associatiorq bylaws, resolutions or
minutes, and other documents related to CAIA's participation in this proceeding.
Response: Intervenor objects that the request seeks, in part, documents protected by
attomey client privilege, and is not calculated to lead to the discovery of relevant information.
Subject to and without waiving the objection, lntervenor is providing requested documents with
redactions where the documents discuss attomey-client communications.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 1: Please provide copies of any and all organizational documents pertaining to
CAIA, including (without limitation) any and all articles of association, bylaws, resolutions or
minutes, and other documents related to CAIA's participation in this proceeding.
Response: Intervenor objects that the request seeks, in part, documents protected by
attorney client privilege, and is not calculated to lead to the discovery of relevant information.
Subject to and without waiving the objection, Intervenor is providing requested documents with
redactions where the documents discuss attorney-client communications.

Citizens Allied for Integrity and Accountability, Inc. Page 1 of 4
Articles of Incorporation
Citizens Allied for Integrity and Accountability, Inc.
ARTICLES OF INCORPORATION
(Revised 8-1-2016)

The undersigned, acting as the incorporator of a nonprofit corporation (“Corporation”) organized
under and pursuant to the Idaho Nonprofit Corporation Act, Chapter 3, Title 30, Idaho Code
(“Act”), adopts the following Articles of Incorporation (“Articles”):

ARTICLE I: Name
The Name of the Corporation is Citizens Allied for Integrity and Accountability, Inc. (C.A.I.A.).

ARTICLE II: Nonprofit Status
The Corporation is a nonprofit Corporation.

ARTICLE III: Period of Duration
The duration of the Corporation is perpetual.

ARTICLE IV: Mailing Address, Register Office and Agent
The mailing address of the Corporation is in the City of Fruitland, County of Payette, and in the
State of Idaho: P.O. Box 922, Fruitland, ID 83619-0922. The address of the initial registered
office is 2945 1st Lane E., Parma, ID 83660 and the name of the official registered agent at this
address is Alma Hasse.

ARTICLE V: Purposes
The purposes of the Corporation are to:
1. Represent a coalition of individual United States residents committed to increasing the
accountability of government agencies and ensuring that the interests of the people take
precedence over the desires of corporations and special interests;
2. Participate in public processes in order to promote the preservation of private property
rights, public infrastructure, public health, public safety, and public order;
Citizens Allied for Integrity and Accountability, Inc. Page 2 of 4
Articles of Incorporation
3. Educate about misinformation and government actions that harm and/or fail to protect
private property rights, public infrastructure, public health, public safety, and/or public order;
4. To support people who are faced with actions that harm their constitutional and private
property rights, health, and/or safety, including charitable contributions toward legal fees; and
5. To exercise all powers granted by law necessary and proper to carry out the foregoing
purposes including, but not limited to, the power to accept donations of money, time, services,
property (whether real or personal), and any other thing of value. Nothing herein shall be
deemed to authorize or permit the Corporation to carry on any business for profit, to exercise any
power, or to do any act that a Corporation formed under the Act, or any amendment thereto or
substitute therefore, may not at that time lawfully carry on or do.

ARTICLE VI: Limitations
No part of the net earnings or the assets of the Corporation shall inure, or be to the benefit of its
members, officers, Directors, or other private persons except that the Corporation shall be
authorized to pay reasonable compensation for services rendered and to make payments and
distributions in furtherance of the purposes set forth in Article VI hereof. No substantial part of
the activities of the Corporation shall be for the carrying on of propaganda or otherwise
attempting to influence legislation, and the Corporation shall not participate in (or intervene in),
including the publishing or distribution of statements about, any political campaign on behalf of
any candidate for public office. Notwithstanding any other provision of these Articles, the
Corporation shall not carry on any other activities not permitted to be carried out by a
corporation exempt from federal taxation under Section 501(c)(3) of the Internal Revenue Code
of 1986, as amended from time to time.

ARTICLE VII: Members
1. The Corporation shall have only non-voting members.
2. Any natural person residing in the United States may become a member of the
Corporation upon payment of annual membership dues fixed by the Board of Directors. A
person “residing in” the United States is defined as one whose principle residence is located in
any U.S. state or territory.
Citizens Allied for Integrity and Accountability, Inc. Page 3 of 4
Articles of Incorporation
3. Only natural persons may be members of the organization. No group, organization,
business entity, or corporation shall be a member of the Organization.
4. Membership classes: There shall be no membership classes except as the Board of
Directors may establish at their discretion.

ARTICLE VIII: Board of Directors
1. The affairs of the Corporation shall be Managed by its Board of Directors.
2. The number of Directors serving on the Board shall be set fixed in accordance with the
Corporation’s Bylaws.
3. Qualifications: Each Director of the Corporation shall, at all times, be a member of the
Corporation.
4. Other than the Directors constituting the Initial Board of Directors, who are designated
in these Articles, the Directors shall be elected or appointed by the existing members of the
Board of Directors in the manner and for the term provided in the Bylaws of the Corporation.
5. The names and addresses of the persons constituting the Initial Board of Directors are:

Name Address
1. Shelley Brock 8770 Chaparral Rd., Eagle, ID 83616
2. Alma Hasse 2945 1st Lane E., Parma, ID 83660
3. James Plucinski 2945 1st Lane E., Parma, ID 83660
4. Joseph Weatherby 3624 S. Midland Blvd., Nampa, ID 83686
5. Pattie Young 3784 Sand Hollow Rd., New Plymouth, ID 83655

ARTICLE IX: Membership Dues
Membership dues may be charged to all members or classes of members in equal amounts or in
different amounts or proportions upon different members or different classes of membership.
The Board of Directors is authorized to fix the amount of membership dues from time to time,
and to make them payable at such times or intervals, and upon such notice, and by such methods
as the Board of Directors may prescribe.

Citizens Allied for Integrity and Accountability, Inc. Page 4 of 4
Articles of Incorporation
ARTICLE X: Distribution and Dissolution
Upon dissolution of the Corporation, the Board of Directors shall, after paying or making
provision for the payment of all liabilities of the Corporation, distribute all assets of the
Corporation consistent with the purposes of the Corporation to such organization or
organizations as shall at that time qualify as exempt organizations under Section 501(c)(3) of the
Internal Revenue Code of 1986, as amended from time to time, in such manner as the Board of
Directors shall determine. Any such assets not so distributed shall be distributed by the district
court of the county in which the principle office of the Corporation is then located, exclusively
for the purposes of or to such organizations, as such court shall determine to be consistent with
the purposes of the Corporation.

Article XI: Incorporator
The name and address of the Incorporator is: Alma Hasse, 2945 1st Lane E., Parma, ID 83660.

Article XII: Bylaws
Provisions for the regulation of the internal affairs of the Corporation shall be set forth in the
Bylaws. The Board of Directors of the Corporation shall be authorized to amend the
Corporation’s Bylaws at a properly noticed special or regular meeting of the Board of Directors.

Certification
I certify that I have read the above Articles of Incorporation and that they are true and correct to
the best of my knowledge.

___________________________
Alma Hasse, Incorporator

Citizens Allied for Integrity and Accountability, Inc.
BYLAWS
(November 29, 2015)

ARTICLE ONE: ORGANIZATIONAL OFFICE

The principal office of the corporation (“Citizens Allied for Integrity and Accountability,
Inc.” or “C.A.I.A.”) shall be located at Parma, Payette County, State of Idaho.

ARTICLE TWO: BOARD OF DIRECTORS

SECTION 1: General Powers and Duties – By law, the affairs of the corporation shall
be managed by its Board of Directors. There are no voting members of this corporation.
The Directors may decide amongst themselves which of them shall be appointed
to the positions of the three required officers of the corporation: President, Secretary,
and Treasurer; or the Directors may decide to appoint other persons to the posts of
Secretary and/or Treasurer, as needs warrant (see Article Three, OFFICERS).
The Director assigned to serve as President of the organization shall also serve
as the President of the Board of Directors and shall preside at meetings of the Board of
Directors. The Director assigned to serve as Secretary of the organization shall serve
as secretary for the Board; or, if another person is appointed Secretary of the
organization, that person shall serve as secretary for the Board.
All Directors shall be active in the pursuit of the organization's goals. They shall
ensure that the corporation maintains directors’/officers’/agents’ liability insurance.
They shall ensure that the corporation achieves and maintains nonprofit status. They
shall maintain and adhere to organizational guidelines and see that any other volunteers
or agents for the organization do the same.
The Board of Directors shall set up and oversee a voluntary supportive
membership organization as part of its efforts in growing and sustaining interest in and
support for C.A.I.A. and its works (see Article Four, Section 1, “Supportive Members”).
Members of such an organization shall not be considered “members” of the corporation
and shall have no voting power.

SECTION 2: Number, Tenure, and Qualifications – The number of Directors shall be
five at inception of the organization. The Board reserves the right to add members to or
subtract from the number on the Board so long as the number of Directors is at least
three.
The normal term of office of each Director shall be three years. To provide
continuity, the terms of office will be staggered; the method of ensuring this shall be
determined by the Directors. Directors may serve any number of successive terms.
The Board shall determine how to re-appoint Directors who are willing to continue
serving after their terms expire.
After inception of the organization, persons interested in becoming Directors
when a Board position is open shall submit to the Board a letter of interest stating
his/her related experience, interests, and skills and shall disclose any potential conflicts
of interest with C.A.I.A.’s goals and activities. Such persons shall be fully informed of
the purposes and Bylaws/Articles of the organization and shall also agree to abide by

2
the CAIA Mission Statement/Core Values and Team Guidelines, and sign a prepared
statement declaring that they have no conflict of interest with the work C.A.I.A. is
engaged in, prior to appointment.
All Directors shall also be C.A.I.A. Supportive Members.

SECTION 3: Appointment of Directors – Vacant positions on the Board of Directors
(including those resulting from an increase to the number of positions) shall be filled by
appointment by the Board of Directors. A Director appointed to fill an unexpected
vacancy shall serve for the unexpired term of her/his predecessor in that position.

SECTION 4: Resignation of Directors, and Vacancies – A Director may resign at
any time by delivering written notice to the Board President or Secretary. A resignation
is effective when the notice is effective, unless the notice specifies a later effective date
(in which case the new Director may be named prior to the date). A vacancy will be
filled at the earliest convenience of the remaining Directors.

SECTION 5: Meetings of Directors, and Notice – Meetings of the Directors may be
held at any convenient location agreed upon, or they may be held wholly or partially via
conference call or other electronic means whereby all participants may hear each other
or their comments be quickly shared with all.

A) Regular Meetings of Directors: One regular meeting of the Board of
Directors shall be held annually in January at the conclusion of the organization's
fiscal year. The Board will set the time and place of the meeting at a prior special
meeting of Directors.
The Board of Directors may provide for the time and place for holding
additional regular meetings of Directors without further notice. Such meetings
may be attended by other Working Group members from time to time.

B) Special Meetings of Directors: Special meetings of the Board of Directors
may be called at the request of any Director. A minimum of two days' advance
notice of the special meeting shall be given to the other Directors, unless the
Directors agree to meet without notice according to Idaho Statute 30-30-615(2).

SECTION 6: Quorum and Voting of Directors – Two of the Directors, or one-third of
the Board membership if it is more than six, shall constitute a quorum for the transaction
of business at any meeting of the Board. Every effort will be made to include all
Directors at any regular or special board meeting, including via conference call.
All voting (except for removal of a Director – see Section 9 below; for a motion to
mortgage the organization's property – see Article 5, Section 2; and for amendment or
Articles of Incorporation or Bylaws – see Article 8) shall be decided by a simple majority
of those Directors voting.

SECTION 7: Action by Directors without Meeting – Any action that may be taken at
a meeting of the Board of Directors may be taken without a meeting if a consent in
writing, setting forth the action, is signed by all of the current Directors. Evidence of
such an action shall be filed with the minutes of the organization kept by the Secretary.

3
SECTION 8: Compensation – Directors shall not receive any remuneration for their
services on the Board. This does not preclude a Director from receiving reasonable
payment for any goods or services offered to and authorized by the organization.

SECTION 9: Removal – Any Director may be removed by act of the Board via a two-
thirds vote of all current Directors, at a special meeting only.

ARTICLE THREE: OFFICERS

SECTION 1: Organizational Officers – The required officers of the corporation shall
be a President, a Secretary, and a Treasurer. Other officers (such as one or more vice-
presidents, or assistant treasurers or secretaries) may be appointed by the Board of
Directors as needed, to act from time to time. The three required officers, as well as
supplementary officers, may also serve in the capacity of Directors of the corporation.
The President and the Secretary shall not be the same person; otherwise, the same
person may hold two officer positions.

SECTION 2: Powers, Duties, and Qualifications of the Officers – All officers shall
be approved and appointed by the Directors of the corporation. All officers will be given
the CAIA Mission Statement/Core Values and Team Guidelines and agree to abide by
them, and will sign a prepared statement declaring that they have no conflict of interest
with the work C.A.I.A. is engaged in, prior to appointment.
The duties of the three required officers are as stated below. The duties of any
supplementary officers shall be determined at the time of their assignment, and access
to any records needed to fill in for their counterparts will be given them as appropriate.

A) President: The President (who also serves as President of the Board of
Directors) shall prepare agendas for Board meetings, shall preside at these
meetings, and shall give a state-of-the-corporation report at each annual Board
meeting. S/he shall be responsible for reminding the group of Articles and
Bylaws that are pertinent to the discussion, and shall attempt to elicit input from
all members present on important topics under discussion, so that all relevant
information and points of view are considered before any matter comes to a vote.

B) Secretary: The Secretary (who will serve as Secretary on the Board of
Directors) shall prepare and keep minutes of all meetings of the Board and shall
keep up to date a list of the corporation’s directors, officers, and other agents,
advisors, and helpers. The Secretary shall be responsible for preparing and
sending letters from the organization as requested, for revising the Articles and
Bylaws as needed, and for delivering copies of Articles, Bylaws, CAIA Team
Guidelines, and other helpful CAIA documents to new Board members and
officers.

C) Treasurer: The Treasurer (who may be a member of the Board of Directors)
is responsible for sending the annual report of the corporation to the Secretary of

4
State. Unless the Directors assign these tasks to one or more assistants, the
Treasurer also handles the corporation’s checkbook; keeps other banking,
financial, and insurance records; makes deposits of monies received by the
corporation; pays bills due to the corporation; and gives reports to the Directors
at the annual meetings, and as requested, of the corporation’s financial standing
and of the results of its specific fundraising efforts. The Treasurer (or a delegate)
also is responsible for cash needed as seed money for, and raised as a result of,
any fundraising activity of the organization.

SECTION 3: Appointment and Term of Office – The required officers of the
corporation shall be appointed by the Board of Directors, for a term of two years. If a
vacancy occurs prior to this time, it shall be filled for the unexpired portion of the term of
office. To provide continuity, the normal terms of office of the Secretary and the
Treasurer will be staggered; the method of ensuring this shall be determined by the
Directors. Officers may serve any number of successive terms.
Supplementary officers may be appointed from time to time for such terms as the
Directors choose to assign.

SECTION 4: Resignation, and Vacancies – An officer may resign at any time by
delivering written notice to the Board President or Secretary. A resignation is effective
when the notice is effective, unless the notice specifies a later effective date. A vacancy
will be filled at the earliest convenience of the Board of Directors, and an interim acting
officer may be appointed at the Board’s discretion.

SECTION 5: Removal – Any officer appointed by the Board of Directors may be
removed by the Board of Directors, by majority vote of all Directors, whenever in their
judgement the best interests of the corporation would be served thereby. (This action
would not necessarily affect the position on the Board of a Director who is also serving
as an officer – though in the case of the President, it would entail a shifting of the
positions held by the Board.)

ARTICLE FOUR: SUPPORTIVE MEMBERS, VOLUNTEERS, AND
ADVISORS

SECTION 1: Supportive Members – C.A.I.A. non-voting Supportive Members will pay
a yearly membership fee established by the Board of Directors. They will receive
newsletters to keep them apprised of information about the organization’s pursuits.
Unaffiliated people will be welcome at informational meetings. They may also
attend Working Group meetings by invitation; but anyone wishing to participate regularly
in Working Group meetings involving organizational planning, or to be privy to
organizational records, to handle monies for the organization, to act as an ambassador
for the organization, or to serve on the Board of Directors, the Advisory Board, or as an
officer, must become a C.A.I.A. Supportive Member.

5
SECTION 2: Volunteers – Volunteers unaffiliated with C.A.I.A. may be used from
time to time for purposes not involving them in proprietary information about the
organization.
Volunteers whose services may involve access to any organizational records will
be approved as known and trustworthy by at least one Board member and will become
C.A.I.A. Supportive Members prior to their first working assignment. All such Volunteers
will abide by the CAIA Mission Statement/Core Values and Team Guidelines and will be
asked to sign a prepared statement declaring that they have no conflict of interest with
the work C.A.I.A. is engaged in.

SECTION 3: Working Group Members – Working Group members are C.A.I.A.
Supportive Members who have been fully vetted by the Board of Directors and have
agreed to abide by C.A.I.A.’s Mission Statement/Core Values and Team Guidelines.
They may sit in on Board/decision-making meetings and have access to sensitive
information. Working Group members will be asked to sign a prepared statement
declaring that they have no conflict of interest with the work C.A.I.A. is engaged in.

SECTION 4: Advisory Board – The Board of Directors also reserves the right to set
up an official Advisory Board, which may consist of persons who are consulted
individually or collectively for their expertise in matters of ongoing interest to the Board
of Directors. Advisory Board members shall also be C.A.I.A. Supportive Members and
sign a prepared statement declaring that they have no conflict of interest with the work
C.A.I.A. is engaged in.
Those on such an Advisory Board may be publicized as such, at the discretion of
the Board of Directors.

ARTICLE FIVE: SALES, CONTRACTS, CHECKS, DEPOSITS, AND GIFTS

SECTION 1: Sales – The Board of Directors shall have the right to authorize the sale
of services, or of items either donated or purchased, as part of its fundraising and
outreach efforts on behalf of C.A.I.A. It is also authorized to sell any donated,
bequeathed, or devised property deemed superfluous to its needs.

SECTION 2: Contracts – The Board of Directors may authorize any officer/s or agent/s
of the corporation to enter into any contract with a value over $500, or execute and
deliver any instrument, in the name of and on behalf of the corporation, and such
authority may be general or may be confined to specific instances. Such contracts must
be signed by the President and either the Secretary or the Treasurer of the
organization.
This power shall include the right to lease or mortgage any portion of the
corporation's property. At least a two-thirds majority of all current Directors is required
to approve an action of mortgaging property.

SECTION 3: Checks, Drafts, or Orders – All checks, drafts, or orders for payment of
money, notes, or other evidences of indebtedness issued in the name of the corporation

6
shall be signed by the Treasurer or Assistant Treasurer, any Board member, or a
Board-authorized designee.

SECTION 4: Deposits – All funds of the corporation shall be deposited to the credit of
the corporation in such banks, trust companies, or other depositories as the Board of
Directors may select. Any member of the Board, the Treasurer, an Assistant Treasurer,
or a Board-authorized designee may make such deposits.

SECTION 5: Gifts – The Board of Directors may accept on behalf of the corporation
any contribution, gift, bequest, or devise for any purpose of the corporation.

ARTICLE SIX: BOOKS AND RECORDS

The corporation shall keep correct and complete books and records of account and
shall also keep minutes of the proceedings of its Board of Directors and any committee
exercising the delegated authority of the Board of Directors. The corporation shall keep
at its principal office these and all other official records (except the Treasurer’s current
account books and the Secretary’s current minutes/ correspondence), including a
record giving the names and addresses of the current Directors, officers, and agents.
All books and records of the corporation may be inspected by any Director or officer, or
his agent or attorney, for any proper purpose at any reasonable time.

ARTICLE SEVEN: FISCAL YEAR

The fiscal year of the corporation shall be from January 1st through December 31st.

ARTICLE EIGHT: AMENDMENT OF ARTICLES AND BYLAWS

The Articles or Bylaws of the corporation may be altered, amended, or repealed, and
new Articles or Bylaws adopted, by an affirmative vote of two-thirds of all current
Directors, at any regular or special meeting. A minimum of seven days’ notice must be
given to the membership of the Board, a copy or summary of the proposed
amendments provided to all Board members, and a discussion on the proposed
changes must take place, either in a meeting at which a quorum of Directors is present
or in written format.
Any time that a C.A.I.A. bylaw or article is amended, the Secretary or a designee
shall produce revised documents for the records of the organization, and copies of
pertinent pages for its Directors and officers.
CAIA
 Mission
 Statement

(revised
 on
 1/6/17)

CAIA
 is
 non-­‐partisan,
 dedicated
 to
 representing
 and
 educating
 the

public
 and
 participating
 in
 public
 processes
 to
 promote
 the
 preservation

of
 private
 property
 rights,
 public
 health,
 safety,
 and
 resources.

CAIA
 Core
 Values

(approved
 on
 11/22/15)

CAIA
 and
 its
 members
 ground
 internal
 and
 external
 goals,
 processes,
 and
 actions
 in

these
 core
 values:

1. Respect:

 Civility,
 Courtesy,
 Honor,
 Decency,
 Dignity,
 Autonomy,
 Tolerance,

Acceptance

2. Responsibility:

 Accountability,
 Integrity,
 Follow-­‐Through,
 Pursuit
 of

Excellence,
 Self-­‐Restraint,
 Personal
 Growth,
 Humility,
 Service,
 Constructive

Optimism

3. Trustworthiness:

 Honesty,
 Truthfulness,
 Sincerity,
 Candor,
 Loyalty,

Accuracy

4. Caring:

 Appreciation
 of
 Others,
 Self
 After
 Others,
 Love
 for

People/Humanity/Life,
 Giving
 Without
 the
 Expectation
 of
 Return

5. Fairness:

 Inclusiveness,
 Equity,
 Impartiality,
 Nonpartisan,

Nondiscriminatory

6. Citizenship:

 Aware
 and
 Informed,
 Engaged,
 Do
 More
 Than
 Your
 Fair
 Share,

Work
 for
 Community
 Wellbeing,
 Active
 Oversight
 of
 Elected
 Leaders
 to

Ensure
 Genuine
 Representation

[1-­‐6-­‐2017_SG]

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 2: Please provide the names and business addresses of the officers and directors
of CAIA, indicate whether these persons are customers of Eagle Water Company, and indicate which
schedule or tariff under which they take service.
Response: Board of Directors: Shelley Brock, 8770 W. Chaparral Rd., Eagle, 83616
Julie Fugate, 1861 NW 24th St., Fruitland, ID 83619
Elizabeth Roberts, 1351 N. Mansfield Pl., Eagle, ID 83616
Lee Turner, 1399 W. Newfield Dr., Eagle, ID 83616

Officers: President - Shelley Brock, see above
Secretary - Sherry Gordon, PO Box 1091, Emmett, ID 83617
Treasurer - Elizabeth Roberts, see above

None of CAIA’s officers or directors are customers of Eagle Water Company.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 3: Please describe the process by which a person or entity is admitted to
membership in CAIA.
Response: Anyone with a passion for community justice and serving the public interest
by working to preserve private property rights, public health, safety and resources as outlined in
our mission statement may join CAIA by paying an annual membership fee, either directly or
online. There is no requirement to disclose personal information.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 4: Please state the total number of persons or entities who are members of
CAIA. Please indicate whether each member is a current customer of Eagle Water Company and, if
so, under which schedule or tariff they take service.
Response: CAIA currently has 89 members. Approximately 30 of those are believed to
live in the City of Eagle and while a number are Eagle Water Co. residential and/or commercial
customers, we have no way of knowing precisely how many, nor which schedule or tariff
governs their service since we do not require physical addresses of our members.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 5: Please state the number of CAIA members that also are members of
another intervenor in this proceeding. For each, please identify which other intervenor the CAIA
member is also a member of.
Response: Because CAIA has no way of knowing who all the members of the other
intervenors are it is not possible for us to answer this request completely. Several CAIA
members are known to also be members of intervenor Eagle Water Customer Group (EWCG).
Some CAIA members live in Boise which is also an intervenor in this case. Some CAIA
members are residents of Eagle City, another intervenor in this case.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 6: Please describe the source of funds by which the activities of CAIA are
supported.
Response: CAIA’s sole financial support to date has been individual, private donations.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 7: Please describe, in detail, the factual basis for CAIA's statement in its
Petition to Intervene that CAIA's participation in this case will further its interest "maintaining high
quality water resources." Please provide any and all relevant analyses, studies, or other documents
supporting your answer.
Response: CAIA advocates for the preservation of Eagle Water Co.’s (“EWC’s”) high
quality water which has served EWC customers for decades without the mixing of surface water
and addition of potentially harmful levels of chlorination as Suez proposes doing if they acquire
this system. History shows that maintaining local control of water resources tends to encourage
maintenance of water quality. Larger water systems, such as those currently operated by Suez,
tend to sacrifice water quality for uniformity, and to achieve cost savings. The effect of such
actions is to shift costs onto consumers/rate payers either directly or indirectly. By supporting
the existing water system and opposing a full, operational integration into the larger, Suez-
operated water system, CAIA would further its interest in maintaining high quality water
resources for the customers of EWC.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 8: Please describe, in detail, the factual basis for CAIA's statement in its
Petition to Intervene that CAIA's participation in this case will further its interest "maintaining local
control" of water. Please provide any and all relevant analyses, studies, or other documents supporting your
answer.
Response: CAIA has been a leading voice in advocating for local control of critical
community resources like the water we drink, farm with and recreate in, the air we breathe and
the soil that grows our food here in Idaho. As potable water resources shrink due to erratic
climate changes and unprecedented levels of industrial contamination both globally and in the
Gem State, water is becoming an increasingly scarce and precious commodity. Likewise,
growth in both residential and commercial demand for water in the Treasure Valley will put
additional strain on existing water resources, and has already resulted in significant calls for the
development of additional water capture and storage projects on area rivers. Allowing a
multinational, for-profit entity to exercise full control over a precious, irreplaceable resource is
not in the best interest of the public. By intervening in this action, CAIA hopes to ensure that
whatever entity ends up providing water to the current customers of Eagle Water Company will
maintain a high level of accountability to the local community. At present, EWC is a local
company, employing local workers for nearly all of its functions. Operations are conducted
from an office in the City of Eagle. If Suez proceeds with its intended purchase, CAIA hopes to
ensure that equally responsive and accountable structures are implemented so that EWC
customers are assured the same level of local accountability, local production, and local
expenditures.

In reaching its conclusions on this issue, CAIA has relied, in part on articles and analyses
produced herewith.
×Power the ghts that protect our food, water, andclimate!
MAKE YOUR GIFT
Water Privatization: Facts and Figures
Privatizing local water and sewer systems usually does far more
harm than good for our communities.
08.31.15
Water privatization – when private corporations buy or operate public water utilities – is
often suggested as a solution to municipal budget problems and aging water systems.
Unfortunately, this more often backres, leaving communities with higher rates, worse
service, job losses, and more.
Problems with Water and Sewer Privatization
Loss of Control
Privatization is irresponsible. By privatizing water and sewer systems, local
government ocials abdicate control over a vital public resource.
Privatization limits public accountability. Multinational water corporations are
primarily accountable to their stockholders, not to the people they serve.
Loss of public input. Because water service is a natural monopoly that lacks a
true market, consumers can exercise choice only at the ballot box through the
election of the public ocials who oversee their utility. They don’t have a vote
in the corporate boardroom. With public ownership, residents can visit their
elected ocials and directly express their opinions about the operation of
their water systems. If the ocials fail to respond, the community can vote
them out of oce. The public lacks similar mechanisms to address their
concerns with private utilities and appointed state regulators, and long-term
complex contracts can tie the hands of local governments.
Loss of transparency. Private operators usually restrict public access to
information and do not have the same level of openness as the public sector.
The objectives of a prot-extracting water company can conict with the
public interest. Because a water corporation has dierent goals than a city does, it
will make its decisions using a dierent set of criteria, often one that emphasizes
protability. This can create conict.
Cherry picking service areas. Private water companies are unlikely to adopt
the same criteria as municipalities when deciding where to extend services.
They are prone to cherry-picking service areas to avoid serving low-income
communities where low water use and frequent bill collection problems could
hurt corporate prots.
Contributing to sprawl. Local governments can use the provision of water
and sewer services to promote smart growth, while water companies often
partner with private developers to supply service to sprawling suburbs.
Undermining the human right to water. As a result of price hikes, service
disconnections, inadequate investment and other detrimental economic
consequences, water privatization often interferes with the human right to
water. Read the issue brief: Water Equals Life: How Privatization Undermines
the Human Right to Water 
Rate Increases 
Investor owned utilities typically charge 59 percent more for water service
than local government utilities. Food & Water Watch compiled the water rates of
the 500 largest community water systems in the country and found that private,
for-prot companies charged households an average of $501 a year for 60,000
gallons of water — $185 more than what local governments charged for the same
amount of water.
Investor owned utilities typically charge 63 percent more for sewer service
than local government utilities. Food & Water Watch compiled sewer rates
survey data from dozens of states and found that private ownership increased
sewer bills by 7 percent in West Virginia to 154 percent in Texas.
After privatization, water rates increase at about three times the rate of
ination, with an average increase of 18 percent every other year. Food &
Water Watch examined how water prices changed under private ownership
following the 10 largest known sales of municipal water or sewer system to for-
prot companies between 1990 and 2010. As of 2011, after an average of 11 years
of private control, residential water rates had nearly tripled on average, increasing
a typical household’s annual bill by more than $300. 
Higher Operating Costs
Private operation is not more ecient. Empirical evidence indicates that there is
no signicant dierence in eciency between public and private water provision.
Lack of competition. In theory, competition would lead to cheaper contracts,
but in practice, researchers have found that the water market is “rarely
competitive.” The only competition that can exist is the competition for the
contract, and there are only a few private water companies that bid to take
over municipal water systems. Once a contract is awarded, the winning
company enjoys a monopoly. A lack of competition can lead to excess prots
and corruption in private operations.
Privatization often increases costs. Corporate prots, 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. Read the fact sheet: Public-Private Partnerships: Issues and Diculties
with Private Water Service
Public operation often saves money. 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. Read the fact
sheet: The Public Works: How the Remunicipalization of Water Services Saves
Money
Other Costs
Privatization contracts can be expensive to implement. The privatization
process is complicated, expensive and time-consuming. In total, contract
monitoring and administration, conversion of the workforce, unplanned work, and
use of public equipment and facilities can increase the price of a contract by as
much as 25 percent. Other hidden expenses, including change orders and cost
overruns, can further inate the price of private service.
Privatization can increase the cost of nancing a water project by 50 percent
to 150 percent. Local governments usually use municipal bonds to nance water
projects; these bonds have an average interest rate of about 4 percent. Private
water companies use a mix of equity and corporate debt with a weighted average
cost that ranges from 7.5 percent to 14 percent or higher. So, in total, over 30
years, private nancing is nearly 1.5 to 2.5 times as expensive as public nancing,
adding $0.8 million to $2.5 million onto the total cost of every $1 million
investment. 
Service Problems
Privatization can worsen service. There is ample evidence that maintenance
backlogs, wasted water, sewage spills and worse 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 cut corners. When private operators attempt to cut costs,
practices they employ could result in worse service quality. They may use shoddy
construction materials, delay needed maintenance or downsize the workforce,
which impairs customer service and slows responses to emergencies.
Privatization typically leads to a loss of one in three water jobs. A survey of 10
privatization contracts found that after taking over a system, water companies
reduce the workforce by 34 percent on average. Other surveys have found similar
results.  With fewer employees to make repairs and respond to customer service
requests, it is not surprising that service quality often suers. 
Privatization can allow systems to deteriorate. Such neglect can hasten
equipment breakdowns and allow water system assets to deteriorate. Because 70
to 80 percent of water and sewer assets are underground, a municipality cannot
easily monitor a contractor’s performance. 
What role should the private sector play?
From developing new technologies to providing construction crews for new treatment
plants, the private sector plays an important role in protecting our water resources and
nding innovative solutions to the water crisis. Although the public and private sectors
work well together in many areas, businesses should not operate, manage or own
public drinking water or wastewater systems. Those duties should fall under the
purview of local governments, who have a responsibility to ensure safe and aordable
service for all.
Solutions: Improving our Water and Sewer Infrastructure
Public-Public Partnerships
Instead of privatizing water systems, municipalities can partner together through public-
public partnerships. Public partners are more responsive, reliable and cost-eective
than private water companies. Intermunicipal cooperation, interlocal agreements and
bulk purchasing consortiums can improve public services and reduce costs, while
allowing communities to retain local control.
Clean Water Trust Fund
We need to plan ahead and create a dedicated source of public funding that will help
public utilities protect our country’s valuable water resources. A national water trust
fund can achieve this feat and ensure the safe and sound operation of our water and
sewer systems. With a renewed federal commitment, our nation’s good public operators
can keep our water safe, clean and aordable.
Take Action: Sign our petition to support the WATER Act and fund aordable, public
water for all Americans
Food & Water Watch champions healthy food and clean water for all. We stand up to corporations that put
prots before people, and advocate for a democracy that improves people’s lives and protects our
environment.
Food & Water Watch is a 501(c)3 non-prot organization.
Food & Water Action is a 501(c)4 organization.
Food & Water Watch Headquarters
1616 P Street, NW,
Washington, DC 20036
Main: 202.683.2500
Contact your regional oce.
Work with us: See all job openings
Learn more about Food & Water Action www.foodandwateraction.org.
%ULHILQJ3DSHU
3XEOLF3ULYDWH3DUWQHUVKLSV
,VVXHVDQG'LIILFXOWLHVZLWK3ULYDWH:DWHU6HUYLFH
3VJHSNV]LYUTLU[Z^PSSUV[ZVS]L[OLPY^H[LY
PUMYHZ[Y\J[\YLWYVISLTZI`WYP]H[PaPUN[OLPY^H[LY
Z`Z[LTZ[OYV\NOW\ISPJWYP]H[LWHY[ULYZOPWZ(S
[OV\NOZVTLPUK\Z[Y`HUKNV]LYUTLU[VMÄJPHSZ
JSHPT[OH[[OLZLKLHSZ^PSSOLSWPTWYV]L^H[LY
WYV]PZPVUHYL]PL^VM[OLSP[LYH[\YLYL]LHSZ[OH[
[OLZLHYYHUNLTLU[ZHYL\USPRLS`[VOLSWT\UPJP
WHSP[PLZÄUHUJL^H[LYPTWYV]LTLU[WYVQLJ[ZVY
JVU[YVSJVZ[Z7\ISPJWYP]H[LWHY[ULYZOPWZVM[LU
PUJYLHZLJVZ[Z^VYZLUZLY]PJLX\HSP[`HUKHS
SV^PUMYHZ[Y\J[\YLHZZL[Z[VKL[LYPVYH[L;OL`HYL
HUPTWYHJ[PJHSHS[LYUH[P]L[V[YHKP[PVUHSW\ISPJ
^H[LYWYV]PZPVU
(Z[\K`VMSVJHSW\ISPJZLY]PJLKLSP]LY`PUTVYL
[OHUH[OV\ZHUK<:T\UPJPWHSP[PLZMV\UK[OH[
MYVT [V[^PJLHZTHU`T\UPJPWHSP
[PLZLUKLKWYP]H[PaH[PVUJVU[YHJ[ZHUKILNHU
W\ISPJVWLYH[PVUVM^H[LYZ`Z[LTZHZWYP]H[PaLK
[OLPY^H[LYKPZ[YPI\[PVUZ`Z[LTZ;OLYLZLHYJOLYZ
L_WSHPULK¸;OPZZ\NNLZ[Z[OH[HSHYNLWYVWVY[PVU
VMT\UPJPWHSP[PLZL_WLYPTLU[LK^P[OWYP]H[PaH
[PVUHUKMV\UK[OLYLZ\S[Z\UZH[PZMHJ[VY`¹
^^^MVVKHUK^H[LY^H[JOVYN‹7:[5>>HZOPUN[VU+*‹PUMV'M^^H[JOVYN
3XEOLF3ULYDWH3DUWQHUVKLSV,VVXHVDQG'LI¿FXOWLHVZLWK3ULYDWH:DWHU6HUYLFH
+LÄUPUNW\ISPJWYP]H[LWHY[ULYZOPWZMVY
^H[LYZLY]PJL
0U[OL^H[LYZLJ[VYHW\ISPJWYP]H[LWHY[ULYZOPWPZH[`WLVM
WYP]H[PaH[PVU^OLYLPUHSVJHSNV]LYUTLU[JVU[YHJ[Z^P[OH
WYP]H[LLU[P[`[VY\UHSSVYWHY[VMHNV]LYUTLU[V^ULKKYPUR
PUN^H[LYVY^HZ[L^H[LYZ`Z[LT;OLZLHYYHUNLTLU[ZJHU[HRL
HU\TILYVMMVYTZ^P[O]HY`PUNKLNYLLZVMWYP]H[LPU]VS]L
TLU[;OL`JHUPU]VS]LUL^VYL_PZ[PUNPUMYHZ[Y\J[\YLHUK
JHUYHUNLPUZJHSLMYVTHZPUNSL[YLH[TLU[WSHU[[VHULU[PYL
^H[LYVY^HZ[L^H[LYZ`Z[LT0UNLULYHS[OLSVUNLY[OLJVU
[YHJ[HUK[OLIYVHKLYP[ZZJVWL[OLTVYLJVU[YVSHNV]LYU
TLU[[YHUZMLYZ[V[OLWYP]H[LLU[P[`
0U[OL<UP[LK:[H[LZHJVTTVUW\ISPJWYP]H[LWHY[ULYZOPW
PZHUVWLYH[PVUZHUKTHPU[LUHUJLJVU[YHJ[^P[OH[^V[V
Ä]L`LHY[LYT3LZZMYLX\LU[S`HW\ISPJWYP]H[LWHY[ULY
ZOPWPU]VS]LZ[OLJVUZ[Y\J[PVUVMH^H[LY[YLH[TLU[WSHU[0U
[OLZLJHZLZHWYP]H[LLU[P[`KLZPNUZHUKI\PSKZHMHJPSP[`HUK
[OLUY\UZP[MVYHZL[WLYPVK\Z\HSS`[V`LHYZ0UTVZ[
JHZLZ[OLSVJHSNV]LYUTLU[YL[HPUZYLZWVUZPIPSP[`MVYJHWP[HS
WYVQLJ[Z
7\ISPJWYP]H[LWHY[ULYZOPWZHYLUV[H
ÄUHUJPUNZVS\[PVU
7YP]H[LÄUHUJPUNPZYHYLPU^H[LYYLSH[LKW\ISPJWYP]H[L
WHY[ULYZOPWZILJH\ZLVM[OLWYP]H[LZLJ[VY»ZOPNOLYJHWP[HS
JVZ[Z7\ISPJ\[PSP[PLZÄUHUJLWYVQLJ[Z^P[OT\UPJPWHSIVUKZ
^OPJOHYLNLULYHSS`SLZZL_WLUZP]L[OHUWYP]H[LJHWP[HS0U
[OL<UP[LK:[H[LZT\UPJPWHSIVUKZOH]LHUH]LYHNLPU[LYLZ[
YH[LVMWLYJLU[^OPSLHWYP]H[L^H[LY\[PSP[`»ZÄUHUJPUN
[`WPJHSS`JVZ[ZHWWYV_PTH[LS`WLYJLU[)HZLKVU[OLZL
ÄN\YLZ\ZPUNWYP]H[LÄUHUJPUNPUZ[LHKVMW\ISPJÄUHUJPUN
^V\SKPUJYLHZL[OLJVZ[VMHTPSSPVU^H[LYWYVQLJ[I`
 TPSSPVUV]LY`LHYZ
0U[OL<UP[LK:[H[LZT\UPJPWHSP[PLZ\Z\HSS`^HU[[V\ZLSV^
JVZ[[H_L_LTW[T\UPJPWHSIVUKZ[VÄUHUJL^H[LYYLSH[LK
WYVQLJ[ZZV[OL`Z[Y\J[\YLW\ISPJWYP]H[LWHY[ULYZOPWZPU
HJJVYKHUJL^P[OZWLJPÄJ[H_Y\SLZ[OH[YLZ[YPJ[JVU[YHJ[[LYTZ
[V`LHYZ-VY[OH[YLHZVUJVU[YHJ[[LYTZYHYLS`L_JLLK
`LHYZ
3VUN[LYT^H[LYJVU[YHJ[Z[OH[PUJS\KLWYP]H[LÄUHUJPUN
^OPSL\UJVTTVUHYLTVYLMYLX\LU[V\[ZPKL[OL<UP[LK
:[H[LZI\[[OLPU[LYUH[PVUHSL_WLYPLUJLZ\NNLZ[Z[OH[W\ISPJ
WYP]H[LWHY[ULYZOPWZHYL\UYLSPHISL;OLWYP]H[LTHUHNLYZVM
[LUMHPS[VTHRLULLKLKJHWP[HSPTWYV]LTLU[Z-VYL_HTWSL
UVULVM[OLÄ]LJVUJLZZPVUZPUZ\I:HOHYHU(MYPJHKLSP]LYLK
[OLWYVTPZLKSL]LSVMPU]LZ[TLU[
,_HTWSLZVM7\ISPJ7YP]H[L
7HY[ULYZOPWZ
*VU[YHJ[;`WL ;`WPJHS
;LYT
(SSVJH[PVUVM9LZWVUZPIPSP[PLZ
6WLYH[PVUZHUKTHPU[LUHUJL6
4
[V`LHYZ (JVTWHU`Y\UZHUKTHPU[HPUZ
HSSVYWHY[VMH\[PSP[`;OLSVJHS
NV]LYUTLU[V^UZHUKTHUHNLZP[
HUKÄUHUJLZPTWYV]LTLU[WYVQLJ[Z
4HUHNLTLU[`LHYZ (JVTWHU`Y\UZHUKV]LYZLLZ[OL
VWLYH[PVUVMHWSHU[VYKPZ[YPI\[PVU
Z`Z[LTHUK[OLSVJHSNV]LYUTLU[
V^UZ[OLZ`Z[LTHUKÄUHUJLZ
PTWYV]LTLU[Z
+LZPNU)\PSK
6WLYH[L+)6
[V
`LHYZ
(JVTWHU`KLZPNUZHUKJVUZ[Y\J[Z
HUL^MHJPSP[`VY\WNYHKLZHU
L_PZ[PUNVULHUK[OLUY\UZHUK
THUHNLZP[;OLSVJHSNV]LYUTLU[
V^UZHUK\Z\HSS`ÄUHUJLZ[OL
WYVQLJ[
3LHZL `LHYZ (JVTWHU`Y\UZTHUHNLZHUK
THRLZPTWYV]LTLU[Z[VHULU[PYL
\[PSP[`HUK[OLSVJHSNV]LYUTLU[
V^UZ[OLZ`Z[LTHUKÄUHUJLZ[OL
PTWYV]LTLU[Z
*VUJLZZPVU `LHYZ (JVTWHU`Y\UZHUKTHUHNLZ
HULU[PYL\[PSP[`HUKÄUHUJLZ
PTWYV]LTLU[Z[VP[;OLSVJHS
NV]LYUTLU[YL[HPUZV^ULYZOPW
)RRG :DWHU:DWFK
7\ISPJWYP]H[LWHY[ULYZOPWZKVUV[
YLK\JLJVZ[Z
4\UPJPWHSP[PLZZOV\SKUV[L_WLJ[WYP]H[PaH[PVU[VYLK\JL
JVZ[Z,TWPYPJHSL]PKLUJLPUKPJH[LZ[OH[[OLYLPZUVZPNUPÄJHU[
KPMMLYLUJLPULMÄJPLUJ`IL[^LLUW\ISPJHUKWYP]H[L^H[LY
WYV]PZPVU0UTHU`JHZLZWYP]H[PaH[PVUPUJYLHZLZJVZ[Z
*VYWVYH[LWYVÄ[ZKP]PKLUKZHUKPUJVTL[H_LZJHUHKK[V
WLYJLU[[VVWLYH[PVUHUKTHPU[LUHUJLJVZ[ZHUKHSHJR
VMJVTWL[P[PVUHUKWVVYULNV[PH[PVUZRPSSZJHUSLH]LSVJHS
NV]LYUTLU[Z^P[OL_WLUZP]LJVU[YHJ[Z
4\UPJPWHSP[PLZ[LUK[VNL[[OLIHKLUKVM[OLKLHS^OLU
WYP]H[PaPUNTVUVWVS`ZLY]PJLZ-VYL_HTWSLTHU`^HZ[L^H
[LYJVU[YHJ[ZHSSV^WYP]H[LVWLYH[VYZ[VWHZZ[OYV\NOWYVK\J
[PVUJVZ[ZSLH]PUN[OLSVJHSNV]LYUTLU[WH`PUNTVYL[OHU
P[^V\SKOH]L^P[OW\ISPJWYV]PZPVU 7YP]H[LVWLYH[VYZHSZV
PUJYLHZPUNS`YLX\PYLW\ISPJZ\IZPKPLZVYN\HYHU[LLZILMVYL
[HRPUNVU^H[LYWYVQLJ[ZLZWLJPHSS`PU\UKLYKL]LSVWLKJV\U
[YPLZ
0U[OLVY`JVTWL[P[PVU^V\SKSLHK[VJOLHWLYJVU[YHJ[ZI\[
PUWYHJ[PJLYLZLHYJOLYZOH]LMV\UK[OH[[OL^H[LYTHYRL[
PZ¸YHYLS`JVTWL[P[P]L¹;OLYLHYLVUS`HZTHSSU\TILYVM
WYP]H[L^H[LYI\ZPULZZLZHUK:\LaHUK=LVSPHIV[O-YLUJO
T\S[PUH[PVUHSZKVTPUH[L[OLTHYRL[0U[OL<UP[LK:[H[LZ
[OLNYV^PUNULLKMVYL_WLUZP]LPTWYV]LTLU[Z[V^H[LYHUK
ZL^LYZ`Z[LTZJV\SKPUZWPYLJVYWVYH[PVUZ[VM\Y[OLYJVU
ZVSPKH[LHUK[HRLV]LYJVTWL[P[VYZPUVYKLY[VOH]LNYLH[LY
HJJLZZ[VJHWP[HS(SHJRVMJVTWL[P[PVUJHUSLHK[VL_JLZZ
WYVÄ[ZHUKJVYY\W[PVUPUWYP]H[LVWLYH[PVUZ
7VVYJVU[YHJ[ULNV[PH[PVUZRPSSZHKK[V[OPZWYVISLT4HU`
T\UPJPWHSP[PLZSHJR[OLULJLZZHY`[LJOUPJHSL_WLY[PZL[VULNV
[PH[LHJVTWSL_^H[LYWYP]H[PaH[PVUJVU[YHJ[WHY[PJ\SHYS`VUL
PU]VS]PUNWYP]H[LÄUHUJPUN;OLYLZ\S[PUNKPZWHYP[`PUIHY
NHPUPUNWV^LYIL[^LLU[OLSVJHSNV]LYUTLU[HUK[OL^H[LY
JVTWHU`^OPJOPZVM[LUHSHYNLT\S[PUH[PVUHSJHUPUJYLHZL
YPZRZHUKJVZ[ZMVY[OLW\ISPJ
;V[HS*VZ[VMH@LHY4PSSPVU
3VHU
4P
S
S
P
V
U
Z

V
M

+
V
S
S
H
Y
Z
7\ISPJ-PUHUJPUN 7YP]H[L-PUHUJPUN
TPSSPVU
TPSSPVU
0
$50
$100
$150
$200
$250
$300
3XEOLF3ULYDWH3DUWQHUVKLSV,VVXHVDQG'LI¿FXOWLHVZLWK3ULYDWH:DWHU6HUYLFH
7\ISPJWYP]H[LWHY[ULYZOPWZJHUIL
L_WLUZP]L[VPTWSLTLU[
,Z[HISPZOPUNW\ISPJWYP]H[LWHY[ULYZOPWZMVY^H[LYZ`Z[LTZPZ
JVTWSPJH[LKL_WLUZP]LHUK[PTLJVUZ\TPUN;OLJVZ[VM
L_LJ\[PUNHUKTVUP[VYPUNHJVU[YHJ[JHUILZ\IZ[HU[PHSHUK
LYVKLHU`WV[LU[PHSZH]PUNZ0U[V[HSJVU[YHJ[TVUP[VYPUN
HUKHKTPUPZ[YH[PVUJVU]LYZPVUVM[OL^VYRMVYJL\UWSHUULK
^VYRHUK\ZLVMW\ISPJLX\PWTLU[HUKMHJPSP[PLZJHUPU
JYLHZL[OLWYPJLVMHJVU[YHJ[I`HZT\JOHZWLYJLU[ 
6[OLYOPKKLUL_WLUZLZPUJS\KPUNJOHUNLVYKLYZHUKJVZ[
V]LYY\UZJHUM\Y[OLYPUÅH[L[OLWYPJLVMWYP]H[LZLY]PJL
9LULNV[PH[PVUZHSZVKYP]L\WJVZ[Z0U[OL<UP[LK2PUNKVT
JVU[YHJ[JOHUNLZVJJ\YYLKPUH[OPYKVMHSS*LU[YHS.V]LYU
TLU[WYP]H[PaH[PVUWYVQLJ[ZZPNULKIL[^LLUHUK
HUKPUJYLHZLK[OLWYVQLJ[JVZ[ZI`HUH]LYHNLVM‰TPSSPVU
VY[OLLX\P]HSLU[VMWLYJLU[VM[OL]HS\LVMLHJOWYVQ
LJ[(>VYSK)HURYL]PL^VMTVYL[OHUJVUJLZZPVU
HNYLLTLU[ZPU3H[PU(TLYPJHHUK[OL*HYPIILHUMV\UK[OH[
YLULNV[PH[PVUZVJJ\YYLKPU[OYLLX\HY[LYZVM[OL^H[LYHUK
ZHUP[H[PVUJVU[YHJ[Z
)LJH\ZLVM[YHUZHJ[PVUJVZ[ZW\ISPJWYP]H[LWHY[ULYZOPWZHYL
PTWYHJ[PJHSMVYIV[OZTHSS\[PSP[PLZHUKSHYNLYLNPVUHS^H[LY
KPZ[YPJ[Z;YHUZHJ[PVUJVZ[ZJHUILWYVOPIP[P]LS`OPNOMVYZTHSS
T\UPJPWHSP[PLZ-VY[OH[YLHZVU[OL<2»Z;YLHZ\Y`JVUZPKLYZ
W\ISPJWYP]H[LWHY[ULYZOPWZ¸UV[Z\P[HISL¹MVYWYVQLJ[Z^VY[O
SLZZ[OHU‰TPSSPVUHWWYV_PTH[LS`TPSSPVUPU<:
KVSSHYZ:PTPSHYS`NP]LU[OLPU[YPJHJ`VM[OL[YHUZHJ[PVU
[OLWYP]H[PaH[PVUVMSHYNL^H[LYHUKZL^LYZ`Z[LTZJHUIL
LZWLJPHSS`[PTLPU[LUZP]L;OL<:,U]PYVUTLU[HS7YV[LJ[PVU
(NLUJ`ZHPK¸0U[OLJHZLVML_[YLTLS`SHYNLYLNPVUHSMHJPSP
[PLZ^P[OTHU`WHY[PJPWH[PUNJVTT\UP[PLZ[OLWYVJLZZTH`
ILJVTLZVJVTWSL_[OH[P[^V\SKILKPMÄJ\S[[VPTWSLTLU[¹
7\ISPJWYP]H[LWHY[ULYZOPWZJHU^VYZLU
ZLY]PJL
;OLYLPZHTWSLL]PKLUJL[OH[THPU[LUHUJLIHJRSVNZ^HZ[LK
^H[LYZL^HNLZWPSSZHUK^VYZLZLY]PJLVM[LUMVSSV^WYP]H
[PaH[PVU0UMHJ[WVVYWLYMVYTHUJLPZ[OLWYPTHY`YLHZVU
[OH[SVJHSNV]LYUTLU[ZYL]LYZL[OLKLJPZPVU[VWYP]H[PaLHUK
YLZ\TLW\ISPJVWLYH[PVUVMWYL]PV\ZS`JVU[YHJ[LKZLY]PJLZ
>OLUWYP]H[LVWLYH[VYZH[[LTW[[VJ\[JVZ[ZWYHJ[PJLZ[OL`
LTWSV`JV\SKYLZ\S[PU^VYZLZLY]PJLX\HSP[`;OL`TH`\ZL
ZOVKK`JVUZ[Y\J[PVUTH[LYPHSZKLSH`ULLKLKTHPU[LUHUJLVY
KV^UZPaL[OL^VYRMVYJL^OPJOPTWHPYZJ\Z[VTLYZLY]PJLHUK
ZSV^ZYLZWVUZLZ[VLTLYNLUJPLZ:\JOULNSLJ[JHUOHZ[LU
LX\PWTLU[IYLHRKV^UZHUKPUJYLHZLYLWSHJLTLU[JVZ[Z
^OPJOHYL\Z\HSS`[OLYLZWVUZPIPSP[`VM[OLT\UPJPWHSP[`0U
THU`JVU[YHJ[ZWYP]H[LVWLYH[VYZJHU[LJOUPJHSS`JVTWS`
^P[O[OLPYJVU[YHJ[[LYTZ^OPSLLMMLJ[P]LS`ZOPM[PUN\WRLLW
JVZ[Z[V[OLSVJHSNV]LYUTLU[
(YLWVY[W\ISPZOLKI`[OL5H[PVUHS9\YHS>H[LY(ZZVJPH[PVU
MV\UKKL[LYPVYH[PVUVM^H[LYZ`Z[LTZJHUIL¸WHY[PJ\SHYS`
WYVISLTH[PJ¹PUSVUN[LYTJVU[YHJ[Z)LJH\ZL[V
WLYJLU[VM^H[LYHUKZL^LYHZZL[ZHYL\UKLYNYV\UKHT\
UPJPWHSP[`JHUUV[LHZPS`TVUP[VYHJVU[YHJ[VY»ZWLYMVYTHUJL
*VUZLX\LU[S`HZHYLZLHYJOLYMVY[OL.SVIHS>H[LY(K]PZVY`
*VTTP[[LL^HYULK¸;OLLMMLJ[ZVMZOVKK`^VYRTH`UV[
ILJVTLL]PKLU[K\YPUN[OLJVU[YHJ[PUNWLYPVK¹
)RRG :DWHU:DWFK
7\ISPJWYP]H[LWHY[ULYZOPWZJHUSLHK[V
QVISVZZ
.V]LYUTLU[WYVNYHTZHPTLKH[QVIJYLH[PVUZOV\SKUV[HS
SVJH[LYLZV\YJLZ[VVYLUKVYZLW\ISPJWYP]H[LWHY[ULYZOPWZMVY
^H[LYPUMYHZ[Y\J[\YL0UVYKLY[VPUJYLHZLWYVÄ[ZWYP]H[LTHU
HNLYZ\Z\HSS`J\[SHIVYJVZ[ZI`KV^UZPaPUN[OL^VYRMVYJL
VYZJHSPUNIHJRJVTWLUZH[PVUWHJRHNLZ^OPJOJHU^VYZLU
ZLY]PJLX\HSP[`6UH]LYHNLTVYL[OHUVUL[OPYKVM^H[LY
\[PSP[`QVIZHYLSVZ[HM[LYWYP]H[PaH[PVU)V[O-HPYÄLSK:\PZ\U
:L^LY+PZ[YPJ[HUK7L[HS\TH*HSPMLUKLKJVU[YHJ[ZHUK
YLT\UPJPWHSPaLK[OLPYZL^LYZLY]PJLZ[VZH]LTVUL`^OPSL
VMMLYPUNIL[[LYJVTWLUZH[PVUWHJRHNLZULLKLK[VH[[YHJ[
X\HSPÄLKWLYZVUULS
7\ISPJWYP]H[LWHY[ULYZOPWZJHUYLK\JL
HJJV\U[HIPSP[`
7YP]H[LVWLYH[VYZ\Z\HSS`YLZ[YPJ[W\ISPJHJJLZZ[V
PUMVYTH[PVUHUKKVUV[OH]L[OLZHTLSL]LSVMVWLUULZZ
HZ[OLW\ISPJZLJ[VY3VUN[LYTJVU[YHJ[ZPUWHY[PJ\SHY
[`WPJHSS`YLK\JLHJJV\U[HIPSP[`HUK[YHUZWHYLUJ`ILJH\ZL
[OLUH[\YLVM[OLJVU[YHJ[ZYLX\PYLZWYVQLJ[PUNULLKZMHYPU[V
[OLM\[\YLJYLH[PUN[LYTZ[OH[HYLPUJVTWSL[LVYYPKKSLK
^P[O\UJLY[HPU[`(JJVYKPUN[V[OL.V]LYUTLU[VM*HUHKH
7VSPJ`9LZLHYJO0UZ[P[\[L¸(SHJRVM[YHUZWHYLUJ`WYV[LJ[Z
HU[PJVTWL[P[P]LILOH]PV\YHUK\Z\HSS`YLZ\S[ZPUHSVZZVM
LMÄJPLUJ`¹
>OH[YVSLZOV\SK[OLWYP]H[LZLJ[VY
WSH`&
-YVTKL]LSVWPUNUL^[LJOUVSVNPLZ[VWYV]PKPUN
JVUZ[Y\J[PVUJYL^ZMVYUL^[YLH[TLU[WSHU[Z[OLWYP]H[L
ZLJ[VYWSH`ZHUPTWVY[HU[YVSLPUWYV[LJ[PUNV\Y^H[LY
YLZV\YJLZHUKÄUKPUNPUUV]H[P]LZVS\[PVUZ[V[OL^H[LY
JYPZPZ(S[OV\NO[OLW\ISPJHUKWYP]H[LZLJ[VYZ^VYR^LSS
[VNL[OLYPUTHU`HYLHZI\ZPULZZLZZOV\SKUV[VWLYH[L
THUHNLVYV^UW\ISPJKYPURPUN^H[LYVY^HZ[L^H[LY
Z`Z[LTZ;OVZLK\[PLZZOV\SKMHSS\UKLY[OLW\Y]PL^VMSVJHS
NV]LYUTLU[Z^OVOH]LHYLZWVUZPIPSP[`[VLUZ\YLZHMLHUK
HMMVYKHISLZLY]PJL
0[PZPSSVNPJHSMVY[H_WH`LYZ[VZ\IZPKPaLMVYWYVÄ[^H[LY
ZLY]PJLWYV]PKLYZ^OVYLN\SHYS`ZLUKWYVÄ[ZV\[VMSVJHS
JVTT\UP[PLZ[VZ[VJROVSKLYZ.V]LYUTLU[ZZOV\SKHSSVJH[L
[OLSPTP[LKM\UKPUNMVY^H[LYWYVQLJ[Z[VW\ISPJS`V^ULK
HUKVWLYH[LK\[PSP[PLZ^OPJO^PSSYLPU]LZ[[OLTVUL`PU[V
[OLPYJVTT\UP[PLZ
7\ISPJW\ISPJWHY[ULYZOPWZHYLHIL[[LY
VW[PVU
0UZ[LHKVMWYP]H[PaPUN^H[LYZ`Z[LTZT\UPJPWHSP[PLZJHU
WHY[ULY[VNL[OLY[OYV\NOW\ISPJW\ISPJWHY[ULYZOPWZ0U
[LYT\UPJPWHSJVVWLYH[PVUPU[LYSVJHSHNYLLTLU[ZHUKI\SR
W\YJOHZPUNJVUZVY[P\TZJHUPTWYV]LW\ISPJZLY]PJLZHUK
YLK\JLJVZ[Z^OPSLHSSV^PUNJVTT\UP[PLZ[VYL[HPUSVJHS
JVU[YVS7\ISPJW\ISPJWHY[ULYZOPWZHYLTVYLLX\P[HISL[OHU
WYP]H[PaH[PVUWHY[PJ\SHYS`MVYY\YHS<:T\UPJPWHSP[PLZYPML
^P[OTHYRL[MHPS\YL
(YV\UK[OL^VYSKW\ISPJW\ISPJWHY[ULYZOPWZHYLMHYTVYL
JVTTVU[OHUW\ISPJWYP]H[LWHY[ULYZOPWZ7\ISPJ:LY]PJLZ
0U[LYUH[PVUHS9LZLHYJO<UP[OHZKVJ\TLU[LKTVYL[OHU
W\ISPJW\ISPJWHY[ULYZOPWZPUJV\U[YPLZ0UJVTWHYPZVU
VUS`JV\U[YPLZOH]LWYP]H[LWHY[PJPWH[PVUPU^H[LYZLY]PJLZ
;OLYLPZNYV^PUNTVTLU[\TPU[OLPU[LYUH[PVUHSJVTT\UP[`
[VZ\WWVY[W\ISPJW\ISPJWHY[ULYZOPWZHZHKL]LSVWTLU[[VVS
MVY^H[LYZLY]PJLZ
(IV\[-VVK
>H[LY>H[JO!-VVK
>H[LY>H[JOPZHUVUWYVÄ[JVUZ\TLYVYNHUPaH[PVU[OH[
^VYRZ[VLUZ\YLJSLHU^H[LYHUKZHMLMVVK-VVK
>H[LY>H[JO^VYRZ^P[ONYHZZYVV[ZVYNHUPaH
[PVUZHYV\UK[OL^VYSK[VJYLH[LHULJVUVTPJHSS`HUKLU]PYVUTLU[HSS`]PHISLM\[\YL;OYV\NO
YLZLHYJOW\ISPJHUKWVSPJ`THRLYLK\JH[PVUTLKPHHUKSVII`PUN^LHK]VJH[LWVSPJPLZ[OH[
N\HYHU[LLZHML^OVSLZVTLMVVKWYVK\JLKPUHO\THULHUKZ\Z[HPUHISLTHUULYHUKW\ISPJ
YH[OLY[OHUWYP]H[LJVU[YVSVM^H[LYYLZV\YJLZPUJS\KPUNVJLHUZYP]LYZHUKNYV\UK^H[LY

*VW`YPNO[(WYPSI`-VVK
>H[LY>H[JO(SSYPNO[ZYLZLY]LK;OPZIYPLÄUNWHWLYJHUIL]PL^LKVYKV^USVHKLKH[^^^MVVKHUK^H[LY^H[JOVYN
,UKUV[LZ
-VYL_HTWSLZLL!7H[LYZVU+H]PK((YUVSK:JO^HYaLULNNLYHUK
,K9LUKLSS¸;OLTVTLU[MVYW\ISPJWYP]H[LWHY[ULYZOPWZPZUV^¹
/\MÄUN[VU7VZ[1\UL ";OL5H[PVUHS*V\UJPSMVY7\ISPJ7YP]H[L
7HY[ULYZOPWZ¸-VY[OLNVVKVM[OLWLVWSL!<ZPUNW\ISPJWYP]H[LWHY[ULY
ZOPWZ[VTLL[(TLYPJH»ZLZZLU[PHSULLKZ¹H["+LHUL4PJOHLS
5H[PVUHS(ZZVJPH[PVUVM>H[LY*VTWHUPLZ¸(KKYLZZPUN(TLYPJH»ZHNPUN
PUMYHZ[Y\J[\YL¹/\MÄUN[VU7VZ[-LIY\HY` 
>HYULY4PSKYLK,HUK.LYTn)LS¸*VTWL[P[PVUVYTVUVWVS`&
*VTWHYPUNWYP]H[PaH[PVUVMSVJHSW\ISPJZLY]PJLZPU[OL<:HUK:WHPU¹
7\ISPJ(KTPUPZ[YH[PVU]VSPZZH[ [V
)VUK)\`LY0UKL_LZ)VUK.60UKL_1HU\HY`[V+LJLTILY
 (]HPSHISLH[^^^IVUKI\`LYJVTTHYRL[Z[H[PZ[PJZZLHYJOF
IIPO[TSHJJLZZLK-LIY\HY`
:WLSTHU1LMMHUK4PRL0ZILSS6RSHOVTH;H_*VTTPZZPVU
¸*HWP[HSPaH[PVUYH[LZ[\K`¹(WYPS H["(TLYPJHU>H[LY>VYRZ
(ZZVJPH[PVU¸:[\K`VUWYP]H[LHJ[P]P[`IVUKZHUK^H[LY\[PSP[PLZ¹1\UL
 H[ "+V^1VULZ0UKL_LZ/PZ[VYPJHS<[PSP[`0UKL_=HS\LZMYVT
+LJ 1HU\HY`[V+LJLTILY (]HPSHISLH[^^^
KQPUKL_LZJVTTKZPK_&L]LU[$ZOV^*VYW)VUKHJJLZZLK-LIY\HY`
"6YNHUPaH[PVUVM,JVUVTPJ*VVWLYH[PVUHUK+L]LSVWTLU[
6,*+;H_+H[HIHZL;HISL00!*VYWVYH[LPUJVTL[H_YH[L1\UL
  -VYTL[OVKVSVN`ZLL-VVK
>H[LY>H[JO¸4VY[NHNPUN
4PS^H\RLL»Z-\[\YL!>O`3LHZPUN[OL>H[LY:`Z[LTPZH)HK+LHSMVY
*VUZ\TLYZ¹5V]LTILY H[ [V
:LL09:9L]LU\L7YVJLK\YL *-9"<:
,U]PYVUTLU[HS7YV[LJ[PVU(NLUJ`6MÄJLVM>H[LY¸9LZWVUZL[V
*VUNYLZZVUWYP]H[PaH[PVUVM^HZ[L^H[LYMHJPSP[PLZ¹,7( H
1\S` H[[V
/HSS+H]PKHUK,THU\LSL3VIPUH7\ISPJ:LY]PJLZ0U[LYUH[PVUHS
9LZLHYJO<UP[¸7PWL+YLHTZ!;OL-HPS\YLVM[OL7YP]H[L:LJ[VY[V0U]LZ[
PU>H[LY:LY]PJLZPU+L]LSVWPUN*V\U[YPLZ¹4HYJOH[[V 
6\`HOPH4LYPLT(P[7VSPJ`9LZLHYJO0UP[PH[P]L.V]LYUTLU[VM
*HUHKH¸7\ISPJWYP]H[LWHY[ULYZOPWZMVYM\UKPUNT\UPJPWHSKYPURPUN
^H[LYPUMYHZ[Y\J[\YL!>OH[HYL[OLJOHSSLUNLZ&¹4H`H[HUK"
)LS.LYTnHUK4PSKYLK>HYULY¸+VLZWYP]H[PaH[PVUVMZVSPK^HZ[LHUK
^H[LYZLY]PJLZYLK\JLJVZ[Z&(YL]PL^VMLTWPYPJHSZ[\KPLZ¹9LZV\YJLZ
*VUZLY]H[PVUHUK9LJ`JSPUN]VSPZZ6J[VILYH[
HUK"7tYHYK,KV\HYK¸>H[LYZ\WWS`!7\ISPJVYWYP]H[L&(U
HWWYVHJOIHZLKVUJVZ[VMM\UKZ[YHUZHJ[PVUJVZ[ZLMÄJPLUJ`HUKWV
SP[PJHSJVZ[Z¹7VSPJ`HUK:VJPL[`PZZ H[ HUK [V 
(ZZVJPH[PVUVM4L[YVWVSP[HU:L^LYHNL(NLUJPLZHUK(ZZVJPH[PVUVM
4L[YVWVSP[HU>H[LY(NLUJPLZ¸,]HS\H[PUN7YP]H[PaH[PVU00!(U(4:(
(4>(*OLJRSPZ[¹H[
/VSJVTIL9HUKHSS.¸7YP]H[PaH[PVUVMT\UPJPWHS^HZ[L^H[LY[YLH[
TLU[¹7\ISPJ)\KNL[PUN
-PUHUJL]VSPZZ-HSS H[ 
HUK
6\`HOPHH[
)LS.LYTnHUK4PSKYLK>HYULY¸*OHSSLUNPUNPZZ\LZPUSVJHSWYP]H[PaH
[PVU¹,U]PYVUTLU[7SHUUPUN*!.V]LYUTLU[HUK7VSPJ`]VSPZZ
H[
)SHJR9VNLY+LSVP[[L*VYWVYH[L-PUHUJL¸777ZHUK[OL^H[LYZLJ[VY!
7S\NNPUN[OLPUMYHZ[Y\J[\YLOVSL¹4HYJO H[
6\`HOPHH[
-P[JO9H[PUNZB7YLZZ9LSLHZLD¸-P[JO!,ZJHSH[PUNJHWP[HSJVZ[ZTH`SLHK
[VJVUZVSPKH[PVUMVY<:^H[LY\[PSP[PLZ¹)\ZPULZZ>PYL1HU\HY`

)LSHUK>HYULY¸*OHSSLUNPUNPZZ\LZPUSVJHSWYP]H[PaH[PVU¹H[
")LSHUK>HYULY6J[VILYH[[V
6\`HOPHH[
0IPKH[":LWWpSp6ZTV;1HYTV1/\RRHHUK;HWPV:2H[RV
¸7\ISPJWYP]H[LWHY[ULYZOPWZPU^H[LYHUKZL^LYHNLZLY]PJLZ!
7YP]H[PaH[PVUMVYWYVÄ[VYPTWYV]LTLU[VMZLY]PJLHUKWLYMVYTHUJL&¹
7\ISPJ>VYRZ4HUHNLTLU[7VSPJ`]VSPZZH[
-LH[OLYZ[\U+VUHSK.+>OP[UL`;OVYU[VU00HUK1.YLNVY`*VYYLU[P¸:[H[LHUKSVJHSWYP]H[PaH[PVU!(UL]VS]PUNWYVJLZZ¹7\ISPJ*VU[YHJ[3H^1V\YUHS]VSPZZ:\TTLYH[  (TLYPJHU-LKLYH[PVUVM:[H[L*V\U[`HUK4\UPJPWHS,TWSV`LLZ(-3*06¸.V]LYUTLU[MVY:HSL!(UL_HTPUH[PVUVM[OLJVU[YHJ[PUNV\[VMZ[H[LHUKSVJHSNV]LYUTLU[ZLY]PJLZ¹,PNO[,KP[PVU H["4HY[PU3H^YLUJL9LHZVU0UZ[P[\[L¸/V^[VJVTWHYLJVZ[ZIL[^LLUPUOV\ZLHUKJVU[YHJ[LKZLY]PJLZ¹4HYJO H[[V0VZZH,SPZHIL[[HHUK+H]PK4HY[PTVY[*LU[YLMVY,JVUVTPJHUK0U[LYUH[PVUHS:[\KPLZ<UP]LYZP[`VM9VTL¸;OLZPTWSLTPJYVLJVUVTPJZVMW\ISPJWYP]H[LWHY[ULYZOPWZ¹4H`H[.\HZJO13\PZ;OL>VYSK)HUR¸.YHU[PUNHUK9LULNV[PH[PUN0UMYHZ[Y\J[\YL*VUJLZZPVUZ!+VPUN0[9PNO[¹>)0+L]LSVWTLU[:[\KPLZ1HU\HY`H["7tYHYK H[/4;YLHZ\Y`¸:[HUKHYKPZH[PVUVM7-0JVU[YHJ[Z]LYZPVU¹4HYJOH["/4;YLHZ\Y`¸7-0!:[YLUN[OLUPUNSVUN[LYTWHY[ULYZOPWZ¹4HYJOH["0VZZHHUK4HY[PTVY[H[<:,U]PYVUTLU[HS7YV[LJ[PVU(NLUJ` H[-VYTVYLPUMVYTH[PVUZLL-VVK
>H[LY>H[JO¸-H\S[`7PWLZ!>O`7\ISPJ-\UKPUN¶5V[7YP]H[PaH[PVUPZ[OL(UZ^LYMVY<:>H[LY:`Z[LTZ¹:LW[LTILY>HYULY4PSKYLK>;OL*LU[\Y`-V\UKH[PVU¸3VJHSNV]LYUTLU[PUMYHZ[Y\J[\YLHUK[OLMHSZLWYVTPZLVMWYP]H[PaH[PVU¹ H[ :TP[O/HYVSK19HM[LSPZ-PUHUJPHS*VUZ\S[PUN¸7YP]H[PaH[PVUVM:THSS>H[LY:`Z[LTZ¹9\YHS>H[LY7HY[ULYZOPW-\UK>OP[L7HWLY5H[PVUHS9\YHS>H[LY(ZZVJPH[PVU+LJLTILYH[(ZZVJPH[PVUVM4L[YVWVSP[HU:L^LYHNL(NLUJPLZHUK(ZZVJPH[PVUVM4L[YVWVSP[HU>H[LY(NLUJPLZH[:TP[OH[  9LLZ1\KP[O.SVIHS>H[LY7HY[ULYZOPW;LJOUPJHS(K]PZVY`*VTTP[[LL¸9LN\SH[PVUHUKWYP]H[LWHY[PJPWH[PVUPU[OL^H[LYHUKZHUP[H[PVUZLJ[VY¹;(*)HJRNYV\UK7HWLYZ5V1\S` H["6\`HOPHH[[V :LWWpSp/\RRHHUK2H[RVH[:LL-VVK
>H[LY>H[JO¸>H[LY7YP]H[PaH[PVU;OYLH[LUZ>VYRLYZ*VUZ\TLYZHUK3VJHS,JVUVTPLZ¹4H` "4VVYL(KYPHU¸3VUN[LYTWHY[ULYZOPWZPU^H[LYHUKZL^LY\[PSP[PLZ!,JVUVTPJWVSP[PJHSHUKWVSPJ`PTWSPJH[PVUZ¹<UP]LYZP[PLZ*V\UJPSVU>H[LY9LZV\YJLZPZZ6J[VILYH[*P[`*V\UJPSVM7L[HS\TH*HSPM>H[LY9LZV\YJLZ
*VUZLY]H[PVU¸(NLUKH;P[SL!7YLZLU[H[PVU+PZJ\ZZPVUHUK7VZZPISL(J[PVU9LNHYKPUN7SHUMVY6WLYH[PVUHUK4HPU[LUHUJLVM[OL,SSPZ*YLLR>H[LY9LJ`JSPUN-HJPSP[`¹5V]LTILY H["*P[`VM7L[HS\TH¸9LN\SHYJP[`JV\UJPS7*+*TLL[PUN¹5V]LTILY H[[V"-HPYÄLSK:\PZ\U:L^LY+PZ[YPJ[)VHYKVM+PYLJ[VY¸(UHS`ZPZVM[OL<ZLVM*VU[YHJ[6WLYH[PVUZ¹1HU\HY`H[[VHUK[V"-HPYÄLSK:\PZ\U:L^LY+PZ[YPJ[-PUHUJL+LWHY[TLU[¸*VTWYLOLUZP]L(UU\HS-PUHUJPHS9LWVY[MVY[OL@LHY,UKLK1\UL ¹ H[[V6\`HOPHH[HUK)LS.LYTHHUK?H]PLY-HNLKH¸)L[^LLUWYP]H[PaH[PVUHUKPU[LYT\UPJPWHSJVVWLYH[PVU!:THSST\UPJPWHSP[PLZZJHSLLJVUVTPLZHUK[YHUZHJ[PVUJVZ[Z¹<YIHU7\ISPJ,JVUVTPJZ9L]PL^H[HUK"+VPU+H]L¸7\ISPJÄUHUJPUNHUKWYVJ\YLTLU[TL[OVKZ¹>H[LY>VYSK1\ULH[")VHN.LTTHHUK+H]PK(4J+VUHSK¸(JYP[PJHSYL]PL^VMW\ISPJW\ISPJWHY[ULYZOPWZPU^H[LYZLY]PJLZ¹>H[LY(S[LYUH[P]LZPZZUV-LIY\HY`>HYULY4PSKYLKHUK(TPY/LML[a¸9\YHS\YIHUKPMMLYLUJLZPUWYP]H[PaH[PVU!SPTP[Z[V[OLJVTWL[P[P]LZ[H[L¹,U]PYVUTLU[HUK7SHUUPUN*!.V]LYUTLU[HUK7VSPJ`]VSH[HUK")VHNHUK4J+VUHSK/HSS+H]PKL[HS7\ISPJ:LY]PJLZ0U[LYUH[PVUHS9LZLHYJO<UP[¸7\ISPJW\ISPJWHY[ULYZOPWZ7<7ZPU^H[LY¹4HYJO H[HUK

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 9: Please describe, in detail, the factual basis for CAIA's statement in its Petition to
Intervene that there are "possible environmental harms stemming from the merger." Please provide any
and all relevant analyses, studies, or other documents concerning any possible environmental harms that
you attribute to the proposed Eagle Water Company asset acquisition by SUEZ.
Response: The financial hardship that Suez’s proposed rate hikes would impose on customers
could make it cost prohibitive to adequately water landscaping in residential and commercial common areas,
municipal parks and recreational venues. This would not only negatively impact the aesthetic value of these
areas but would also pose an increased fire risk and disruption to plant and animal life.
Furthermore, Suez’s standard practice of mixing groundwater with surface water across the Treasure
Valley has been well documented and necessitates chemical treatments to their water systems in excess of
the treatments currently applied by EWC. Maintenance of multiple, smaller, local water systems ensures
that water treatment is likewise localized, targeted to the needs of a particular system, rather than
standardized across multiple sources and distribution systems.
By fostering local control of such resources, CAIA would seek to ensure that accountability for
possible environmental harm also remains local. The separation of management activity from local
accountability increases environmental risks to local communities, because it encourages the treatment of
environmental impacts as externalities (costs imposed on external economies) rather than as genuine costs of
doing business. Likewise, the avoidance of environmental accountability by corporate utilities imposes
additional costs on rate payers above and beyond the rates paid, and divorces corporate profits from the real
impacts of corporate conduct.

In reaching its conclusions on this issue, CAIA has relied, in part on articles and analyses
produced herewith.

Residents in Eagle subdivision
get sick from drinking irrigation
water
Posted: 7:07 PM, Jul 31, 2018

Updated: 7:07 PM, Jul 31, 2018
By: Steve Dent

The Center District Health Department has received 20-25 reports of Eagle
residents getting sick from the water in the Corrente Bello Subdivision, the
CDHD said it was likely a gastrointestinal illness.
Suez water and residents discovered that irrigation water from a nearby canal made
it into several homes in the subdivision and that people in the neighborhood were
drinking contaminated water.
My fifteen-year-old was sick, I was sick, two of my daughters were sick," said Karen
Howell who has eight children. "I ran a bath for two-year-old and the water was
brown."
This neighborhood uses potable water for drinking, but they also have non-potable
water that residents can use to water their lawns or their gardens, each home has
what is called a backflow that acts as a fail safe to prevent the irrigation water from
mixing in with the drinking water in the homes.
Suez Water discovered one backflow in the neighborhood that got installed
backward and said that was the cause of tainting the water in several Corrente Bello
homes.
"Since 2012 we have had three similar cases and in every case, it was the result of an
improperly installed device by an unlicensed individual," said Marshall Thompson
the general manager for Suez.
Suez said they don't install the backflow devices, those are the homeowner's
responsibility, however, Suez said it is important to get the backflow installed by a
licensed company and to get it checked every year.
Residents did have their complaints about Suez during this whole process, mainly
because one neighbor called the water company on July 14 after discovering brown
water.
Suez said they responded with a technician who flushed the lines to that home, but
they said they didn't find low levels of chlorine, a red flag for contaminated water
because Suez uses chlorine to treat drinking water.
Suez called this an isolated incident and said it's not out of the ordinary to calls
regarding brown water, the technician told the homeowner their water was safe.
Another neighbor called Suez back on July 18, this time around Suez did find low
levels of chlorine and then discovered the improperly installed backflow device, then
Suez flushed the system and collected samples to test the water.
"Overall we responded in a timely manner," said Thompson. "Unfortunately the
water quality testing to verify the water sample takes two days to process."
On July 20 Suez alerted the residents that their water was safe, but they issued a
boil advisory to let residents know that the water inside their homes was likely still
contaminated.
Suez said the residents needed to flush their plumbing system, turn their water
heater to the highest setting, boil any water they were using in the home until the
system was flushed and replace all their water filters.
"We are out one hundred dollars in filters," said Howell who was about to take her
fifteen-year-old to the hospital. "I know people who have medical bills that they
have to pay and nobody says they are responsible for this, it is getting passed on to
us."
Howell also had complaints because she wanted to know what kind of bacteria her
family was drinking, Suez did not test the contaminated water until after they
flushed the lines.
We asked Suez who the homeowner was that had the backflow device that caused
the problem, they told us they would not give out that information in an effort to
protect their customers.
For more information on what a backflow does click here.

Home / Periodic table / Elements / Chlorine
Chlorine - Cl
Chemical properties of chlorine - Health effects of chlorine - Environmental effects of chlorine
Atomic number 17
Atomic mass 35.453 g.mol
Electronegativity according to Pauling 3.0
Density 3.21*10 g.cm at 20 °C
Melting point -101 °C
Boiling point -34.6 °C
Vanderwaals radius 0.127 nm
Ionic radius 0.184 (-2) nm ; 0.029 nm (+6)
Isotopes 4
Electronic shell [Ne] 3s 3p
Energy of first ionisation 1255.7 kJ.mol
Energy of second ionisation 2298 kJ.mol
Energy of third ionisation 3822 kJ.mol
Standard potential - 1.36 V
Discovered by Carl Wilhelm Scheele in 1774
Chlorine
Discovered in 1774 by Carl Wilhelm Scheele, who mistakenly thought it contained oxygen. Chlorine was given its name in 1810 by Humphry Davy, who insisted that it was in fact an
element.

The pure chemical element has the physical form of a diatomic green gas. The name chlorine is derived from chloros, meaning green, referring to the color of the gas. Chlorine gas is two
and one half times as heavy as air, has an intensely disagreeable suffocating odor, and is exceedingly poisonous. In its liquid and solid form it is a powerful oxidizing, bleaching, and
disinfecting agent.
This element is a part of the halogen series forming salts. It is extracted from chlorides through oxidation and electrolysis. Chlorine gas is greenish-yellow and combines readily with
nearly all other elements.
Applications
Chlorine is an important chemical in water purification, in disinfectants, in bleach and in mustard gas.

Chlorine is also used widely in the manufacture of many products and items directly or indirectly, i.e. in paper product production, antiseptic, dyestuffs, food, insecticides, paints,
petroleum products, plastics, medicines, textiles, solvents, and many other consumer products.
It is used to kill bacteria and other microbes from drinking water supplies.
Chlorine is involved in beaching wood pulp for paper making, bleach is also used industrially to remove ink from recycle paper.
Chlorine often imparts many desired properties in an organic compound when it is substituted for hydrogen (synthetic rubber), so it is widely use in organic chemistry, in the production of
chlorates, chloroform, carbon tetrachloride, and in the bromine extraction.
Chlorine in the environment
In nature it is only found combined with other elements chiefly sodium in the form of common salt (NaCl), but also in carnallite, and sylvite. Chlorides make up much of the salt dissolved
in the earth's oceans: about 1.9 % of the mass of seawater is chloride ions.
The amount of chloride in soils varies according to the distance from the sea. The average in top soils is about 10 ppm. Plants contain various amount of chlorine; it is an essential
microutrient for higher plants where is concentrates in the chloroplasts. Growth suffers if the amount of chloride in the soil fall below 2 ppm, but it rarely happens. The upper limit of
tolerance varies according to the crop.
Health effects of chlorine
Chlorine is a highly reactive gas. It is a naturally occurring element. The largest users of chlorine are companies that make ethylene dichloride and other chlorinated solvents, polyvinyl
chloride (PVC) resins, chlorofluorocarbons, and propylene oxide. Paper companies use chlorine to bleach paper. Water and wastewater treatment plants use chlorine to reduce water
levels of microrganisms that can spread disease to humans (disinfection).

Exposure to chlorine can occur in the workplace or in the environment following releases to air, water, or land. People who use laundry bleach and swimming pool chemicals containing
chlorine products are usually not exposed to chlorine itself. Chlorine is generally found only in industrial settings.

-1
-3 -3
2 5
-1
-1
-1

Contact us: [phone]


k to top

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No 10: Please describe, in detail, the factual basis for CAIA's statement in its Petition
to Intervene that "the outcome of the proceedings regarding the Joint Application could also impact
service to customers." Please provide any and all relevant analyses, studies, or other documents concerning
any impacts on service to customers that you attribute to the proposed Eagle Water Company asset
acquisition by SUEZ.
Response: Please see public comments by current, and former, Suez Water customers on the
IPUC website: http://www.puc.idaho.gov/fileroom/cases/summary/SUZW1802.html
Public records of numerous formal complaints about Suez with the Better Business Bureau
locally and across the US give further credence to the complaints raised elsewhere and document a
deeply flawed relationship with customers.
CAIA’s mission is focused on accountability and integrity in management of natural resources
and is based on the belief that local control enhances accountability and integrity. Where local control
must be sacrificed, alternative tools for local accountability can be developed and utilized so that local
and community interests are not sacrificed to the interests of distant shareholders and stakeholders.
In reaching its conclusions on this issue, CAIA has relied, in part on articles and analyses
produced herewith.

Fast facts about the company
interested in Shreveport's water
and sewer
 Jul 25, 2017

The city of Shreveport faces an enormous challenge: Does it take up the offer from a New Jersey-based
company to fix its water and sewer problems for free, or continue the costly process of fixing it with tax payer
dollars?
Tuesday, Shreveport's city council listened to a pitch made by a local attorney who asked them to consider
talking with Suez, North America, the nation's second largest private operator of municipal water systems in
the United States.
KTBS-3 Investigates looked into the company's history and discovered that some cities that partnered with
Suez had troubling outcomes.
A global non-profit organization called Food and Water Watch slammed Suez in a 2010 report. The document,
entitled "Suez Environment's Poor Record in the United States," outlined how Suez has operated for nearly
three decades under various names, including United Water, U.S. Water, and JMM Operational Services.
Some of the cities that have done business with Suez and dumped them include Houston and Laredo, Texas,
Milwaukee, Wis., and Atlanta, Ga.
One example is in 2003, when Atlanta ended its contract 16 years early with Suez. The city documented
numerous problems ranging from large maintenance backlogs to inadequate bill collection.
Camden, N.J. is another city that encountered similar problems with Suez after transferring control of its water
and sewer systems.
In 2008, 10 years into a 20-year deal, an audit found that inadequate contract supervision and the company's
poor performance cost the city millions of dollars and potentially jeopardized the health and safety of its
residents.
The audit exposed high unaccounted-for water loss, poor maintenance of water wells, storage tanks and fire
hydrants plus overbilling due to faulty meters.
The city of Milwaukee also dumped Suez, which was operating as United Water in 2007, after issuing 20
notices of non-compliance for problems, including sewage overflows.
Gloucester, Mass., similarly ended its contract with the company after bacterial contamination issues in 2009.
Gary, Ind., canceled its contract with Suez after 12 years of broken sewer lines and sinkholes that allegedly
went unaddressed for months. Between 2003 and 2007, there were more than 80 cave-ins as the sewer lines
fell apart.
United Water, now doing business as Suez, is also accused of increasing the cost of services in both Gary,
Ind. and Fairfield-Suisun, Calif.
Both cities ended its contract, opting to run their own water and sewer systems more efficiently and cheaper.
According to Food and Water Watch, private operation of municipal water and sewer systems often forces
consumers to pay more for worse service.
For more KTBS 3 In-Depth stories, follow this link: https://www.ktbs.com/news/arklatex-indepth/

OPINION
Water should be controlled by the people, not
Suez North America: View
Daniel Wolff Published 9:51 a.m. ET Oct. 18, 2016 | Updated 7:43 a.m. ET Oct. 19, 2016
More pressure to develop and rising environmental concerns are only
going to strain the present system even more.

(Photo: John Meore/The Journal News)
Nationwide, almost 90 percent of piped water comes from publicly owned utilities. But in Rockland and
Westchester counties, about 500,000 of us get our water from a private, profit-driven corporation.
Why?
Research shows that private companies in New York charge more than twice as much as government-
owned systems. And when local governments own their water, citizens get a larger say in how it’s used,
how much it costs, how it’s conserved, and how healthy it is.
The private entity that controls our water is called Suez North America, a subsidiary of a French-based
multinational, Suez Environment. In 2015, Suez Environment’s earnings totaled around 15 billion in euros
(about $16.5 billion), 70 percent of it from European customers.
How did our water end up in their hands?
The story goes back to just after the Civil War, when Hackensack, New Jersey was developing as a
suburb. Like many cities at the time, Hackensack was starting to have more people than it had wells, and
in 1869, a couple of politicians set up competing water companies. Soon, there was a system to pump
water from the Hackensack River into a reservoir, and by the turn of the century, the company was
supplying a string of north New Jersey towns.

Abandoned Hackensack Waterworks Site (Photo: SUBMITTED/Abandoned Relics, Cory Seamer)
In 1900, Hackensack Water bought out Spring Valley Water Works and Supply Company to its north in
New York. It seemed an unimportant acquisition — at the time, the little Spring Valley company had one
employee and all of 91 customers — but it meant the Hackensack Water Company now controlled most of
watershed of the 54-mile-long Hackensack River.
More expansion followed. In 1912, for example, Piermont signed a contract with the Spring Valley
system. At the time, Piermont’s only alternative was tapping a nearby section of the Hackensack or
Sparkill Creek, both already “decidedly contaminated.” Many local municipalities did the same. But nearby
Nyack offers an alternative model.
Until 1895, Nyack’s water was also provided by a private entrepreneur. But the village then used eminent
domain to buy back the private company, “mainly,” as the Water Commissioners wrote, “upon the ground
of relief to the individual taxpayers.” Residents were tired of being held hostage over a basic necessity,
and Nyack envisioned a new era where “public money … [would] not simply enrich private corporations.”
Hackensack Water Company, meanwhile, had already gotten rich — and was looking for more ways to
expand. By the 1920s, it was envisioning a dam across a marshy section of farmland in Rockland County
to create a reservoir out of the free-flowing Hackensack River. The Great Depression slowed things down,
but by 1957, the company had created de Forest Lake, primarily to provide water to the growing suburbs
of Bergen County.
In 1983, Hackensack Water became United Water, a legal move that allowed it to “exploit its large land
holdings.” In buying up water rights, it had acquired almost a thousand acres worth nearly $9 million. With
those profits, United had the resources to begin a series of corporate mergers. In 1994, it paid $200 million
to buy General Waterworks Corporation, creating the second largest privately owned water company in
the nation. In 2000, the French company that controlled 70 percent of General Waterworks turned around
and bought out United for about $1 billion. Hence, the French connection.
The multinational Suez then launched an ambitious campaign to privatize American water. In Atlanta,
Georgia, the for-profit company cut employees until service was affected and instituted procedures that
allegedly cost the city “millions of dollars.” Atlanta terminated its 20-year contract after just four years. In
Gary, Indiana, United Water’s management violated discharge limits and was accused of evading
environmental requirements. Gary, too, dissolved its contract with United. And in Camden, New Jersey,
there have been complaints of poor maintenance, faulty billing, and excessive water loss.

Signs advocating against the proposed Haverstraw Water Treatment Project popped up around Rockland County. The plan was
scrapped, but many are now fighting against the water company's proposal to recoup costs in its water rate case. (Photo: JOURNAL
NEWS FILE PHOTO)

Here in Rockland County, United Water developed a plan for a desalination plant that would take water
from the Hudson River. Opponents accused the multinational of seeking more profits through an
unnecessary project and not looking at viable conservation alternatives. In late 2015, New York State’s
Public Service Commission ordered Suez to abandon the project. At this date, the company is still trying to
raise its water prices to pay for the estimated $54 million it spent developing plans for the plant. To fight
the increases, Rockland County is suing Suez
This is just the latest in a 150-year-old conflict between private water and public need. While it seems
unlikely single communities can afford to do what Nyack once did — buy back their share of the watershed
— there might be a way to pool our resources.
Like the Hackensack snaking back and forth from New York to New Jersey, Germany’s Ruhr serves a
number of different regions and industries. Since 1913, a cross-governmental cooperative association has
distributed, monitored, and treated water with an “active commitment to the common good without striving
for corporate profits.” The cooperative’s 60 communities and nearly 400 businesses that make up the Ruhr
cooperative believe “environmental innovation, protection, and sustainability don’t stop at city borders.”
Imagine a cooperative water association for residents of Rockland County and North Jersey. Bonds and
pooled funding would make the initial purchase possible. Instead of creating profits for a private company,
we could manage our resources for the common good, ensure better water quality, set reasonable
development goals, and create more recreational green space. Instead of fighting a multinational company
over the future, citizens would be the majority stockholders in their community’s growth.
More pressure to develop and rising environmental concerns are only going to strain the present system
even more. Has the time come for us to take back our water?
The writer, an Upper Nyack resident, is an author, poet, songwriter and filmmaker.

THE BLOG
12/02/2010 12:25 pm ET Updated May 25, 2011
Suez’s Attempts to Silence Critics on Par with
its Water Management: A Failure

By Wenonah Hauter

Water justice advocates around the world cheered recently when a French court rejected
a defamation lawsuit brought by Suez Water against the makers of the documentary
film Flow. A multi-national private water provider, Suez had sued due to the film’s focus on
its role in profiting from (and often curtailing consumer access to) essential water
resources.
It’s hardly a surprise that Suez would aim to silence its critics — the company has left a
trail of sewage overflows, contaminated drinking water, decaying infrastructure, political
scandals and other examples of botched management in the wake of its attempt to profit
off of local water systems around the globe.
In January 2005, the government of Bolivia initiated the termination of its contract with the
Suez subsidiary Aguas del Illimani in El Alto and La Paz due to the company’s contractual
incompliance, pitiful service record and dismal environmental performance. An audit found
that the company had failed to make promised investments in local water systems and
had also failed to meet its obligations to expand drinking water and sewage service.
The audit also found that one of the company’s wastewater treatment plants had
discharged contaminants into the Rio Seco, posing serious environmental and public
health risks. Moreover, the company also failed to meet specific drinking water quality
standards established by the contract; in 2005, sulphate levels were found to exceed
levels acceptable for human consumption.
In addition to these violations, it seems that the company had been more than a little
creative in establishing the terms of its contract with the government of Bolivia — cherry
picking the areas where it would deliver water service, leaving many low-income areas
without drinking water. Some 200,000 people were stranded without water service, while
another 80,000 were effectively denied water as well because they could not afford to
shell out the equivalent of 450 U.S. dollars for the connection fee.
Similar problems have plagued Suez’s ventures in other countries. In 2006, Buenos Aires
terminated its 30-year contract with the Suez-controlled Aguas Argentinas claiming that
the company had failed to make promised system investments and that nitrate levels in
the water in some areas of the city exceeded legal limits.
Atlanta, Georgia cancelled its 20-year contract with Suez just four years into its service
agreement after the company slashed water system jobs in half and accumulated a
maintenance backlog of 14,000 work orders. The company was also linked to a local
political scandal in Atlanta, allegedly making questionable payments to then-mayor Bill
Campbell, who was eventually sentenced to 30 months in prison for tax evasion.
The French court’s decision to deny Suez’s claims upholds the rights of the media to
scrutinize the activities of multinational corporations, especially when those activities
compromise the ability of millions of people around the world to access a vital natural
resource. With 1.2 billion people lacking access to safe, clean, affordable water, it is
unconscionable that a company as powerful as Suez would choose to use its considerable
influence to obscure the facts behind this crisis.
Yet despite Suez’s attempts to the contrary, momentum to ensure affordable access to
potable water continues to escalate. On July 28 of this year, the United Nations General
Assembly passed a resolution to recognize water as a human right. Some 122 countries
representing more than five billion people supported the measure.
Last month, the director and production company behind Flow released an open letter to
Suez CEO Jean-Louis Chaussade, calling for a joint collaboration to develop new water
delivery methods to people in developing nations who currently lack basic water service.
The letter urges Chaussade to harness Suez’s considerable capital to help fight water-
related health problems, while supporting local economies and increasing social stability in
many parts of the world.
With Suez itself boasting of its commitment to “the challenge of protecting resources and
ecosystems” the proposition offered by the makers of Flow could be an opportunity for the
company to finally live up to its own marketing hype. It remains to be seen if facilitating
affordable water access is a realizable mission for a company that has so far made its
fortune profiting from the exploitation of a natural resource. In the meantime, water
warriors around the world will continue to help build the capacities of local governments
everywhere to deliver safe, clean affordable water to all.
Follow Wenonah Hauter on Twitter: www.twitter.com/WenonahHauter

Wenonah Hauter
Executive Director, Food & Water Watch and Food & Water Action Fund

By Paula J. Owen
Correspondent
Posted Feb 12, 2018 at 8:30 PM
Updated Feb 12, 2018 at 10:32 PM
GARDNER – The city is seeking to have a lawsuit filed against it and two of its
water consultants dismissed, arguing it was not filed within the statute of
limitation and that the city is immune to liability on the issue.
The suit alleges that the city and the companies hired to manage its water supply
were negligent and sold, supplied and distributed corrosive water to residents
and businesses.
In response, the city of Gardner, through its legal counsel, Jason Crotty of Pierce,
Davis & Pierritano LLP in Boston, is seeking to have the Worcester court
dismiss the suit.
In December, lawyer Michelle Blauner of the firm Shapiro Haber & Urmy in
Boston filed the class action lawsuit against the city, Suez Water Environmental
Services and AECOM Technical Services, on behalf of all residents and
businesses in Gardner whose copper heating coils, water heaters and boilers
were allegedly damaged by corrosive water.
The city and its water companies knew for years they could fix the problem by
adjusting the water chemistry with an additive, according to the complaint.
The class action suit was filed in Worcester Superior Court by Gardner resident
Janice Magliacane, who alleges the water supply was “unreasonably corrosive”
and “unreasonably damaged” the hot water heating systems of Gardner residents.
The suit contends the city “failed to implement its own corrosion control plan
and failed to take other actions which the City knew would mitigate coil
corrosion.”
Gardner asks court to dismiss lawsuit over
water system
In addition, Ms. Magliacane alleges that the coil corrosion problem could have
been avoided if the city added orthophosphate to its water treatment system to
inhibit corrosion of the distribution system piping and plumbing, as required by
state law.
However, the city contends that the incident Ms. Magliacane’s lawsuit is based
on occurred before 2010, yet she did not bring it to the city’s attention until
October 2017.
In a news release, City Solicitor John M. Flick asserts that the suit was not filed
within the two-year statute of limitation.
“To the extent Ms. Magliacane’s claims occurred on or before October 12, 2015,
they are now time barred for failure to present her claims within two years and
likely by the three-year statute of limitations as well,” the city contends in its
argument. “In addition, her presentment letter failed to allege nuisance as a
potential claim. Massachusetts law is clear, on this point.”
Additionally, the city argues that, even if Ms. Magliacane is able to “overcome
her failures to comply with the Massachusetts Tort Claims Act,” her suit must be
dismissed because the city is immune from liability.
According to state law, a municipality cannot be held liable for ”(A)ny claim
based on an act or failure to act to prevent or diminish the harmful consequences
of a condition or situation,” the argument contends.
A municipality can only be liable for a harm when an “affirmative act” by the
municipality “originally caused” the harm, not a failure to act by a public
employer, the city argues.
“On the contrary, she faults the City for failing to change the alkalinity of the
water,” the city argues. “Ms. Magliacane’s allegations merely present an alleged
omission by the City, not an affirmative act by any City employee in any aspect
of the incident ... Simply put, the City must weigh the benefit of adding a
chemical to its drinking water supply that will benefit a small percentage of the
water using population versus the possible future harm to the greater percentage
of the City’s water using population. Thus, the issue is a matter of public policy
and planning therefore, a discretionary act.”
When the city sought approval from the state to build the Crystal Lake and
Snake Pond wastewater treatment plants, a consultant recommended adding
orthophosphate to the water to protect the pipes in the late 1990s, according to
Ms. Blauner. The city’s water company sought approval to add orthophosphate
to the water and though the state approved the measure, it was never added, she
said.
When coils started to fail in the mid- to early 2000s, Ms. Blauner said, Gardner
still did not add the orthophosphate. The city began receiving complaints of coil
failures and started investigating, she said, and eventually contacted the
Environmental Protection Agency in 2011 about the issue.
Documents from 2012 indicate 400 coil failures, she said. The average cost of
replacing one of the coils is around $500 to $600, she said.
The EPA later determined the alkalinity of the water was very low, Ms. Blauner
said. A year after a 2015 report, the city asked the state, again, for approval to add
orthophosphate, she said. That was approved in August, 2017. It is unknown if
the city added the chemical.

Another Hoboken water
main breaks as mayor puts
blame on water company
POSTED 5:54 AM, AUGUST 29, 2018, BY KIRSTIN COLE, ALIZA CHASAN AND KRISTINE GARCIA, UPDATED AT 08:30AM,
AUGUST 29, 2018

HOBOKEN, N.J. — Hoboken residents are calling their city "Hobroken" as they
continue to deal with another water main break as a water main flooded the
PATH station terminal early Wednesday just hours after a water main broke
Tuesday evening around the corner.
The break, that occurred overnight Wednesday, adds to the increasing list of
water main breaks in the city within the past few months.
PATH service has not been impacted for the Wednesday morning commute, but
crews continue to remove the water out of the streets nearby.
Emergency crews continue to make the repairs for both water mains, SUEZ
tweeted Wednesday morning.

Hoboken Mayor Ravi Bhalla declared an emergency and said the city may plan
to take legal action against SUEZ, the water utility company.
Bhalla blamed the breaks on what he described as a mismanaged water meter
construction project.
"There can only be one explanation," Bhalla said at a press conference before
the Tuesday break. "Suez has mismanaged our system."
The water utility, however, says the city's aging infrastructure is to blame for the
water main breaks.
"The system is so old," a spokesperson said. "One hundred year old pipes have
outlasted their usefulness."
DHARNA NOOR     AUGUST 17, 2018
B
A Huge Win for Keeping Water Systems under Public
Control
(Photo by Dokaspar)
altimore is poised to become the first major U.S. city to prohibit privatization of its water system
and the first to do so by amending its city charter.
“Water privatization is simply unethical, immoral, and dangerous,” said Rianna Eckel, Maryland
organizer with Food and Water Watch and convener of the Right to Water Coalition Eckel, at a press
conference at City Hall on August 6, 2018. Behind her stood Baltimore Mayor Catherine Pugh, City
Council President Jack Young, and dozens of members of the Right to Water Coalition.
An hour later, Baltimore City Council overwhelmingly voted to approve the measure. Council President
Young, who introduced the amendment, fast-tracked the bill through the legislature. Mayor Catherine
Pugh signed it earlier this week. It will now go before voters on the November ballot, where it is
expected to pass.
“This feels like a major victory,” says Dr. Al Hathaway, Reverend of Baltimore’s Union Baptist Church.
For many at the press conference, it wasn’t their first time at City Hall to protect of public ownership of
Baltimore’s water system.
In 2014, some 50 environmental, labor, and faith-based organizers gathered outside Baltimore City Hall
to demand that the city maintain public ownership and management of its water system. The coalition,
calling themselves One Baltimore, formed when the city issued a public request for consultants to boost
the efficiency of the city’s wastewater treatment plants and filtration systems. One submission was
from the French company Veolia, which also manages the city’s free bus service known as the Charm
City Circulator.
City officials maintained that they had no intention of selling Baltimore’s water system to the company,
but advocates argued that such contracts could have been the first steps in a privatization scheme. The
coalition gained support from elected officials. Public hearings were held to assuage advocates’ fears.
The city maintained control of the system.
Members of the One Baltimore coalition stayed in close contact. In 2016, most became part of the Right
to Water Coalition, a group formed to support water affordability measures in Baltimore. The coalition
also worked to stop the city from placing properties on tax lien sales over unpaid water bills. They also
began lobbying Council President Young to introduce income-based water billing to combat the rising
price of city water bills, and to set up a water ombuds office to address billing concerns for the
hundreds of Baltimoreans who receive incorrect water bills each year.
Coalition members and organizers started hearing stories of the dangers of corporate involvement in
public water. News from Flint, Michigan captured headlines — Flint hired Veolia in 2015 to address the
potability of the city’s drinking water and to produce a report that said the water was safe to consume.
In Fall 2016, an attorney filed a lawsuit against Veolia and Texas firm LAN, alleging that Veolia knew the
water there was poisoned.
Another health crisis was brewing in Pittsburgh, Pennsylvania. In October 2016, the Pittsburgh Water
and Sewage Authority accused Veolia of “grossly mismanaging” the city’s water system from 2012-2015.
A lawsuit there was settled out of court earlier this year.
Baltimore advocates also learned that in 2014, the city of Bayonne, N.J., entered into a 40-year
agreement with another French company, Suez Environment, and a Wall Street firm, Kohlberg Kravis
Roberts (KKR), to manage the city’s water system. The corporations promised a four-year rate freeze,
but instead, they upped rates by 28 percent in the first three years.
In late 2017, the organizers learned that lobbyists were pitching Baltimore’s elected officials on the same
kind of deal — a 50-year agreement with Suez and KKR.
“I think I screamed in my office, an expletive that is not fit for print,” says Eckel.
Eckel explains that these kinds of leases make it very difficult for the city to pass affordability
ordinances — and could usher in a host of new problems.
“It was really horrifying to think that all of the work our coalition had done could be out the door
because of Suez,” says Eckel.
The fight to keep Baltimore’s water system public was back on.
“It was like we had to start it up all over again,” says Hathaway. “We knew we had to be taking a much
more proactive approach, a major structural change … something that would mean we could stop these
threats.”
Hathaway says what moved him to fight water privatization, first as a member of One Baltimore and
then as a member of the Right to Water Coalition, was the effect it could have on labor. “The real energy
came from the stories of members who worked for the Department of Public Works,” he says. “You
heard their stories of working overtime, extra work they did, getting up at night to have to deal with line
breaks.”
As president of City Union of Baltimore, a chapter of the American Federation of Teachers, Antoinette
Ryan-Johnson says she has 534 members of her local union chapter that work for the agency in charge
of Baltimore’s water system, the Department of Public Works.
“The fear is that if water was privatized … our members could lose their jobs,” says Ryan-Johnson.
Eckel points to research in support of those fears. A survey of 10 privatization contracts found that
after private entities took over a system, water companies reduced their workforce by 34 percent on
average. But she says not all residents are empathetic to the plight of these city workers.
“Some people in the community really feel like [the Department of Public Works] has really caused
harm and has really wronged so many people in the city that, why should we protect them as a public
utility? Why shouldn’t we let a corporation come in and have their shot,” Eckel says. “So many people
have said to me, it can’t be worse than what it is now.”
Well, according to a Food and Water Watch study, private companies actually charge close to 60
percent more for water than their public counterparts. In June 2018, Middletown, Pennsylvania
brought a lawsuit against its former solicitor and former financial consulting firm for advising the town
to enter into a 50-year agreement with Suez Environment for raising water rates by 11.5 percent.
Baltimore is already experiencing an affordability crisis. Another study by Food and Water Watch
shows that by 2019, half of all Baltimoreans won’t be able to afford their water bills, which have
increased by 33 percent since 2015.
The Department of Public Works says the extra funds are necessary to finance court-mandated repairs
to Baltimore’s to the aging sewage system. By some estimates, these repairs will cost two billion dollars.
Advocates in other cities are already hoping to follow in Baltimore’s footsteps.
Aly Shaw of the Pittsburgh Our Water Campaign says lead levels in her city are finally going down after
Pittsburgh regained public, democratic control of the water system. That Baltimore’s charter
amendment would outlaw not only selling but also leasing the public water system to a private
company under a public-private partnership, Shaw says, is crucial.
“We’re asking our own city council follow Baltimore’s lead,” Shaw says. “We simply cannot afford to
risk our public’s health again by entering into another public-private partnership.”
Eckel attributes the presumed success of the charter amendment to the support of a diverse coalition,
including groups like the AFL-CIO that have opposed her group on environmental bills.
“Everyone is impacted by water,” she says.
BECOME A NEXT CITY MEMBER TODAY
Dharna Noor is a producer and the Baltimore Bureau Managing Editor at the
Real News Network. In her reporting, Dharna focuses on environmental and
climate justice. She also works with Tubman House’s community farm in west
Baltimore and sings with the Canticle Singers. Her work has appeared in
publications such as Truthout, Popular Resistance, and Alternet.
FOLLOW DHARNA
TAGS: BALTIMORE, WATER, PRIVATIZATION


Middletown sues ex-solicitor and fiscal adviser;
claims it got costly bad advice on water system
deal
Posted Jun 8, 2018
Middletown is suing its former solicitor and legal advisor, alleging they missed a major error in the deal to lease
the borough water and sewer systems.(Dan Gleiter / The Patriot-News file)
By Matt Miller | [e-mail]

Middletown Borough is suing its ex-solicitor and former financial consultant, claiming they gave
council a bum steer when it agreed to lease the town's water and sewer systems in 2014.
That supposed bad advice is a main reason Suez Water is proposing to slap Middletown
customers with an 11.5 percent water rate increase, borough officials contend in the complaint filed in
Dauphin County Court this week.

The suit's targets are the law firm of McNees Wallace & Nurick and Susquehanna Group Advisors
Inc. Council replaced McNees as borough solicitor less than three months ago.
McNees spokeswoman Toshiko Macaluso said Friday that the firm would not comment on the suit.
The case against McNees and Susquehanna is being mounted simultaneously with a federal suit
the borough filed in an attempt to force a revision of the 50-year lease deal with Suez. McNees and
Susquehanna reportedly received several hundred thousand dollars in fees for their roles in
negotiating the Suez agreement.
Borough officials considered entering into that deal because they were facing a $3.3 million budget
shortfall, the suit states. Under the lease agreement, Suez paid the borough $43 million up front
and must pay another $725,000 annually.
The problem, borough officials contend, is that an incorrect benchmark for water usage is included
in the Suez deal. That benchmark includes bulk water sales to neighboring municipalit ies along
with regular sales to 2,623 customers. It only should include the regular sales to customers,
Middletown claims.
As a result of the supposed error, Suez now is claiming a shortfall in its guaranteed sales figure
and is seeking to recover it through higher customer fees, borough officials contend.
McNees and Susquehanna should have realized the claimed error and warned council, Middletown
officials contend. "Had the borough been adequately advised of the effect of the water sales
shortfall provision it would not have approved the lease agreement," the suit states.
Borough officials claim McNees admitted to council in March that it "made a mistake in not
understanding that bulk sales were included in the threshold." According to the suit, McNees
offered to keep representing the borough if council agreed not to sue the firm.

(http://www.realestateindepth.com/)

(http://www.wphospital.org/)
Rockland Sues State, Water Utility Over Desalination
Plant Costs
John Jordan | July 2016
From left, Rockland Assistant County Attorney Tom Simeti and Rockland County Executive Ed Day
NEW CITY— Rockland County Executive Ed Day announced on June 27th that the county had led a lawsuit against its water
company—Suez Water New York, Inc.—and two state agencies in connection with tens of millions of dollars in costs being charged
to Rockland County water ratepayers for a failed desalination plant in Haverstraw.
The legal action focuses on a reimbursement request by Suez, the county’s water company, has made to the Public Service
Commission. The lawsuit names the Public Service Commission, the New York State Department of Public Service and Suez Water
New York as defendants. The reimbursement for costs center on Suez Water New York’s predecessor United Water New York’s
failed desalination plant in Haverstraw. In 2014, the PSC ordered the water utility to discontinue its eorts to secure approval of the
project.
United Water New York had been seeking to secure approvals to build the “Haverstraw Water Supply” project based on Consent
Orders issued by the PSC in 2006 and 2010. However, the PSC in May 2013 announced it would hold hearings on the controversial
project as well as reassess whether the desalination plant was necessary due to forecasted water shortages in future years in
Rockland County.
While environmental groups, such as Scenic Hudson and Riverkeeper came out against the project, a host of business and building
trades interests came out in support of the venture at that time. In its decision handed down on Nov. 13, 2014, the PSC determined
that “due to changed circumstances there was no longer an immediate need for a new water supply source in United Water New
York’s service territory.”
The utility had sought to recover $52.1 million in costs related to the desalination plant project. The PSC later determined that $39.7
million in plant development costs could be recoverable. Suez is asking the Public Service Commission to approve an 18.7% rate
hike that would raise residential water bills $100 annually, Rockland County noted in its press announcement.
“Rockland residents should not be left holding the bag for an ill-advised and poorly managed project—especially one that no one
wanted and one that was ultimately shown to be unnecessary,” Rockland County Executive Day said.
In court documents led on Friday June 24th in New York State Supreme Court in Albany, Rockland County is asking for class
action status and court intervention.
“The Public Service Commission was supposed to be the watchdog for the consumer, making sure that the water company acted
responsibly,” Day said. “Suez did not act responsibly. The costs they are looking to have us pay are not just and reasonable.”
At a hearing asking the PSC for a surcharge, United Water submitted 9,532 pages of copies of schedules and invoices for legal and
other expenses related to the proposed Haverstraw desalination plant. In an order led on Feb. 25, 2016, the PSC reduced the
previously approved $39.7 million in plant costs for future recovery to $38,827,895.
“The State Department of Public Service did not verify these expenses,” Rockland County charges. The department merely
performed a sample audit of the invoices.” Rockland County Executive Day added, “We don’t even know what we are being asked
to pay for.”
William Madden, director of external aairs for Suez, said in a prepared statement, “SUEZ is proposing to recover its costs of
approximately $54 million associated with its long-term water supply project over a 20-year period. The New York State Public
Service Commission’s Feb. 25, 2016, Order concluded that $39 million incurred pursuing the Haverstraw Water Supply Project was
done so prudently. The Feb. 25, 2016 order is legally sound and the County of Rockland’s lawsuit is without merit.”
Madden tells Real Estate In-Depth that in addition to the $38.8 million in approved recoverable costs, there is another $14 million in
additional expenses yet to be reviewed by the PSC.
He added, “The record is unmistakably clear that the County of Rockland strongly advocated for the expedited development of a
long-term water supply project in the company’s 2006 and 2010 rate cases. To suggest otherwise is unfair and not supported by
the facts.”
In regards to the company’s rate ling with the PSC, Madden stated that its ling features a new rate structure that will lower bills for
20% of its customers and involve $150 million in infrastructure improvements over the next ve years.
Photo Caption From left, Rockland Assistant County Attorney Tom Simeti and Rockland County Executive Ed Day.
John Jordan
Editor, Real Estate In-Depth

Law firm advertises Hyannis water class-
action suit
Chuck Johnson, an operation and maintenance technician for Suez North America, loads cases of water last year at
the Barnstable Department of Public Works during a termporary advisory that cautioned residents in Hyannis,
Hyannisport and West Hyannisport against drinking town water. [Merrily Cassidy/Cape Cod Times file]
By Geoff Spillane
Posted Apr 7, 2017 at 6:12 PMUpdated Apr 7, 2017 at 6:12 PM

Lawsuit would be latest in growing web of legal action
based on contamination from firefighting foams.
HYANNIS — A Manhattan-based law firm is seeking clients who believe they may
have been poisoned by contamination of the Hyannis water supply.
Napoli Shkolnik, PLLC began running advertisements on Facebook this week in
connection with the planned class action. In addition, letters to residents and
businesses in the Hyannis Water District are being mailed, according to Louise
Caro, a partner in the firm who specializes in litigation involving exposure to
hazardous soil, water and air contaminants.
The firm has created a website for the potential action:
massachusettswater.napolilaw.com.
“It is not uncommon for these so-called mass tort law firms to reach out with
public announcements to identify potential clients,” Barnstable Assistant
Attorney Charles McLaughlin said.
Barnstable town officials have issued public health advisories for the Hyannis
water system twice since 2015. In both instances, levels of the perfluorinated
chemicals PFOS and PFOA above the U.S. Environmental Protection Agency
health advisory limits were found in wells serving 18,000 residents and
businesses in Hyannis, Hyannisport and West Hyannisport.
The chemicals are typically found in the types of firefighting foams that have been
used in the past at the Barnstable County Fire and Rescue Training Academy and
Barnstable Municipal Airport.
The temporary advisories warned pregnant women, nursing mothers and infants
to avoid consuming water from the public water supply. Carbon treatment
systems have since been installed and the water is again safe to drink, according
to town officials.
Perfluorinated chemicals have been linked to health problems that include
thyroid disorders, developmental effects on fetuses during pregnancy, liver
damage and testicular and kidney cancer.
“Residents of Hyannis have been unknowingly poisoned by the town water for
years. It is time that those responsible for making and releasing those
contaminants into our water system clean it up and help those people who
developed cancers,” read a Napoli Shkolnik Facebook ad that appeared online on
Wednesday. “Did you drink the water? Get started filing your claim today!”
Caro said she expects the filing of a class-action lawsuit, which has already been
drafted, to occur quickly.
“Once we start receiving responses, we will go to Hyannis and have a town hall-
style meeting with a toxicologist attending by Skype,” she said. “This can happen
very fast, in just a couple of weeks.”
While water advisories in the Hyannis water supply area have been issued only in
recent years, Caro suspects some residents may have had long-term exposure to
the contaminants, since firefighting foams containing the contaminants could
have been used for decades at the fire training academy and airport.
“We are looking back a long time for exposure,” Caro said. “We suspect it was
significant.”
She said there also are potential health dangers for those who drank the
contaminated water for only a short period of time.
“The damage can have a latency period,” Caro said. “People could get sick down
the line and develop conditions in the future. What the advisory talks about —
thyroid issues, testicular and kidney cancers — rings true. They are all
happening.”
Caro said the firm would pursue medical monitoring for litigants, enabling them
to receive screenings for most of their lives to catch any potential cancers at an
early, and hopefully treatable, stage.
Initially, the suit would be targeted toward the manufacturers of the firefighting
foams, including industrial giant 3M, but the town or county could also be added
as defendants, Caro said.
A Facebook ad posted by Napoli Shkolnik earlier this week referenced a 3M plant
on Cape Cod — a plant that never existed — as a source of the contamination, but
has since been corrected.
“I’m not surprised to see (the possible class-action lawsuit),” Barnstable County
Administrator John “Jack” Yunits, Jr. said. “When the EPA lowered the health
advisory levels to such a degree, this PFOS problem could become a PFOS
epidemic very quickly. In turn, that could be a boon for product liability lawsuits
across the country.”
According to the Napoli Shkolnik website, the firm is involved in similar cases in
Colorado, Delaware, New Hampshire, New York, Pennsylvania and Vermont.
If a class-action lawsuit is filed, it will be the latest in a web of active court cases
being pursued in the wake of the Hyannis water system contamination.
The town filed a lawsuit against the county last summer seeking several million
dollars in compensation for cleanup of the Hyannis wells.
“Negotiations are continuing,” McLaughlin said Thursday.
In addition, the town and county have filed separate lawsuits seeking damages
from vendors of firefighting foams containing the toxic chemicals.
Most recently, the county went a step further and added Entergy Nuclear
Generation Company, the Hyannis Fire District and the Barnstable County Fire
Chiefs Association — all users of the fire training academy — as defendants in the
case that has been brought by the town. Entergy owns the Pilgrim Nuclear Power
Station in Plymouth and trained at the fire and rescue training academy located
on South Flint Rock Road north of the airport.
— Follow Geoff Spillane on Twitter: @GSpillaneCCT

☰ Menu
INDONESIA
Jakarta: Suez environnement and water privatisation under trial
14 MARCH 2014
An unusual trial has recently begun in the Indonesian
capital: that of the water privatisation contract awarded
to Suez Environnement at the end of the Suharto
dictatorship in the 1990s. Fifteen years of private sector
management has not brought any improvement to the
lives of millions of Jakarta residents and their right to
clean water. Last year, the governor of Jakarta
announced his intention to return the water services to
the public sector. The civil society coalition which
initiated the lawsuit hopes to have the initial contract
simply cancelled, thus sparing the Jakarta administration a potentially costly buyout.
This article was originally published in French. Translation: Stephen Nichols.
The Jakarta contract is one of the last relics of the great wave of water privatisation in which occurred in the late
1990s in the Global South, and ended in a series of scandals and failures for water multinationals such as Suez and
Veolia. It was signed towards the end of the dictatorship period, in particularly dubious circumstances: until now,
some of its content is still kept secret. In more than fteen years, Suez has utterly failed to improve the water system,
extend access to water or resolve water quality problems. All the while, the public administration’s payouts and debt
towards the private concessionnaire were rising astronomically.
Last year, after a long campaign by residents, unions and civil society organisations, Joko “Jokowi” Widodo, the
governor of Jakarta, announced that the water services would come back under public management. He was
proposing to buy back Suez Environnement’s shares in the water operator, Palyja. Negotiations have been dragging
on since then.
Meanwhile, the Coalition of Jakarta Residents Opposing Water Privatization (KMMSAJ), initiated legal proceedings,
including a class-action lawsuit aiming to have the privatisation contract cancelled altogether – potentially avoiding
having to pay one single penny to Suez Environnement. According to the claimants, the contract was drawn up
illegally and it contravenes the Indonesian constitution’s provisions on basic services. A representative from the
Indonesian Commission on human rights said during the trial that the privatisation contract had caused human rights
violations.
The activists demand that Joko Widodo not enter into any agreement with Suez before the conclusion of this trial.
They fear that the Jakarta administration might unnecessarily pay large sums of money to Suez Environment, or that
it might even continue to use the services of the French rm indirectly (a solution which has been suggested by Suez
Previous Next
Environment itself). Such problems are frequently encountered in cases of water ’remunicipalisation’ (as has recently
occurred in Berlin, Germany).
The issue of the Jakarta water privatisation contract has, for several years, appeared regularly on the Franco-
Indonesian diplomatic agenda. It is politically sensitive for France, since GDF Suez, Suez Environnement’s parent
company, is involved in several major energy projects in Indonesia. On the other hand, Jakarta governor Joko
“Jokowi” Widodo is a poll favorite for winning the presidential elections that will take place in July this year in
Indonesia.
For more information about the history of water management by Suez Environnement in Jakarta, read our
investigation: Suez in Jakarta: fteen years of misfortune? (in French).
Olivier Petitjean
— 
Photo source: Antara Photo/M. Agung Rajasa

For more than two centuries, democratically controlled
public water systems across the United States have
been fundamental to meeting people’s most basic
needs, improving public health, and providing economic
opportunity for all. In fact, the U.S. Conference of
Mayors has reported that every dollar invested in water
and sewer systems reaps over $6 in the long term for
the economy at large.1 As federal investment in our
water systems has declined precipitously, corporations
like Veolia and Suez have marketed water privatization,
including in the form of “public-private partnerships”
(PPPs), as a solution to cities’ water woes. But case after
case shows that privatizing public water is risky business
for mayors, city governments, and residents.

FLINT, MICHIGAN

“Some people may be
sensitive to any water”
—Veolia to city of Flint, February 20152
PHOTO CREDIT: Imani on Unsplash
Double trouble:
Veolia, Suez, and
the risks of water privatization
CASE STUDIES: VEOLIA
In February 2015, at the height of the Flint lead crisis,
the city hired Veolia to address drinking water quality.3
Veolia declared Flint’s water safe, failed to warn the city
of possible lead contamination, and even recommended
a chemical change that the state alleges made the crisis
worsen.4 Michigan Attorney General Bill Schuette has
launched a lawsuit alleging professional negligence and
fraud,5 accusing Veolia of “callously and fraudulently”
dismissing medical concerns.6
PLYMOUTH, MASSACHUSETTS
Water privatization in the form of PPPs has led to:
• Significant rate hikes.
• Labor cuts and abuses.
• Serious health and safety violations.
• Dangerous cost cutting that puts public health in
jeopardy.
• Failure to invest in necessary infrastructure upgrades.
PUBLIC WATER WORKS
WATER PRIVATIZATION: A RAW DEAL
And the private water industry’s disastrous track record
in cities like Flint, Michigan; Pittsburgh, Pennsylvania;
and Plymouth, Massachusetts has generated widespread
public opposition to water privatization contracts across
the U.S.Under Veolia’s operation of the city’s wastewater
system, 10 million gallons of raw sewage flooded
Plymouth between December 2015 and January
2016, spurring a lawsuit by the state. In April 2018,
Massachusetts Attorney General Maura Healey
announced that Veolia will pay a $1.6 million
settlement.10
PITTSBURGH, PENNSYLVANIA
Following management contracts with Veolia,
Pittsburgh suffered its own lead crisis that continues to
endanger city residents. Under Veolia’s management of
the Pittsburgh Water and Sewer Authority, the corrosion
control chemical used to prevent lead contamination
was switched to a cheaper alternative without the
required approval, violating state regulations.7
Following the switch, lead levels exceeded
Environmental Protection Agency limits for the first
time in the authority’s history.8 Veolia walked away with
over $11 million.9 Meanwhile, local officials must find
hundreds of millions of dollars to replace pipes leaching
lead.

BAYONNE, NEW JERSEY

ENDNOTES
1Richard A. Krop, Charles Hernick, and Christopher Frantz, “Local Government Investment in Municipal Water and Sewer Infrastructure: Adding Value to the National Economy” (Washington, DC: The U.S. Conference of Mayors, August 14, 2008), 10.
2Interim Water Quality Report” (Veolia, February 18, 2015), 21, http://www.greatlakeslaw.org/Flint/Veolia_2015_Interim_Report.pdf.
3“Resolution to Veolia Water for Water Quality Consultant” (Office of the Emergency Manager Gerald Ambrose, February 4, 2015), http://www.greatlakeslaw.org/Flint/Veolia_Flint_Contract.pdf.
4“Water Quality Report” (Veolia North America, March 12, 2015), http://www.greatlakeslaw.org/Flint/Veolia_2015_Report.pdf; Attorney General Bill Schuette et al., “Complaint for Damages and Demand for Jury Trial” (State of Michigan Circuit Court of the County of Genesee), 22-23, https://www.michigan.gov/documents/ag/Veolia_LAN_Complaint_539723_7.pdf.
5Attorney General Bill Schuette et al., “Complaint for Damages and Demand for Jury Trial.”
6Merrit Kennedy, “‘They Made It Worse’: Michigan Sues 2 Companies Over Flint Crisis,” NPR, June 22, 2016, https://www.npr.org/sections/thetwo-way/2016/06/22/483083095/they-made-it-worse-michigan-files-suit-against-2-companies-over-flint-crisis.
7Michael E. Lamb et al., “Performance Audit: Pittsburgh Water and Sewer Authority” (Pittsburgh, Pennsylvania: Office of City Controller, June 2017), 60–61, http://apps.pittsburghpa.gov/co/Pittsburgh_Water_and_Sewer_Authority_June_2017.pdf.
8”PWSA 2016 Lead Test Results,” Pittsburgh Water and Sewer Authority, July 22, 2016, http://www.pgh2o.com/release?id=6278; “Actions Related to Pittsburgh Water and Sewer Authority” (Pennsylvania Department of Environmental Protection, April 25, 2016), 6, http://files.dep.state.pa.us/RegionalResources/SWRO/SWROPortalFiles/PWSA/DEP%20Cites%20PWSA%20Webinar%2004252016%201200.pdf.
9Michael E. Lamb et al., “Performance Audit: Pittsburgh Water and Sewer Authority,” 11.
10 Office of Attorney General Maura Healey and Massachusetts Department of Environmental Protection, “Veolia to Pay $1.6 Million for Massive Sewage Spills, Discharges Causing Shellfish Bed Closures in Plymouth Harbor,” Mass.gov, April 10, 2018, https://www.mass.gov/news/veolia-to-pay-16-million-for-massive-sewage-spills-discharges-causing-shellfish-bed-closures.
11Danielle Ivory, Ben Protess, and Griff Palmer, “In American Towns, Private Profits From Public Works,” The New York Times, December 24, 2016, http://www.nytimes.com/2016/12/24/business/dealbook/private-equity-water.html.
12Robert Brum, “Expert: United Water System, and Its Books, Leak Badly,” The Journal News, June 30, 2015, https://www.lohud.com/story/news/local/rockland/2015/06/30/report-united-water-system-books-leak-badly/29530933/.
13Steve Lieberman and Robert Brum, “Rockland County Sues State, Suez over Desalination Costs,” The Journal News, June 27, 2016, https://www.lohud.com/story/news/local/rockland/2016/06/27/rockland-sues-suez/86347974/.
14Office of Attorney General Maura Healey and Massachusetts Department of Environmental Protection.
CASE STUDIES: SUEZ

“By failing to properly maintain
and operate wastewater treatment
facilities, companies like Veolia are
not only violating the law, they are
threatening public health and our
invaluable coastal water resources.”
—Massachusetts Attorney General Maura Healey
on Veolia in Plymouth.14
RECOMMENDATIONS
These examples, and countless others, make abundantly
clear that public-private partnerships do not solve water
infrastructure problems—they exacerbate them.
Rather than turning to the private water industry to
solve water system challenges, elected officials should
implement solutions that maintain strong public water
systems that are accountable to people and focused on
equitable, affordable water service for all.
For resources on public solutions, taking back control of
privatized water systems, and the private water industry
please contact Corporate Accountability.
In Rockland County, Suez has come under fire over
serious concerns about the quality of water service
and conservation.12 Suez even sought to boost profits
through its attempt to build an unwanted desalination
plant. Although the plant was deemed unnecessary and
never built, Suez is trying to recoup tens of millions of
dollars in alleged pre-construction costs by charging
ratepayers across the region.13
In Bayonne, a PPP deal involving Suez and private equity
firm KKR has left residents with skyrocketing rates. The
$150 million upfront payment the city received has
come at a very high price to ratepayers who are not only
paying back that massive sum, but also paying the added
cost of investment returns the private sector demands.
Some residents struggling to pay their water bills—with
rates already increased by nearly 28 percent—have
even had liens placed on their homes that could lead to
foreclosure.11
It’s no surprise that this contract model, which Suez is
widely marketing, was the subject of a scathing New
York Times investigation.
ROCKLAND COUNTY, NEW YORK
CorporateAccountability.org
617.695.2525
10 Milk Street, Suite 610
Boston, MA 02108
STATE OF NEW JERSEY
Board of Public Utilities
Agenda Date: 7/29/16
Agenda Item: 7 A
44 South Clinton Avenue, 3'd Floor, Suite 314
Post Office Box 350
BIANCA CORTES,
Petitioner,
v.
Trenton, New Jersey 08625-0350
www.nj.gov/bpu/
SUEZ WATER NEW JERSEY, INC.,1
Respondent.
)
)
)
)
)
)
)
)
Parties of Record:
CUSTOMER ASSISTANCE
ORDER ADOPTING THE
INITIAL DECISION, IN PART,
AND REMANDING TO THE OAL
FOR A SECOND EVIDENTIARY
HEARING
BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
Jonah B. Kimmelstiel, Esq., on behalf of Petitioner, Bianca Cortes
John P. Wallace, Esq., on behalf of Respondent, Suez Water New Jersey, Inc.
BY THE BOARD:
On March 18, 2014, Bianca Cortes ("Petitioner") filed a petition with the Board of Public Utilities
("Board") disputing water usage and service charges provided by Suez Water New Jersey, Inc.
("Respondent" or "Company"). The matter was transmitted to the Office of Administrative Law
("OAL") as a contested case. Following an evidentiary hearing, Administrative Law Judge
("ALJ") Leland S. McGee issued an Initial Decision. Having reviewed the record, the Board, for
the reasons stated below, adopts the Initial Decision, in part, and remands the matter to the
OAL for a second evidentiary hearing.
BACKGROUND
By the complaint, Petitioner alleges that she had mistakenly received a high bill in the amount of
over $3,000 in 2011. She stated she had contacted the Company, and was advised that the bill
was a result of over nine years of estimated meter reads. She said she paid the bill. In October
2012, Petitioner claims she received a second higher bill in the amount of $8,790. Petitioner
states she was placed on a payment plan to prevent a shut off, complaining that a minor drip
from the front and rear spigots could not have produced such high billings.
1 On January 27, 2016, United Water, Inc. changed its operating name to SUEZ Water New Jersey, Inc.
After the filing of Respondent's answer on May 13, 2014, the Board transmitted this matter to
the OAL for hearing and initial disposition as a contested case pursuant to N.J.S.A. 52:148-1 et
seq. and N.J.S.A. 52:14F-1 et seq. The matter was assigned to ALJ McGee. While the matter
was pending at the OAL, Petitioner failed to appear at an August 25, 2014 hearing and the
matter was returned to the Board. Petitioner thereafter requested a new hearing date, stating
she lacked notice. The matter was re-transmitted to the OAL. A prehearing conference was
held on October 30, 2014. The evidentiary hearing, initially scheduled for March 16, 2015, was
adjourned at the request of the parties.
On December 17, 2015, the evidentiary hearing was held before the ALJ. Petitioner testified on
her own behalf. Respondent presented the testimony of three company representatives:
Vanessa Garcia, the present assistant emergency inspector who acted in the capacity of a
customer services field representative in this matter; Roy Hill, the customer service field
representative; and Kathleen Ofeldt, the manager of customer operations. The record before
the OAL consisted of a transcript of the evidentiary hearing and nineteen (19} exhibits admitted
during the evidentiary hearing including a ledger prepared by the Company, utility invoices to
the Petitioner, a field order, and water meter test results.
Petitioner testified to multiple billing charges and payments from 2011 to 2015, disputing
charges from 2011 to 2012 and alleging an overpayment was made. Petitioner referenced a
ledger which was received by her attorney from Respondent's attorney. The ledger was
introduced during the direct examination of Petitioner. Petitioner thereafter continued providing
testimony on five bills for the period in question from 2011 to 2012. She testified her May 26,
2011 estimated bill reflected a $36.25 charge for 3,750 gallons of water usage and the bill itself
reflected a past due balance of $487.60 on the accour~t. Petitioner testified her August 29, 2011
estimated bill reflected a $2,190.48 charge for 156,000 gallons of water usage. Petitioner
testified to a February 24, 2012 actual bill for $363.59 in charges and a June 1, 2012 estimated
bill for $357.56 in charges. Petitioner then testified her October 6, 2012 prorated actual bill
reflected a $7,094.90 charge for 1,329,196 gallons of water usage. She testified the June 2012
and October 2012 bills covered an overlapping period. Petitioner further testified to a November
28, 2012 bill in the amount of $67.31 and stated she was placed on a payment plan for the
outstanding $1,986.32 amount. Petitioner specifically questioned two bills in dispute -the ·
August 29, 2011 estimated bill for $2,190.48 and the October 6, 2012 prorated actual bill for
$7,094.90. Petitioner acknowledged that the amount of $7,245.49 was listed as a carry forward
balance on the August 26, 2014 bill. Petitioner also testified that a device was installed in the
fall of 2011 and the meter was replaced on October 22, 2012. Petitioner further testified, on
cross-examination, to noticing water pooling below the spigots during the customer service
investigation.
Ms. Garcia testified to conducting a customer service investigation on the removal of meter no.
88500657 on October 22, 2012. During her investigation, Ms. Garcia noticed leaking at the
front and back spigots. She clarified that she saw a leak, not a drip or pooling, on the property.
Ms. Garcia observed the meter to be spinning from leakage and testified that, under those
circumstances, she would normally have notified the customer to get a plumber. She noted
documentation reflected meter no. 88500657 was installed on September 12, 2011.
Mr. Hill testified to conducting testing on meter no. 88500657 on October 25, 2012. He stated
the meter did not register on a slow test, but it registered within meter accuracy limits on the
medium test at 99.0% and on the high test at 99.2%. Mr. Hill testified the meter replacement
was not done due to the low flow test result, but because the one-year-old meter was an older
model which was scheduled to be replaced by a newer model. On cross-examination, however,
2 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
Mr. Hill testified the Company was concerned the meter was not reliable because it was not
registering low flow and that amounted to a loss of revenue to the Company. Mr. Hill confirmed
the meter was held for thirty (30) days then destroyed.
Ms. Ofeldt testified to her review of billings on the customer account, stating bills were issued
quarterly in 2011 and monthly thereafter. Ms. Ofeldt reviewed the August 29, 2011 bill amount
of $2, 190.48 and testified the current balance was not reflected on the ledger, therefore she
surmised that the bill had been cancelled. Ms. Ofeldt acknowledged there was a previous
balance on the August 29, 2011 bill that was not reflected on the ledger, stating there were
inconsistencies between the ledger and Company invoices for August 29, 2011 and November
28, 2012. Ms. Ofeldt reviewed the November 8, 2012 bill in the amount of $1 ,986.32, noting the
meter had been replaced on October 22, 2012, but testified she did not know if that billing had
been generated on the old or new meter. On the November 28, 2012 bill, Ms. Ofeldt testified
the previous balance of $8,723.00 was not carried over. Ms. Ofeldt described the ledger as a
doc.ument which was manually created for the hearing. She indicated that the ledger is not a
document which was printed off Respondent's system; therefore, she could not authenticate
anything on the ledger and that she would have to review the Company's billing system.
A motion to dismiss was submitted by Respondent on February 2, 2016. Respondent argued
Petitioner failed to sustain the burden of proof on the disputed 2011 charge since the bill had
been cancelled, as reflected in Ms. Ofeldt's testimony. Further, the disputed October and
November 2012 billings reflected increased consumption due to water leakage on an accurate
meter, therefore Petitioner's. improper billing claims were unsupported. Respondent opposed
the credit request and sought dismissal of the petition. Petitioner did not respond to the motion.
The record was maintained as open for submission of post-hearing briefs until Apri114, 2016.2
The ALJ issued an Initial Decision on May 4, 2016 and did not rule on the motion to dismiss.
The Initial Decision addressed the meter investigation and billing charges. The ALJ found meter
no. 88500657 was removed and tested in October 2012 by Respondent using standard Board
methodology and practices, where the result did not support a finding that the meter registered
more consumption than what was delivered to the customer. The ALJ further found Petitioner
did not present any expert testimony or other evidence supporting that the meter measurements
for the period were inaccurate or should be completely disregarded. The ALJ therefore
concluded Petitioner had not met the burden of proof that the meter was inaccurately measuring
consumption.
The ALJ additionally found Petitioner had received an unusually high quarterly estimated bill in
February 2011 prior to the October 2012 meter replacement. The ALJ further found Petitioner's
regular monthly bills ranged between $30 to $70 after the October 2012 meter replacement. As
Petitioner had testified her August 29, 2011 estimated bill reflected a $2,190.48 charge and Ms.
Ofeldt reviewed the August 29, 2011 bill and testified the current balance was not reflected, the
ALJ found the August 20, 2011 bill for $2,190.48 was cancelled. The ALJ further found
Petitioner had not claimed a specific amount due or to be credited, therefore the ALJ found
insufficient evidence in the record to support a reduction in billing amounts.
While the ALJ determined Petitioner's proofs were insufficient on amounts, the ALJ was
additionally troubled by the accuracy of the Company's records, and, therefore, the Initial
2 Respondent filed its post-hearing brief on February 2, 2016. Petitioner sent a letter on February 26,
2016, requesting an extension of time to file a post-hearing brief until March 4. But, Petitioner did not file
its post-hearing brief by April14, 2016, the date of record closure.
3 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
Decision does not dispose of all issues in controversy. Specifically, the Initial Decision does not
resolve the billing and payment obligations for the January 2011 to December 2012 period.
Following a review of all testimony and exhibits submitted concerning Company invoices and
payments from January 19, 2011 to December 9, 2015, the ALJ found sufficient evidence to
question the accuracy of Respondent's bills based upon estimated bills, overlapping time
periods, and billing gaps. The ALJ also concluded there was not enough evidence to reflect the
actual amounts paid by Petitioner. Accordingly, the ALJ ordered that within thirty (30) days of
the date of the Final Decision, Respondent shall reconcile the discrepancy in bills issued for the
period beginning January 2011 through October 2012 and Petitioner shall submit a specific
amount claimed as overbilled and to provide the basis for that conclusion. The ALJ further
ordered that ifthe Petitioner and Respondent do not reach an agreement within forty-five (45)
days of the date of the Final Decision, Petitioner may thereafter file a billing dispute claim for the
specific amount determined to be improperly billed.
Petitioner filed exceptions to the Initial Decision on May 18, 2016, challenging the finding that
there was a lack of evidence supporting meter inaccuracy. Petitioner re-iterates there were no
changes in her household use, there were no leaks to the property, and the two minor leaks
identified were left over water in the spigots. Petitioner also argues Mr. Hill's testimony that the
meter was changed to a newer model after failing one of three accuracy tests supports the
meter inaccuracy argument. Petitioner argues the ALJ incorrectly concluded Petitioner had
failed to produce expert testimony on meter measurements because the failure to produce
should be disregarded where Respondent destroyed the meter.
Respondent replied to Petitioner's exceptions on May 23, 2016. Respondent contends the ALJ
correctly determined that Petitioner failed to produce meter inaccuracy evidence. Respondent
argues two bills (May 26, 2011 for 3, 750 gallons of water usage and August 29, 2011 for
156,000 gallons of water usage) reflect consumption prior to the installation of meter no.
88500657 on September 12, 2011. Respondent contends Petitioner's consumption history
reflects high usage prior to the October 2012 meter removal. Further, Mr. Hill testified that
meter no. 88500657 was accurate and the Company was losing revenue as a result of the
meter. Respondent, therefore, argues Petitioner's exceptions be rejected and the Initial
Decision be modified to dismiss the petition.
Respondent filed exceptions on May 20, 2016. Respondent generally argues the ALJ erred, as
the decision did not dispose of all issues required by N.J.A.C. 1:1-18.1(b) because, instead of
deciding the case, the order directs the parties to prepare additional data to allow for resolution
otherwise a billing dispute claim may be re-filed. Respondent argues Petitioner's failure to
establish inaccurate consumption on the meter reflects there was no overcharge. Challenging
the ALJ's finding regarding the accuracy of Respondent's billing, Respondent notes that the ALJ
did not articulate what evidence there was to support that finding and further states that there
were five bills in evidence from January 2011 to October 2012. Respondent claims the ALJ
found insufficient evidence to support a reduction in bills where Petitioner bore the burden of
proof and therefore this finding requires that the petition be dismissed. Respondent argues
Petitioner's failure to furnish additional data prior to the record closure required the ALJ to enter
a decision based on the existing record.
Petitioner submitted no reply to Respondent's exceptions. Pursuant to N.J.S.A. 52:14B-10(c),
the Board issued an order on May 26, 2016, extending its time to issue a final agency decision
by August 2, 2016.
4 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
DISCUSSION
After review and consideration of the entire record, including the arguments raised in the
exceptions and reply to exceptions, the Board HEREBY ADOPTS the Initial Decision, in part,
and REMANDS the matter to the OAL for a second evidentiary hearing.
The Board FINDS that the ALJ's conclusion that Petitioner had not met the burden of proof on
the meter inaccurately measuring consumption is proper and supported by the record.
Petitioner bears the burden of proof by a preponderance of the believable evidence in
proceedings before an administrative agency and factual determinations of the administrative
agency are generally sustained if supported by substantial evidence on the whole record.
Atkinson v. Parsekian, 37 N.J. 143, 149 (1962). If a customer has a complaint filed with the
Board regarding the accuracy or performance of the meter, the company shall not remove the
customer's meter from service during the pendency of said complaint, or during the thirty (30)
days following the Board's decision on the complaint, unless otherwise authorized by the
Board's staff. N.J.A.C. 14:3-4.8. N.J.A.C. 14:3-4.7 sets forth meter test reporting requirements.
And when a meter test is conducted, the water meter shall be tested with water flowing at both
intermediate and full flow capacities and it is considered accurate if it shows an error of no
greater than one and one half percent when tested. N.J.A.C. 14:3-4.5(d); N.J.A.C. 14:9-
4.1(c)(d). If a meter is found to be registering less than 100 percent of the service provided, the
utility shall not adjust the charges retrospectively or require the customer to repay the amount
undercharged, except if (1) the meter was tampered with, or other theft of the utility service has
been proven; (2) the meter failed to register at all; or (3) the circumstances are such that the
customer should reasonably have known that the bill did not reflect actual usage. N.J.A.C.
14:3-4.6. Where the meter fails to register or the customer should reasonably have known the
bill did not reflect actual usage, the customer shall be allowed to amortize the payments for a
period of time equal to that period of time during which the customer was undercharged.
N.J.A.C. 14:3-4.6(f). When the amount of a water bill is significantly higher than the customer's
established consumption history, and there is no apparent explanation for the increase, the
customer's established consumption shall be given consideration, in addition to the results of
any tests on the customer's meter, in evaluation of whether the bill is correct and appropriate
consistent with N.J.A.C. 14:3-7.6(g).
Petitioner submits exceptions, challenging the ALJ's proof determination and arguing no
changes in household water usage existed, the two leaks were minor, and the meter was
changed to a newer model after failing one of three accuracy tests. But the record reflects
otherwise. The billings of May 26, 2011 and August 29, 2011 reflect previously billed household
water consumption charges prior to the replaced meter's installation on September 12, 2011.
The leaks and water pooling were acknowledged by both the customer and the Company.
Additionally, while Petitioner argues he"r failure to produce expert meter measurement testimony
should be disregarded because Respondent destroyed the meter, this is not the standard. The
utility is prohibited from removing the customer's meter from service during the pendency of a
complaint pursuant to N.J.A.C. 14:3-4.8. However; when the utility does not receive a petition
challenging meter inaccuracy until the day the meter is removed, the utility could not have
known of the issue. Egeolu v. PSE&G, OAL Dkt No. PUC 08977-11, 6-7 (2011). This complaint
was filed on March 18, 2014, nearly a year-and-a-half after the investigation and removal of the
subject meter. The Company removed the meter before it knew the petition would be filed so its
meter removal is irrelevant to the methodology used to obtain meter test results. The record
reflects the removed meter was tested and registered within one percent of accuracy limits on
5 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
the medium test at 99.0% and the high flow test at 99.2%, as required by N.J.A.C. 14:9-
4.1 (c)( d). While meter error regulations allow for the adjustment of charges, this meter was
found to be registering less than 100 percent of the service provided, therefore the utility is not
required to adjust the charges retrospectively or require the customer to repay the amount
undercharged. N.J.A.C. 14:3-4.6(a). The record reflects the Company was losing revenue due
to the slow test.
The ALJ found that meter no. 88500657 was tested by Respondent using standard Board
methodology and practices, but the result did not support a finding that the meter registered
more consumption than what was delivered to the customer. Based on the record, there is no
reason to disturb the ALJ's finding that Petitioner did not present expert testimony on inaccurate
meter measurements to support the January to December 2011 or other period. The Board
FINDS the ALJ's findings and conclusions on household water consumption history, the
existence of leaks affecting consumption, and the accuracy of meter measurements are
reasonable and consistent with law. Accordingly, the Board ADOPTS the conclusion that
Petitioner did not meet the burden of proof that the meter was inaccurately measuring
consumption; therefore, Petitioner's exceptions are REJECTED.
In a billing dispute, the ALJ's function is to create a record which identifies whether a customer
was improperly charged for excess usage, whether the customer suffered any losses as a result
· of billing problems, and whether any billing adjustments made by the utility were reasonable and
appropriate under the circumstances. Reed v. Atlantic City Electric Company, OAL Dkt No.
PUC 10976-10, 10-11 (2012). N.J.A.C. 1:1-18.1(3)(b) requires an initial decision to be final in
form and fully dispositive of all issues in the case. However, no substantive findings of fact or
conclusion of law, nor any" concluding order or other disposition shall be binding upon the
agency head. N.J.A.C. 1 :1-18.1(3)(c). Further, N.J.A.C. 1:1-18.7 allows an agency head to
enter an order remanding a contested case to the OAL for further action on issues or arguments
not previously raised or incompletely considered. To the credit of the ALJ, the record
establishes essential facts that Petitioner is the customer of record and that the period in dispute
is from January 2011 through October 2012.
The Board further FINDS that the ALJ determination of insufficient evidence in the record to
support a reduction in billing amounts, as Petitioner had not claimed a specific amount due or to
be credited, is proper and supported by the record. The Initial Decision ordered Respondent to
reconcile the discrepancy in bills issued for the period beginning January 2011 through October
2012 and orde.red Petitioner to submit a specific amount claimed as overbilled within thirty (30)
days of the date of the Final Decision, allowing Petitioner to thereafter file a billing dispute claim
within forty-five (45) days if the dispute between the parties was not settled. While the unusual
decision directs the parties to prepare additional data following the issuance of a final agency
order, Petitioner was noticed of the insufficient record to support a billing reduction at the
conclusion of the hearing and in the Initial Decision. While Petitioner filed exceptions, the
exceptions focused on the accuracy of the meter. Petitioner argued that because the record
reflected that there was no change in her household's makeup, that the bills generated were
above her average usage, and that a Company's witness testified that the meter was unreliable,
the meter measurements over and above the average usage should be disregarded. However,
no calculation excluding the above average consumption was provided to the ALJ. Likewise,
the record is devoid of evidence showing all debits and credits on Petitioner's account. Had
such evidence been provided prior to the issuance of the Initial Decision, the Board would have
had the benefit of the ALJ's more complete analysis and recommendations. Petitioner did not
bear the burden of proof on reducing billing amounts. The Board therefore AFFIRMS the ALJ
determination on insufficient evidence in the record to support a reduction in billing amounts as
6 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
reasonable and consistent with law. Accordingly, the Board ADOPTS the conclusion that there
is insufficient evidence in the record, at this time, to support a reduction in billing amounts.
However, because the Initial Decision directed the parties to supplement the proofs after the
issuance of the final agency order and because this matter will be remanded to the OAL,
Petitioner will have an opportunity to submit evidence regarding payments made by her during
the January 2011 through October 2012 period.
The Board further FINDS that the ALJ determination that sufficient evidence exists to question
estimated billing accuracy, overlapping time. p~riods, and billing gaps from January 2011 to
October 2012 to be proper and supported by the record. The record, including the ledger and
testimony on the ledger and bills, reflects inconsistencies with billings and payments concerning
invoices or ledger entries dated August 29, 2011, February 29, 2012, October 6, 2012,
November 8, 2012, November 26, 2012, and November 28, 2012-and requires clarification.
Respondent has submitted exceptions, generally arguing the decision did not dispose of all
issues required by N.J.A.C. 1:1-18.1(b) because the order directs the parties to prepare
additional data to allow for resolution otherwise a billing dispute claim may be re-filed. Petitioner
did not reply to Respondent's exceptions. While sufficient evidence normally precedes the
issuance of an Initial Decision, the ledger prepared by the Company was not reflective of all
amounts billed and all payments made on the customer account for the period in question.
Therefore, the lack of necessary additional data precluded adequate consideration of the issue
by the ALJ.
By exceptions, Respondent specifically argues Petitioner's failure to establish inaccurate
consumption on the meter reflects there was no overcharge. However, the accuracy of a meter
measurement is not reflective of a billing over-or-under' charge. Respondent further states there
were five bills in evidence from January 2011 to October 2012. Yet the record reveals the five
bills furnished from January 2011 to October 2012 are not a full and complete record of all
billings and payments during this period, as testimony reflects there was a previous balance on
the August 29, 2011 bill that was not reflected on the ledger and there were inconsistencies
between the ledger and Company invoices on multiple dates through November 28, 2012. By
exceptions, Respondent claims the ALJ found insufficient evidence in the record to support a
reduction in bills where Petitioner bore the burden of proof, requiring petition dismissal. But the
finding of insufficient evidence to reduce a customer bill alone is not a sound basis for petition
dismissal where the merits involve additional unresolved billing and payment issues.
Respondent argues Petitioner's failure to furnish additional data prior to the close of the record
on April14, 2016 required the ALJ to enter a decision based on the record at that time. Yet, the
ALJ did enter an Initial Decision following closure of the record on April14, 2016.
The Board therefore AFFIRMS the ALJ's finding that there is sufficient evidence to question the
accuracy of the estimated bills issued, overlapping time periods, and billing gaps from January
2011 to October 2012 as reasonable and consistent with law. Accordingly, the Board ADOPTS
the conclusion that that the majority of bills during the period in question were estimates with no
explanation for the increase in billed charges and that evidence was insufficient to reflect the
actual amounts paid by Petitioner, therefore Respondent's exceptions in this regard are
REJECTED.
The Board FINDS that it does not have a complete record on which to base further fact findings
necessary to resolve all issues in this case. Having reviewed the entire record, the Board notes
that the issue of whether all billing amounts and payments were made on the customer account
from January 2011 to October 2012 remains outstanding. Therefore, the Board, pursuant to
7 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
/
N.J.A.C. 1:1-18.7(a), REMANDS the matter to the OAL for further findings of fact to fully
dispose of all issues in the case consistent with N.J.A.C. 1:1-18.1(3)(b). By a second
evidentiary hearing, the ALJ is to further develop the record showing all amounts billed and all
payments posted on the customer account beginning January 1, 2011 and ending December
31, 2012. The ALJ is to determine whether there was an overpayment, and if so, then the
reason for the overpayment, the amount of the overpayment and how the overpayment was
calculated. The ALJ is to further determine whether there were any credits issued by
Respondent and, if so, then whether those credits were issued in accordance with its tariff. The
ALJ is also to make a determination whether any amount is due and owing to Respondent.
The effective date of this order is August 8, 2016.
DATED: \\2 ~\\I.e
/
ATIEST:
I HEREBY CERTlfY that tilt wllhl•
document Is a true <""' of tilt Ollglnal In the files of the Board of Public Utlllllel
c.Q...LA-77
'
BOARD OF PUBLIC UTILITIES
BY:
( ~~ ~f.lo.fd.~A--J ~NAHOLDEN
C MMISSIONER
~-C:.~
lJPDRAiCHIVUKULA
COMMISSIONER
8 BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
BIANCA CORTES
vs.
SUEZ WATER NEW JERSEY, INC.
BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
Bianca Cortes
31 Marion Road
Montvale, New Jersey 07645
Jonah B. Kimmelstiel, Esq.
2 University Plaza, Suite 101
Hackensack, New Jersey 07601
John P. Wallace, Esq.
171 East Ridgewood Avenue
Ridgewood, New Jersey 07450
[e-mail]
Veronica Beke, DAG
Department of Law & Public Safety
Division of Law
124 Halsey Street
Post Office Box 45029
Newark, NJ 07101-45029
[e-mail]
SERVICE LIST
9
Irene Kim Asbury, Esq.
Secretary of the Board
Board of Public Utilities
44 South Clinton Avenue, 3'd Floor, Suite 314
Post Office Box 350
Trenton, NJ 08625-0350
[e-mail]
Eric Hartsfield, Director
Division of Customer Assistance
Board of Public Utilities
44 South Clinton Avenue, 3rd Floor, Suite 314
Post Office Box 350
Trenton, NJ 08625-0350
[e-mail]
Julie Ford-Williams, Chief
Division of Customer Assistance
Board of Public Utilities
44 South Clinton Avenue, 3rd Floor, Suite 314
Post Office Box 350
Trenton, NJ 08625-0350
[e-mail]
BPU DOCKET NO. WC14030248U
OAL DOCKET NO. PUC 11838-14
-;.·
-· .. RECEIVED
MAY 0 4 2016
State of New Jersey
OFFICE OF ADMINISTRATIVE LAW
BOARD OF PUBLIC UTILITIES
MAIL ROOM
BIANCA CORTES,
Petitioner,
v.
UNITED WATER NEW JERSEY,
Respondent.
INITIAL DECISION
OAL DKT. NO. PUC 11838-14
AGENCY DKT. NO. WC14030248U
ON REMAND
OAL OKT. NO. PUC 07824-14
AGENCY DKT. NO. WC14030248U
Jonah B. Kimmelstiel, Esq., for petitioner (Law Office of Jonah B. Kimmelstiel,
attorneys)
tW~~
v' 1-/4~ YJe)
b. Lee.1h~WJ.I
6. t+?,..f~dq
:r.~ .
John P. Wallace, Esq., for respondent
Record Closed: April14, 2016 Decided: May 4, 2016
BEFORE LELAND S. MCGEE, ALJ:
PROCEDURAL HISTORY
~t:;·J:q:fclq...,.
f-.Lqm~
13. As~
:J'. Ge..-t.S;'Ylq,._
c. v~:e..--
On September 16, 2014, this matter was transmitted to the Office of Administrative
Law (OAL) for hearing as a contested case pursuant to N.J.S.A. 52:14B-1 to -15 and
N.J.S.A. 52:14F-1 to -13. This matter is a Remand of OAL Docket No. PUC 07824-14
that was previously dismissed due to a failure to appear.
Nell' Jersey is an Equal Opportunity Employer
OAL DKT. NO. PUC 11838-14
A prehearing conference was held on October 30, 2014. An Evidentiary Hearing
was scheduled for March 16, 2015, which was adjourned at petitioner's request. A
hearing was scheduled for July 28, 2015, which was adjourned at respondent's request.
An Evidentiary Hearing was held on December 17, 2015, and the record was left open
for submission of post-hearing briefs. On February 2, 2016, respondent filed its post­
hearing brief. On February 26, 2016, petitioner sent a letter via facsimile dated
February 26, 2015, and requested an extension of time to file a post-hearing brief until
"March 4." Petitioner has not filed a post-hearing brief and the record closed April 14,
2016.
FACTS
Petitioner filed a petition alleging that respondent overcharged her in calendar
year 2011 in amount that exceeded $3,000, after her water meter had been replaced
with a new one. She alleged that her usual bill was $36.25 "more or less." The petition
alleged that respondent's explanation was that for nine years she received estimated
bills.
The petition alleged that in October 2012 petitioner received a bill in the amount
of $8,790. Following an inquiry about the reason for such a high bill, one of
respondent's employees came to conduct a full investigation on October 12, 2012. The
investigator advised petitioner that the front and rear water spigots were dripping water
but that there was no evidence of any reason for such a high bill. The investigator
replaced the meter and petitioner later received a report that the old meter operated
properly.
The petition alleged that Petitioner was placed on a payment plan of $100 per
month to partially pay the bill up to $1 ,973.24. Since the meter was changed, her water
bills returned to a "reasonable monthly amount."
The petition alleged that there is no pool, sprinkler system or anything else on the
property that could cause the water bills to increase to such high amounts and she
2
OAL DKT. NO. PUC 11838-14
never used a volume of water that would result in such high bill amounts. ·
Attached to, and made a part of, the petition are two water bills dated February
10, 2014, in the amount of $7,600.01, and February 25, 2014, in the amount of
$7,795.45, respectively.
Summarv of the Testimony
There were four witnesses in this case. Petitioner testified on her on behalf.
Bianca Cortes
Bianca Cortes (Cortes) has resided at the subject premises for thirteen (13)
years. Her husband, her mother, and step-father have lived with her at the home. In
July 2014, her child was born. In 2011, her mother and step-father stayed with them
primarily during the winter months; otherwise lived in their own home in Sussex County,
New Jersey. Cortes's husband works for the Bergen County Sheriff's Office eight hours
per day, as does she. Her step-father works six to seven hours per day. There are only
two showers in the house-no swimming pool or sprinkler system. Cortes is the only
owner of the house, which has only been used a residence and no business has been
operated out of it. The lot size is 200 x 125, and in 2011 she watered the lawn with a
hose in the summer. There were no leaks in the water heater; there was no damage as
a result of Super Storm Sandy; and there are no damaged pipes in the home.
In the beginning of the year 2011, Cortes received a large bill in excess of
$2,000. At the time she had been receiving quarterly bills and they ranged from $40 -
$60. Cortes described the series of bills that she received:
February 24, 2011 -reflected on the ledger, Exhibit P-1; current charges $89.66.
May 26, 2011 -88 days from 2/22/11 -5/21/11; current charges $36.25; past
due balance of $487.60; estimated bill. (P-2.)
August 29, 2011 -95 days from 5/21/11 -8/24/11; current charges $2, 190.48;
estimated bill. (P-3.) Cortes stated that she paid the bill in full.
3
OAL DKT. NO. PUC 11838-14
September 16, 2011 -reflected on the ledger, P-1; in the amount of $350.95.
Cortes did not receive this bill.
February 29, 2012-96 days from 11/23/11 -2/27/12; current charges $363.59;
actual meter reading. (P-4.)
Cortes stated that it was during this time that an investigator came to inspect her
meter and house. She was outside cleaning her yard when the United Water
Company representative came to check her water meter. The representative
indicated that they would add a device that would allow the company to read the
meter from outside of the house.
June 1, 2012 -covering 92 days from 2/27/12 -5/29/12; current charges of
$357.65 (estimated bill); paid in full.
October 6, 2012-179 days from 2/27112-8/24/12; current charges of $7,094
(prorated actual bill overlapping with prior bill).
Cortes stated that she did not consume this amount of water and she "knows"
that the new meter was installed prior to this bill because that is the only possible
reason for the higher bill amount. There were no floods in the house, no
unattended running water, no need for plumbing work to be done, and nothing
otherwise unusual happened in the house to cause this level of usage.
She spoke to Simone in Customer Service who advised that if the bill was not
paid in full, service would be shut off. She stated that during 2012, a
representative came to the house four or five times to give notice ofa shut off.
November 8, 2012-listed on the ledger (P-1) in the amount of $67.31; she does
not recall receiving this bill.
Cortes asserts that there is a billing gap between August 24, 2012, and October
22, 2012. Further, she was required to go on a payment plan before the
company would conduct an investigation. In her opinion, the investigator was
"surprised" about the outstanding bill because she did not observe any reason for
high water usage. The investigator installed a new meter and issued a report
dated October 22, 2012. (P-8.)
November 28, 2012 -covering 35 days from 10/22/12 -11/26/12; current
charges of $67.31. (P-7.)
February 25, 2013 -quarterly bill in the amount of $159.13; listed on the ledger
(P-1).
4
OAL DKT. NO. PUC 11838-14
May 29, 2013-covering 92 days from 2/21/13 to 5/24/13; current charges of
$171.04; actual reading of the meter from outside of the house. (P-9.)
-August 28, 2013-quarterly bill reflected on the ledger in the amount of $131.55;
includes the summer months and she made four payments between this bill and
the last bill.
November 26, 2013 -reflected on the ledger, covering the period from 8/23/13 -
11/19/13; current charges $155.64; actual meter reading. (P-10.)
Cortes was making her monthly payments according to the payment plan plus
the current bill amounts.
February 25, 2014 -97 days covering 11/19/13-2/24/14; current charges
$195.44; prorated actual meter reading. (P-11.)
March 26,2014-reflected on the ledger (P-1) in the amount of $49.59; she does
not recall receiving this bill. Cortes states that during this time the monthly billing
process changed.
-April 25, 2014 -29 days covering 3/24/14 -4/22/14; current charges $45.48;
actual meter reading. (P-12.)
May 28, 2014-reflected on the ledger in the amount of $59.69.
June 25, 2014 -26 days covering 5/28/14 -6/23/14; current charges $41.62;
actual meter reading. (P-13.)
-July 28, 2014-reflected on the ledger in the amount of $49.86; it was during the
summer when usage was up due to watering the lawn. During the summer of
2014, she stopped making the monthly payments and filed her petition. Her child
was born on July 19, 2014.
-August 26, 2014 -29 days covering 7/24/14 -8/22/14; current charges $46;
actual meter reading. Cortes stated that there was a balance brought forward in
the amount of $7,245.49. (P-14.) There were no construction changes to the
home, no additions, and nobody moved out of the home. She was using the
water as usual during that time.
September 25, 2014 -32 days covering 8/22/14 -9/23/14; current charges
$46.06; actual meter reading. (P-15.)
October 27, 2014 -covering 9/23/14 - 1 0/24/14; current charges $54.30; actual
meter reading. Cortes was still home on maternity leave at this time.
November 25, 2014-28 days from 10/24/14-11/21/14; current charges 37.82;
5
OAL DKT. NO. PUC 11838-14
actual meter reading. (P-17.)
Cortes testified that in reviewing the bills reflected on the ledger (P-1) from
January 2, 2015, through October 27, 2015, all of the "current charges" were between
$38.29 and $64.33. She paid all of the current charges for each bill.
The Customer Service Investigation Report of October 22, 2012, indicates that
the "outside spigot for hose is leaking front & back." (P-8.) Cortes states that she had
used both spigots to wash down the porch and to clean up after her dog on the morning
that the investigator came. They were dripping from usage.
Cortes acknowledged that she did not pay the July 28, 2015, bill and she was
late in paying the August 28, 2015, bill. The August 29, 2011, bill (P-3) was "zeroed
out." Cortes believed that this was a result of her making payments under the payment
plan.
Vanessa Garcia
Respondent presented Vanessa Garcia (Garcia) who has been an employee of
Respondent for eleven (11) years. Her title was customer service representative at the
time that she conducted a high bill investigation at petitioner's home in 2011. Garcia did
not remember who she met with when she conducted the investigation on October 22,
2012. She was responding to a Field Order Ticket issued on October 16, 2012, which
provided the location of the meter to be investigated. (R-1 .) When there, Garcia read
existing meter no. 885006657, changed it and took another reading, then took the old
meter in to be tested.
Garcia stated that whenever there's movement on the meter she is required to
investigate whether she can determine a source for water running through the meter.
She determined that the water spigots in front and in back of the house were leaking.
As a result of the investigation Garcia prepared a Customer Service Investigation
Report. (P-8.) She concluded that there were no leaks from the two toilets, the sinks
and showers, and that both washing machines were not in use. (Ibid.)
6
OAL DKT. NO. PUC 11838-14
Garcia stated that they are required to change the water meters every seven to
eight years; however, she changed petitioner's meter because they usually remove
meters for high bill inspections. The date of installation of petitioner's meter was
September 12, 2011, so the meter was not removed because it was old.
Roy Hill
Respondent presented Roy Hill, Jr. (Hill), who worked for respondent for twenty­
three (23) years. He is a customer service field representative who has tested meters in
the shop for fifteen (15) years.
When he tested petitioner's meter he checked its serial number against the work
order. He tests twenty-four meters at a time, at three levels of testing. He tested
petitioner's meter, no. 88500657. The results of the test were that the meter functioned
at 99% on the "medium test" (flow of 2 gal. per minute) and 99.2% on "high test" (flow of
15 gal. per minute). There was no reading fo'r the "slow test" (flow of Y. gal. per minute).
(R-2.) His conclusion is that the meter was working properly.
Hill stated that the meter was not put back in service because it was an old "test"
meter. He typically holds a removed meter for thirty days in case there was a problem
at the residence and then it is discarded. The company was in the process of changing
to encoder meters and the old meter type was being phased out. The meter was not
reliable at low-flow levels.
Kathy Olfeldt
Respondent presented Kathy Olfeldt (Oifeldt), who is a manager in New Jersey
Customer Operations. She has been with the company for 25% years and is
responsible for collections and customer billing.
Olfeldt reviewed Petitioner's billing history, Exhibit P-1, in preparation for this
proceeding. She identified several bills that were disputed by petitioner. An invoice
7
OAL DKT. NO. PUC 11838-14
dated August 29, 2011, (P-3) is reflected on page 5 of 5 of Exhibit P-1. She stated that
the amount billed, $2, 190.48, was "canceled out." The evidence of this is that on Exhibit
P-1 there is a "$0.00" balance recorded next to the invoice amount. Further, this
amount is not reflected in subsequent invoices.
Olfeldt acknowledged that there was a previous balance listed on Exhibit P-3 that
is not reflected on the ledger, Exhibit P-1. Further although the billing was scheduled to
issue on a quarterly basis, there was another bill issued on September 16, 2011, less
than three weeks after the August 29 bill (P-3). She further acknowledged that Exhibit
P-1 was not produced by the company's billing system but was created manually.
Olfeldt does not know who prepared Exhibit P-1 and acknowledged that there are some
inconsistencies between the ledger, Exhibit P-1, and the invoices reflected by Exhibits
P-3 and P-7.
FINDING OF FACTS
Based upon the evidence and testimony in this case I FIND the following to be
the FACTS of this case:
1. Petitioner received an unusually high water usage bill in February 2011. Prior
to changing her meter, she received a series of estimated quarterly bills.
2. There were gaps in billing and a period of overlapping bills prior to October
2012.
3. After petitioner's meter was changed, there were regular monthly bills that
were in the range of $30-$70.
4. Respondent issued a bill dated August 29, 2011, in the amount of $2,190.48,
which petitioner paid in full. Respondent acknowledges that this payment
was canceled out.
8
OAL DKT. NO. PUC 11838-14
5. The electric meter measuring the amount of water consumed by petitioner's
home located at XX Marion Road, Montvale, New Jersey, was removed and
tested by a customer service field representative of United Water New Jersey.
6. The testing was done using the methods and standards adopted by the Board
of Public Utilities.
7. This test result does not support a finding that the meter in question was
reporting more consumption than what was actually being delivered to the
customer.
8. Petitioner did not present any expert testimony or other evidence to support
the position that the meter measurements reported for January to December
2011 or other relevant period, should be completely disregarded as
inaccurate.
9. Petitioner has not made a specific claim as to an amount that she claims is
due to her by respondent, or the specific time period for which her bills should
be credited. There is insufficient evidence in the record to support a reduction
in her water bill.
10. There is sufficient evidence in the record to question the accuracy of the bills
issued based upon estimated bills, overlapping time periods, and gaps in
billing.
LEGAL DISCUSSION AND CONCLUSIONS
A consumer may dispute a utility charge before the Board of Public Utilities.
N.J.A.C. 14:3-7.6. When the amount of an electric, gas, water, or wastewater bill is
significantly higher than the customer's established consumption history, and there is no
apparent explanation for the increase (for example, severe weather conditions; changes
in the make-up or the lifestyles of the members of the household), the customer's
established consumption shall be given consideration, in addition to the results of any
tests on the customer's meter, in the evaluation of whether the bill is correct and
appropriate. N.J.A.C. 14:3-7.6(g). The petitioner bears the burden of proof in this
matter by a preponderance of the competent, credible evidence. Atkinson v. Parsekian,
37 N.J. 143 (1962).
9
OAL DKT. NO. PUC 11838-14
In order to ensur~ a system that is fair to all customers of the utility, it is essential
that the meters be accurate in measuring usage. It is for this reason that the Legislature
enacted the provisions of N.J.S.A. 48:2-25 delegating to the Board of Public Utilities
authority to: "c. Establish reasonable rules, regulations, specifications and standards, to
secure the accuracy of all meters and appliances for measurement." Pursuant to and in
furtherance of this authority, the Board has adopted regulations that require each water
utility to ensure that all of the meters in use in its system are tested for accuracy. A
water meter shall be considered accurate if it shows an error no greater than one and
one half percent, when tested in accordance with this section. N.J.A.C. 14:9-4.1
I CONCLUDE that petitioner has not alleged that her meter no. 88500657 was
inaccurate in measuring consumption and she has not met her burden of proof by a
preponderance of the credible evidence that it did not operate properly during the billing
periods in question.
I CONCLUDE that there is no apparent explanation for the increase in the
amount of billed services (for example, severe weather conditions; changes in the
make-up or the lifestyles of the members of the household), and that petitioner's billing
history reflects monthly bills in the range of $30-$70.
I CONCLUDE that, during the period in question, the majority of the bills that
respondent issued were "estimates" and that there were discrepancies in the bills
issued by respondent during the subject billing period that remain unresolved.
ORDER
For the foregoing reasons it is hereby ORDERED that within thirty (30) days of
the date of the Final Decision, respondent shall reconcile the discrepancy in the bills
issued for the period beginning January 2011 through October 22, 2012, the date on
which the meter was replaced.
It is further ORDERED that within thirty (30) days of the date of the Final
Decision, petitioner shall submit to respondent a specific amount that she claims was
10
OAL DKT. NO. PUC 11838-14
overbilled and the basis for that conclusion.
It is further ORDERED that if the parties are do not reach an agreement within
forty-five (45) days of the date of the Final Decision, petitioner may file a billing dispute
claim for the specific amount determined to be improperly billed.
I hereby FILE my Initial Decision with the BOARD OF PUBLIC UTILITIES for
consideration.
This recommended decision may be adopted, modified or rejected by the
BOARD OF PUBLIC UTILITIES, which by law is authorized to make a final decision in
this matter. If the Board of Public Utilities does not adopt, modify or reject this decision
within forty-five days and unless such time limit is otherwise extended, this
recommended decision shall become a final decision in accordance with N.J.S.A.
52:148-10.
Within thirteen days from the date on which this recommended decision was
mailed to the parties, any party may file written exceptions with the SECRETARY OF
THE BOARD OF PUBLIC UTILITIES, 44 South Clinton Avenue, P.O. Box 350,
Trenton, NJ 08625-0350, marked "Attention: Exceptions." A copy of any exceptions
must be sent to the judge and to the other parties.
May 4, 2016
DATE
Date Received at Agency:
Date Mailed to Parties:
lr
LELAND S. MCGEE, ALJ
May 4. 2016
11
OAL DKT. NO. PUC 11838-14
APPENDIX
Witnesses
For Petitioner:
Bianca Cortes
For Respondent:
Vanessa Garcia
Roy Hill, Jr.
Kathy Olfeldt
Jill Mortimer
Exhibits
For Petitioner:
P-1 Bill Ledger 2011 to 2015
P-2 Water bill dated May 26, 2011
P-3 Water bill dated August 25, 2011
P-4 Water bill dated February 29, 2012
P-5 Water bill dated June 1, 2011
P-6 Water bill dated October 6, 2012
P-7 Water bill dated November 28, 2012
P-8 Customer Service Investigation Report
P-9 Water bill dated May 29, 2013
P-10 Water bill dated November 26, 2013
P-11 Water bill dated February 25, 2014
P-12 Water bill dated April25, 2014
P-13 Water bill dated June 25, 2014
P-14 Water bill dated August 26, 2014
P-15 Water bill dated September 25, 2014
P-16 Water bill dated October 27, 2014
P-17 Water bill dated November 25, 2014
12
OAL DKT. NO. PUC 11838-14
For Respondent:
R-1 Field Order ticket
R-2 Meter testing report dated October 25, 2012
13
United Water Inc
United Water, Inc is the United States' second-largest private water service provider. Headquartered in Harrington
Park, New Jersey, United Water, Inc operates in twenty five US states and serves "both as an owner-operator of
regulated utilities and as an operator of municipal and industrial systems through public-private partnerships and
contract services." [1] The water provider has been repeatedly criticized as responsible for some of the nation's
worse privatizations.[2]
Paris-based Suez Environnement, a global water and waste treatment company, is the parent company of United
Water.
United Water, Inc is a direct member of the international private water lobbying federation AquaFed.
Contents
1 Criticism
2 Communities Fighting Water Privatization
2.1 City of Indianapolis, March 2010
2.2 Camden New Jersey, January 2010
2.3 Rockland County New York, January 2010
3 Corporate and Industry Affiliates
4 Political Lobbying
5 References
6 External Links
Criticism
Public Citizen has reported that, when "United Water grab[s] control of a city’s water system, a top priority is
cutting costs, because low costs mean higher revenues... [United Water] slashes water system staffs to inadequate
levels, fails to perform necessary maintenance, tries to delay or avoid altogether any costly infrastructure
investments, screams for higher rates, more money from government or both, and blames public officials, or just
the public, for all the company’s problems. Customers end up paying more for less."[3]
The national consumer advocacy group Food & Water Watch released a report in January 2010 criticizing United
Water New York’s proposed desalination facility for the Hudson River. "[The facility] is a classic example of how
the interests of private water companies starkly conflict with the needs of the customers to whom they are
providing this essential resource,” said Wenonah Hauter, executive director of Food & Water Watch. “Rockland
County residents have voiced a preference for conservation and other low-cost, low-impact water-delivery options,
but United Water has instead chosen to pursue a high-tech method that would boost its profits.”[4] In addition to
increased water rates and energy use, drawing from the Hudson River could result in drinking water that contains
dangerous traces of radioactive chemicals.[5]
Communities Fighting Water Privatization
City of Indianapolis, March 2010
On March 10, 2010, City of Indianapolis Mayor Greg Ballard signed an agreement with Citizens Energy Group
(Citizens), a public charitable trust, to manage the City’s water and wastewater utilities. The agreement effectively
transfers the City's water services from the United Water to Citizens, which operates like a non-profit for
community benefit. “With this agreement, I am rejecting privatization," Mayor Ballard said. "Our water and
wastewater utilities will no longer be a political football. Local professional management, lower rates and
outstanding service make Citizens the best choice to own and operate our community’s water utilities.” [6]
Camden New Jersey, January 2010
In December 2009, the City of Camden N.J. sought to recover $29 million from United Water after the N.J. State
Comptroller found that the water provider's poor management had wasted taxpayer resources and exposed the
population to health risks. [7] [8] Although Camden was also criticized for mismanaging the United Water contract,
the independent audit compared United Water's service to that of developing nations, and said 45 percent of the
company's water to the city was lost due to leakage, overflow, meter inaccuracies, and billing errors.[9] Rather than
responding to this criticism by improving services, United Water filed a lawsuit for over $5.7 milllion against the
City of Camden, alleging the city had not made required payments for two years. [10] [11] United Water contends
that, because their contract with Camden had an arbitration clause, the city's lawsuit against them also constitutes a
breach-of-contract. [12] [13]
Rockland County New York, January 2010
As discussed above, in the "Criticism" section, Food And Water Watch issued a report criticizing United Water
New York's plans for a desalination facility drawing from the Hudson River. [14]
The Rockland Water Coalition comprises groups concerned with the status of Rockland County's water supply,
watershed health, rivers, streams and aquifer. For their take on the Haverstraw Water Supply Project, visit
[www.sustainablerockland.org] United Water New York provides information about its proposed Hudson River
Water Supply Project at [www.haverstrawwatersupplyproject.com]
Corporate and Industry Affiliates
"United Water is a member of a global family of water companies"[2] (http://www.unitedwater.com/corporate-
and-industry-affiliates.aspx)
- Suez Environnement
- GDF Suez (http://www.gdfsuez-globalenergy.com/)
- R+i Alliance (http://www.ri-alliance.com/)
- Utility Service Company (http://www.utilityservice.com/)
Membership in industry-based organizations:
- American Water Works Association (http://www.awwa.org/)
- National Association of Water Companies (http://www.nawc.org/)
- Water Environment Federation (http://www.wef.org/)
- National Association of Clean Water Agencies (http://www.nacwa.org/)
Political Lobbying
United Water, Inc maintains a Political Action Committee (PAC), the UNITED WATER INC FEDERAL PAC
(UW PAC). As of February 21st, 2010, OpenSecrets.org reports that the PAC contributed to the following
candidates:[15]
Senate
Crapo, Mike (R-ID) $2,500
Gillibrand, Kirsten (D-NY) $1,000
Menendez, Robert (D-NJ) $1,000
House
Pallone, Frank Jr (D-NJ) $2,000
Pascrell, Bill Jr (D-NJ) $600
Rothman, Steven R (D-NJ) $1,500
Sires, Albio (D-NJ) $500
UW PAC contributions to other PACs:[16]
DNC Services Corp $7,500
New Millennium PAC (Affiliate: Robert Menendez (D-NJ)) $5,000
National Assn of Water Companies $3,000
References
1. United Water "about us" page (http://www.unitedwater.com/localutility.aspx), accessed January 2010
2. Corporate profile (http://www.foodandwaterwatch.org/water/private-vs-public/united-water-a-corporate-prof
ile/?searchterm=united%20water) of United Water, Inc from Food & Water Watch
3. Suez Environnement Profile (http://www.citizen.org/cmep/Water/general/majorwater/suez/), Public Citizen,
accessed January 2010
4. Proposed Rockland County Desalination Plant a Boon for United Water New York a Bust for Area Water
Customers (http://www.foodandwaterwatch.org/press/releases/proposed-rockland-county-desalination-plant-
a-boon-for-united-water-new-york-a-bust-for-area-water-customers20100112), Food & Water Watch Press
Release, accessed January 2010
5. Not Worth Its Salt (http://www.foodandwaterwatch.org/water/pubs/reports/not-worth-its-salt), Food & Water
Watch, accessed January 2010
6. [1] (http://www.buildingindianablog.com/2010/03/10/citizens-to-take-over-indy-water-utilities/)
7. N.J. audit says Camden contract with water company cost taxpayers millions (http://www.nj.com/news/inde
x.ssf/2009/12/nj_audit_says_camden_contract.html), New Jersey Star Ledger, December 16 2009.
8. [www.state.nj.us/comptroller/news/docs/camden_pr_final12-16-09.pdf N.J. State Comptroller Report] (PDF)
9. Camden Water Provider Meets Criticism With Suit (http://www.philly.com/philly/news/local/83120182.htm
l), Philadelphia Enquirer, January 30 2010.
External Links
United Water, Inc website (http://www.unitedwater.com/)
Corporate profile (http://www.foodandwaterwatch.org/water/private-vs-public/united-water-a-corporate-profile/?se
archterm=united%20water) of United Water, Inc from Food & Water Watch
[3] (http://www.suez-environnement.com/)
Retrieved from "https://www.sourcewatch.org/index.php?title=United_Water_Inc&oldid=712000"
This page was last edited on 26 June 2017, at 16:47.
Content is available under Creative Commons Attribution-NonCommercial-ShareAlike unless otherwise
noted.
10. Camden Water Provider Meets Criticism With Suit (http://www.philly.com/philly/news/local/83120182.htm
l), Philadelphia Enquirer, January 30 2010.
11. Water Utility Seeks $5.7 Million from Camden (http://www.courierpostonline.com/article/20100130/NEWS
01/1300364/1006/news01/Water-utility-seeks--5.7M-from-Camden), New Jersey Courier Post, January 30,
2010
12. Camden Water Provider Meets Criticism With Suit (http://www.philly.com/philly/news/local/83120182.htm
l), Philadelphia Enquirer, January 30 2010.
13. Water Utility Seeks $5.7 Million from Camden (http://www.courierpostonline.com/article/20100130/NEWS
01/1300364/1006/news01/Water-utility-seeks--5.7M-from-Camden), New Jersey Courier Post, January 30,
2010
14. Proposed Rockland County Desalination Plant a Boon for United Water New York a Bust for Area Water
Customers (http://www.foodandwaterwatch.org/press/releases/proposed-rockland-county-desalination-plant-
a-boon-for-united-water-new-york-a-bust-for-area-water-customers20100112), Food & Water Watch Press
Release, accessed January 2010
15. United Water Contributions to Federal Candidates (https://fecwatch.org/pacs/pacgot.php?cycle=2010&cmte=
C00280156), OpenSecrets.org, accessed February 2010
16. UW PAC PAC-PAC Contributions (https://fecwatch.org/pacs/pac2pac.php?cycle=2010&cmte=C00280156),
OpenSecrets.org, accessed February 2010
Has Water
Privatization
Gone Too Far
in New Jersey?
An independent analysis of New Jersey's
expensive and troubling experiences with
private water companies
About Food & Water Watch
Food & Water Watch is a non-profit organization working with grassroots organizations around the world to create
an economically and environmentally viable future. Through research, public and policymaker education, media and
lobbying, we advocate policies that guarantee safe, wholesome food produced in a humane and sustainable manner and
public, rather than private, control of water resources including oceans, rivers and groundwater. For more information, visit
www.foodandwaterwatch.org.
Food & Water Watch
1616 P St. NW, Suite 300
Washington, DC 20036
tel: [phone]
fax: [phone]
[e-mail]
www.foodandwaterwatch.org
Copyright © June 2010 by Food & Water Watch. All rights reserved. This report can be viewed or downloaded at
www.foodandwaterwatch.org.
New Jersey Office
100 Bayard Street, Suite 310
New Brunswick, NJ 08901
tel: [phone]
fax: [phone]
[e-mail]
Executive Summary and Key Findings....................................................................................................................iv
New Jersey’s Privatization Task Force.......................................................................................................................1
Stacking the deck.......................................................................................................................................1
Redundant study about efficiency...............................................................................................................2
Paying More for Privatized Water Service................................................................................................................2
Expensive loans...........................................................................................................................................3
No competition and no efficiency gains.......................................................................................................4
Additional costs..........................................................................................................................................4
Service and Environmental Problems.....................................................................................................................4
The wrong incentives..................................................................................................................................5
Loss of Local Control.............................................................................................................................................5
New Jersey Experiences in Water Privatization........................................................................................................6
Childhood cancer in Dover Township.........................................................................................................6
High bills in North Brunswick.....................................................................................................................6
A scathing audit in Camden.......................................................................................................................6
A public victory over a flawed sale in Trenton..............................................................................................7
Watershed destruction in Bergen County.....................................................................................................8
A Public Solution...................................................................................................................................................8
Appendix A............................................................................................................................................................9
Endnotes..............................................................................................................................................................10
Has Water Privatization
Gone Too Far in New Jersey?
iv
Executive Summary
Cities and towns across New Jersey have struggled to balance their budgets in the wake of the recent economic downturn
that has left them with dwindling revenues and escalating expenses. Meanwhile, public leaders in Trenton have promoted
the privatization of public water and sewer utilities as a means of fiscal relief. Both the governor of New Jersey and mayor
of Trenton had plans in the works to give private interests control over water systems in the state.
For New Jersey, water privatization is not a new concept. The state has a long history with private water provision and
serves as headquarters for two of the country’s largest water companies: American Water, based in Voorhees, and United
Water, based in Harrington Park.1 The state’s experience with private water service, however, has been marred with failure
and disappointment. Consumers frequently report unsatisfactory service and high rates after private entities take over their
water systems.
Indeed, New Jersey municipalities will not resolve their fiscal woes by privatizing water and sewer services. Tough
economic times require local governments to take swift yet judicious measures to balance today’s budget without com-
promising tomorrow’s. As public officials determine how to cut deficits, they must avoid superficial solutions, such as
auctioning off water utilities and outsourcing sewer services, which can have lasting consequences.
Water privatization is not a responsible way to shore up local budgets. It can result in greater long-term costs, serious
environmental problems and a loss of local control.
Key Findings
The New Jersey State Privatization Task Force was one-sided and unnecessary.
New Jersey is one of the most receptive states to water privatization.
On average, private operation of water systems adds 64 percent, $153 a year, onto the typical New Jersey household’s
water bill.
Private water companies have a questionable track record, which includes serving contaminated water in Dover
Township and selling developers land that was meant to protect Bergen County water supplies.
Public-public partnerships and a renewed federal commitment to water infrastructure funding are better options for New
Jersey municipalities.
Food & Water Watch
1
Municipal functions, including water provision, have no di-
rect effect on the state budget, so their inclusion in the study
implies that Christie created the task force for other reasons
in addition to the state’s fiscal emergency. Perhaps he even
used the budget shortfall as a pretext to pursue privatization.
Stacking the deck
Christie staffed the task force with people who seemed sup-
portive of privatizing water services. At least three of the five
members had corporate relationships and experiences that
likely predisposed them to endorse privatization, despite any
evidence of its negative consequences:
• Dick Zimmer, the chair of the task force, is a for-
mer Congressional Representative who cosponsored
numerous bills seeking to privatize government services
and assets, including the Tennessee Valley Authority,
during the 1990s.3 After leaving Congress, he worked at
Gibson, Dunn & Crutcher from 2001 to 2009,4 during
which time, among other things, the company advised
governments on infrastructure privatization.5
• Kathleen A. Davis, the executive vice president of
the Chamber of Commerce Southern New Jersey, is a
former lobbyist and director of governmental affairs for
New Jersey American Water, the state’s largest water
company.6
• John Galandak is the president of the Commerce and
Industry Association of New Jersey, a statewide busi-
ness advocate,7 whose board of directors includes
New Jersey Governor Chris Christie believes that privatization of government
services can help remedy the state’s $11 billion budget shortfall. In March 2010,
he established the New Jersey State Privatization Task Force to determine how to go
about that process. Although his stated intention was to relieve state budgetary pressure,
Christie did not limit the scope of the task force’s study to state operations. Instead, the
task force was to assess privatization throughout all levels of government.2 This included
public water and sewer utilities.
New Jersey’s Privatization Task Force
Has Water Privatization Gone Too Far in New Jersey?
2
the president of United Water,8 the U.S. subsidiary of
Suez Environnement, the world’s second-largest water
corporation.9
This selection of like-minded task force members precluded
an impartial evaluation. With the task force stacked in favor
of privatization, the question was never whether to privatize
but how to facilitate it.
Redundant study about efficiency
New Jersey didn’t need another task force to promote priva-
tization. American Water, the nation’s largest water com-
pany, already considered New Jersey to be very privatization
friendly, and the state already had several laws advanta-
geous to privatization projects.10 Moreover, previous New
Jersey governors had conducted similar privatization stud-
ies. If Christie wanted to enhance efficiency, he should have
avoided such redundancy.
His task force closely replicated an earlier one established
by Christine Todd Whitman, his Republican predecessor.
In 1994, then-governor Whitman issued Executive Order
17 — Christie’s executive order mirrors Whitman’s down
to the number — that created the New Jersey Advisory
Commission on Privatization.11 After several months of study,
the commission recommended privatizing dozens of govern-
ment services, from airports to sewers.12 In May 1995, four
months after her commission presented its recommendations,
Whitman signed the New Jersey Water Supply Public-Private
Contracting Act and the New Jersey Wastewater Supply
Public-Private Contracting Act, which made it easier for
private companies to take control over municipal water and
sewer systems.13
More than 10 years later, former-governor Jon Corzine also
took up the privatization torch, pursuing what he called as-
set monetization as a way to generate funding. In 2006, his
administration hired investment bank UBS to analyze and
value the state’s infrastructure assets. The results of this study
inspired Corzine’s disastrous attempt to lease the state’s toll
roads. The lease proposal, which was essentially dead on ar-
rival, would have increased tolls by as much as 800 percent
by 2022, and was met with sharp public opposition.14 It
was so unpopular that during the 2009 gubernatorial race,
Christie attacked Corzine for saying he might revisit it.15
The 2010 New Jersey Privatization Task Force was one-sided
and unnecessary. Cities and towns needed better informa-
tion to determine if private control of services would reduce
costs without sacrificing quality. For the water and sewer
sector, the experiences of many municipalities across the
state suggest that it will not. In many cases, when private
companies run water systems, consumers end up paying
more for worse service.
Paying More for Privatized Water
Service
New Jersey residents pay much more if private companies
control their water systems. Food & Water Watch surveyed
the rates of the 14 largest community water systems in New
Jersey and found that, on average, privately run systems
charge households 64 percent more than municipal systems
charge. A typical household using 5,000 gallons a month
pays an extra $153 a year if its water services are privatized
(see Appendix A for more details).16
New Jersey American Water, the state’s largest investor-
owned water utility, has an aggressive rate increase strategy.
Over the last two decades, it has raised rates 11 times, for a
total increase of 140 percent. From 1990 to 2009, a typical
household, using 7,000 gallons a month, saw their annual
water bill grow from $366 (in 2009 dollars) to $587.17 In
April 2010, the company requested another 13.6 percent
increase, which if approved in full, would bring this toll to
$680 a year.18
Four Republican members of the New Jersey state legislature
— senator Tom Goodwin, senator Phil Haines, assembly-
woman Dawn Marie Addiego and assemblyman Scott Rudder
— came out against the company’s 2010 rate hike. “As I am
sure you are aware, many of the residents in my district live
on fixed incomes and struggle every month to pay their bills,”
Goodwin wrote in a letter to the Board of Public Utilities.
“This rate increase would put a tremendous strain on their
finances, making it more difficult to meet basic needs.”19
New Jersey Water Bill Comparison
Average Annual Water Bill for a Household Using
5,000 Gallons a Month
0
$50
$100
$150
$200
$250
$300
$350
$400
$239.52
Publicly Run Systems Privately Run Systems
$392.82
Food & Water Watch
3
Three other New Jersey State legislators — Senator
Christopher Connors, Assemblyman Brian Rumpf and
Assemblywoman DiAnne Gove — contested a proposed
rate increase of another large water company: United Water
Toms River, which serves 125,000 people in Toms River,
South Toms River and parts of Berkeley. In November 2009
the company requested a 37 percent rate hike that would
increase the average residential water bill by $158 a year,
bringing it to $554 a year.20
The following month, United Water New Jersey petitioned to
increase its rates by 21 percent adding $117 onto the typi-
cal household’s annual water bill. The company serves more
than 800,000 people in Bergen, Hudson, Hunterdon, Mercer,
Passaic and Sussex Counties. If the hike were approved in
full, the average residential customer would pay $697 a year
for water service.21 Lambertville officials opposed the rate re-
quest,22 and Hudson County Freeholder Bill O’Dea and Jersey
City Councilmember Steven Fulop chartered a bus giving area
residents a free ride to a public hearing about the increase.23
“While in our capacities as councilman and freeholder, we
have limited ability to stop the increase. Regardless, it is
absolutely crucial that we fight United Water and make our
voices heard,” said Fulop, as reported by The Jersey Journal.
“This is nothing more than another backdoor tax on residents
that they can’t afford.”24
Expensive loans
The sale or lease of water and sewer systems, in particular,
can lead to considerable rate hikes for consumers. When a
city cashes out its water assets, the company that takes over
the system will recover its payment with interest through
customer bills. In effect, the funding that the city receives is
an expensive loan that ratepayers must pay off over the term
of the lease. It is a circuitous and often expensive way to tax
residents.
Former State Senator Leonard Connors (R-Ocean) made a
similar observation when he told the Star-Ledger why he
opposed a 1995 state senate bill authorizing these types of
arrangements: “The company getting the lease and leasing
the water supply would naturally put the concession money
in the rates, so some grubby mayor — and I am a mayor (of
Surf City), so I can say this — could balance the budget on
the lease. It was basically taxing through the tap.”25
For taxpayers, a water system lease merely shifts the burden
from one biller (the city) to another (the water company), and
private operation of water systems tends to be more expen-
sive than public operation.
Even investment bank UBS, when it conducted Corzine’s
asset monetization study, found that New Jersey’s wa-
ter and sewer systems were “unattractive” candidates for
privatization. The study determined that because municipal
water utilities carry considerable debt and need expensive
improvements, a lease or sale would require “meaningful
rate increases” to be profitable for investors.26
The Growing Annual Water Bill of a
Typical Household Customer of New
Jersey American Water
Based on an Average Consumption of 7,000 Gallons
a Month in the Company’s Main Service Area
New Jersey American Water’s Rate
Increase History
Date Percent
Increase
Cumulative
Increase
June 1990 2.4%2%
February 1991 9%12%
March 1992 4.7%17%
May 1993 5.1%23%
September 1993 1.2%24%
November 1994 6%32%
April 1996 21.4%60%
March 1999 5.85%69%
February 2004 9.56%85%
March 2007 12.5%109%
December 2008 15.2%140%
April 2010*13.6%173%
*2010 rate increase pending approval
*2010 rate increase pending approval
Inflation-adjusted bill (2009 dollars)
Annual bill (nominal)
$200
$300
$400
$500
$600
$700
$800
1990 1991 1992 1993 1994 1996 1999 2004 2007 2008 2010*
Has Water Privatization Gone Too Far in New Jersey?
4
No competition and no efficiency gains
Given the high prices charged by privately run water utilities,
New Jersey cities and towns should not expect water privati-
zation to reduce operating costs. In fact, empirical evidence
indicates that there is no significant difference in efficiency
between private and public water production.27 Germà Bel of
the University of Barcelona and Mildred Warner of Cornell
University reviewed all econometric studies of efficiency
and water privatization from 1976 to 2006 and concluded,
“While some studies found public production more efficient,
most found no significant differences in costs or efficiency
between public and private production.”28
Although market forces may be able to enhance efficiency
and reduce costs in other sectors, the water industry is differ-
ent. Water pipes and treatment plants are so expensive that
it is economically impractical for multiple water providers to
serve the same community.29 Because of the industry’s mo-
nopolistic nature, water companies experience competition
only during the bidding process. Once a contract goes into
effect, the new private operator has a captive customer base.
Competition for contracts also is increasingly limited.30 There
are few private water businesses,31 and Suez and Veolia, both
French multinationals, dominate the international market.32
Researchers warn that a lack of competition can lead to ex-
cess profits and corruption in private operations.33
Additional costs
In many cases, privatization increases costs. Corporate
profits, dividends and income taxes can add 20 to 30 percent
to operation and maintenance costs.34 The process of priva-
tizing water systems is complicated, expensive and time-
consuming,35 and monitoring costs can be substantial.36 For
small municipalities, transaction costs can be prohibitively
high,37 and for very large regional wastewater treatment
systems, the U.S. Environmental Protection Agency said, “the
process may become so complex that it would be difficult to
implement.”38
In total, contract monitoring and administration, conversion
of the workforce, unplanned work, and use of public equip-
ment and facilities can increase the price of a contract by
as much as 25 percent.39 Other hidden expenses, including
change orders and cost overruns, can further inflate the price
of private service.
Service and Environmental Problems
Water privatization affects not only consumers’ pocketbooks;
it can also degrade customer service and the environment.
A Food & Water Watch survey of 10 water and sewer sys-
tems found that after privatization, the new private managers
reduced the workforce by one-third, on average. As a result,
service often suffered and backlogs of work orders often
accrued.40
When private operators attempt to cut costs, practices they
employ could result in worse service quality.41 In certain
cases, private operators even have a financial incentive to
ignore basic upkeep and drive up the cost of capital improve-
ments. Such neglect can hasten equipment breakdowns and
increase replacement costs, which are usually the responsi-
bility of the municipality. In many contracts, private opera-
tors can technically comply with their contract terms while
effectively shifting upkeep costs to the local government.42
A report published by the National Rural Water Association
found deterioration of water systems can be “particularly
problematic” in long-term contracts.43 Because 70 to 80
percent of water and sewer assets are underground, a
municipality cannot easily monitor a contractor’s perfor-
mance. Consequently, as a researcher for the Global Water
Partnership Technical Advisory Committee warned, “The
effects of shoddy work may not become evident during the
contracting period.”44
Food & Water Watch
5
The wrong incentives
Selling water systems can result in a different set of problems.
When private companies operate publicly owned water
systems, they usually drive down costs by cutting corners to
boost profits, but when they own water systems, they have
the opposite desire. The New Jersey Board of Public Utilities
regulates privately owned water systems and determines
the rates these companies can charge their customers based
in part on how much the companies invest in the systems.
Investor-owned water utilities therefore have a financial
incentive to build costly infrastructure projects. Water com-
panies use greater infrastructure investment to justify higher
rates, which then lead to higher earnings.45
Water companies usually have little incentive to encourage
water efficiency. In most situations, when water use falls,
their revenues similarly decline, so it makes little business
sense for them to tell their customers to consume less water.
When faced with dwindling water resources, private utilities
may prefer to seek out new water supplies, which require
costly investments that augment their long-term profits, rather
than implement water conservation programs.46
For similar reasons, private ownership of water and sewer
utilities facilitates sprawl. Private utilities profit from costly
sprawling systems, whereas municipalities often do not want
to spend public resources to serve areas outside their tax
base. In fact, several cities use the provision of water and
sewer services as a way to promote smart growth. As a result,
real-estate developers frequently partner with water compa-
nies to serve new satellite developments.47
Sprawling development can harm the water supply because
it changes the natural landscape. When rain hits hard pave-
ment instead of dirt, it cannot filter naturally into the ground
and recharge the underground aquifers that supply water to
wells, rivers, lakes and streams. Instead, it is often diverted
into storm drains and discharged into surface waters.48 This
can strain local drinking water sources that rely on ground-
water. It can also lead to sewer overflows if too much storm-
water enters the sewers and overloads the pipes.49
Loss of Local Control
As is evident in the aforementioned sections, when local gov-
ernments privatize their water systems, they abdicate local
control over a valuable public resource. In the case of leases
and sales, they no longer determine water rates or capital
improvement plans, which affect water quality and access to
water. Because a water corporation has different goals than
a city does, it will make its decisions using a different set
of criteria, often one that emphasizes profitability. This has
important equity and environmental implications.50
Because water service is a natural monopoly, consumers can
exercise choice only at the ballot box through the election
of the public officials who oversee their utility.51 When local
governments privatize their water systems, the public loses its
ability to choose. Community members do not have access
to the boardroom of water companies.
In addition, privatization can be difficult to reverse. After
selling a water or sewer system, a municipality often cannot
undo the decision and reclaim its water resources without
lengthy and costly eminent domain proceedings.52 With
leases and other contractual arrangements, municipalities
are bound by the terms of the contract and cannot choose
another service provider for the full duration of the deal.
Under most circumstances, assuming no violation of contract
provisions, a city can exit the contract early only by paying a
substantial termination fee to the water company.
New Jersey municipalities can best protect the public interest
by avoiding water privatization schemes.
Has Water Privatization Gone Too Far in New Jersey?
6
New Jersey Experiences in Water
Privatization
The following case studies exemplify the myriad problems
experienced by cities and towns across New Jersey when
private companies operated their water and sewer systems.
Childhood cancer in Dover Township
A federal and state investigation found an association be-
tween childhood cancer and contaminated drinking water
served by United Water Toms River.
In 1996, a state report uncovered that Dover Township in
southern New Jersey had significantly higher rates of certain
types of childhood cancers.53 After a massive five-year study,
state and federal investigators linked drinking water from a
specific United Water Toms River well field to leukemia in
girls — the small sample size, however, precluded unam-
biguous conclusions.54
Five days before the study was released, United Water Toms
River and two chemical companies agreed to make undis-
closed multimillion-dollar payments to 69 families of chil-
dren with cancer. Several months later, United Water and
one of the chemical companies reached another monetary
settlement with dozens of other families. In total, United
Water paid $12 million, after insurance reimbursements, to
settle the $800 million claims for wrongful death and injury.
Throughout the process, the company admitted no wrong-
doing, but the families accused it of serving contaminated
drinking water that caused the children to develop cancer.55
Water problems continued in Dover. In 2005 the state
Department of Environmental Protection fined United Water
Toms River $104,000 for using too much water and con-
structing main extensions without a state permit.56 The next
year, the company received a $64,000 fine for failing to noti-
fy the state and the public when the water contained illegally
high levels of radionuclides. The state later determined that
the company’s operators manipulated drinking water tests to
conceal potential quality violations.57
High bills in North Brunswick
High water bills are a common complaint after the lease or
sale of a water utility. For example, in 1996, North Brunswick
leased its water and sewer systems to a private company
(now owned by United Water) that agreed to pay the town a
total of $54 million over the term of the contract.58 Six years
into the 20-year deal, after meter changes doubled or tripled
the bills of many households,59 the town exited the water
portion of its contract by buying out the remaining 14-year
term at a cost of $30 million.60
“It’s become a model for the way not to do such deals,”
David Spaulding, the mayor at the time, told the Star-Ledger,
adding, “The people saw themselves getting screwed.”61
United Water continued to run the sewer system until 2006,62
when the town council unanimously voted to terminate the
contract and manage the sewers itself.63 Public operation
saved the town $140,000 in 2007.64
A scathing audit in Camden
Camden encountered numerous problems after transferring
operation of its water and sewer systems to United Water
(formerly U.S. Water).
In 2009, 10 years into the 20-year, $178 million deal, the
New Jersey State Comptroller’s Office issued a scathing audit
of Camden’s privatization contract. It found that inadequate
contract supervision and the company’s poor performance
cost the city millions of dollars and potentially jeopardized
the health and safety of its residents.65
The audit found that between 2004 and 2008 the water util-
ity lost nearly half (45 percent) of its water, likely through
leaks, storage overflows and other errors. By exceeding the
Food & Water Watch
7
10 percent maximum established in its contract, the com-
pany cost Camden about $1.7 million in lost revenue.66
Adding to this cost, the company received at least $6 million
in pass-through and other payments without proper city ap-
proval. This includes $2.2 million associated with a proposed
contract amendment that the city never approved.67
Inadequate upkeep of water tanks, wells, fire hydrants and
other equipment posed potential health and safety risks to
consumers, according to the audit. United Water could not
account for every utility asset and failed to complete required
maintenance projects.68
The comptroller also documented numerous billing issues.
United Water’s failure to calibrate meters could have caused
over-billings, and in 2008, the city had to write off more than
$1 million in unsubstantiated fees resulting from incorrect
rates, inaccurate estimates and unreliable meter readings.
The company lacked an adequate information system to track
account data properly, and partly because of the company’s
inadequate collection efforts, at the beginning of 2009, the
utility had $4.5 million in unpaid customer bills that were at
least 90 days old.69
Although the company disputed many of the audit’s findings,
the city agreed with every recommendation. At the end of
2009, Camden sought to recover $28.9 million from United
Water for poor performance, unauthorized payments and
credits for capital projects conducted by the city, among
other things.70 In January 2010, the company responded by
suing Camden for $5.7 million in alleged back payments.71
The situation remains unresolved.
A public victory over a flawed sale in Trenton
In 2010 Trenton residents rebuffed a proposal to sell part of
their water system.
Three years earlier, in 2007 Trenton officials signed a contract
to sell a majority of the city’s water infrastructure — the pipes
and structures located in the outlying communities of Ewing,
Hamilton, Hopewell and Lawrence Townships — to New
Jersey American Water.72 From the deal, the city expected to
receive $80 million, about half of which would have gone
towards paying off water-related debt. Trenton planned to use
the remaining proceeds to cover immediate budget deficits,
likely depleting the windfall within a couple years.73
It was a shortsighted approach. Selling the system would not
address the underlying structural reasons for the city’s budget
deficit, and it could worsen the city’s long-term fiscal health
because the city would lose annual revenue from the water
fund. From 2007 to 2010, the city spent $15 million of its
water funds on general city services.74
In addition, the financial viability of Trenton’s water system
would have depended on continued bulk water sales to New
Jersey American Water, which as part of the deal, agreed to
use city water to meet the needs of the outlying communities
for at least 20 years.75 If American Water were to stop buying
water from the city, Trenton households would likely have
faced rate increases to help offset the lost revenue.
For the affected suburban towns, rate hikes seemed inevi-
table if the sale had occurred. New Jersey American Water
planned to incrementally increase their rates to the level
charged in its main service area.76 As a result, the typical
household using 7,000 gallons a month would have seen
their water bills increase by 33 percent, or $138 a year. This
difference likely would have grown over time, given that the
company usually increases its rates every two years. Its 2010
rate request, if approved in full, would add about another
$85 to the typical annual household bill, bringing it to a total
of $645. In comparison, customers of Trenton Water Works
pay only $423 a year for the same amount of water.77
A group of residents, recognizing the faulty logic of the
sale, contested the deal and petitioned to bring the issue to
the public for a vote. Trenton officials, led by then-Mayor
Douglas Palmer and backed by New Jersey American Water,
unsuccessfully fought their efforts. The state Supreme Court
ruled in favor of the petitioners supporting their right to seek
a citywide referendum.78
Immediately after the court decision, New Jersey American
Water ramped up an aggressive campaign under the name
The Committee for Trenton Yes to sway residents to support
the sale. In six weeks of campaigning, the company spent at
least $845,000 — more than 15 times the amount spent by
Stop the Sale, the local anti-sale group aided by Food & Water
Typical Annual Household Water BillBased on an Average Household Water Use of 7,000 Gallons a Month (May 2010)
$422.57
$560.13
$645.33
Trenton American Water American Water
(Proposed Rates)
0
$100
$200
$300
$400
$500
$600
$700
$800
Has Water Privatization Gone Too Far in New Jersey?
8
Watch. Despite the company’s heavily funded operation, on
June 15, 2010, Trenton voters overwhelmingly rejected the
sale by a margin of nearly 4-to-1.79 David beat Goliath.
Watershed destruction in Bergen County
Water companies have sold land protecting water supplies
to developers. These deals may produce short-term gains
for stockholders but they have long-term consequences for
residents who could have to pay for treatment plants that
otherwise would not have been necessary. By creating a
natural buffer from pollution, forested land protects water
supplies, improves water quality and reduces drinking water
treatment costs.80
In the 1980s, United Water transferred about 600 acres
of land, originally acquired to protect the water supply in
Bergen County, to its real estate development subsidiary,
which planned to resell the land to developers.81 The com-
pany reaped substantial profits from these land deals. In
one instance, two months after buying 23 acres of land
from the water utility, the real estate subsidiary resold it at
a 400 percent profit. This didn’t translate into lower water
bills for United Water’s customers, who each received only
a one-time $18 payment for the entire 600 acres of former
watershed land. In fact, at the time, the company charged the
state’s highest water rates.82
United Water’s dealings with developers triggered the
Watershed Protection Act, a 1988 state law that requires state
approval before utilities can convey watershed land for any
purpose other than protecting public water supplies. This law
delayed but did not stop the company’s plans.83
Environmentalists actively opposed the company’s land sales,
challenging some in court and picketing the company’s
annual stockholder meetings.84 In 2007, after environmen-
tal groups forced New Jersey to conduct a three-year state
investigation into its land deals, two top state officials said
that United Water likely broke the Watershed Protection Act
by allowing developers and private individuals to use land
meant to protect the reservoirs. A state panel did not fine the
company but told it to settle with the environmentalists.85
Two years later, United Water entered into an agreement with
Hackensack Riverkeeper and Bergen Save the Watershed
Action Network to preserve more than 3,000 acres along the
company’s reservoirs to redress the company’s 165 violations
of the Watershed Protection Act.86
A Public Solution
New Jersey faces a fiscal emergency that warrants respon-
sible solutions — not quick fixes that could leave the state
worse off in the long run. For that reason, New Jersey cities
and towns should not pursue the privatization of water
and sewer systems as a way to relieve budgetary pressure.
Privately run water utilities have a bad track record in New
Jersey. From Bergen County to Camden, communities across
the state have experienced the consequences of water privati-
zation. After private companies take over water and sewer
systems, many consumers have seen their water bills climb
and their service decline.
Publicly run water services can often offer better environ-
mental outcomes at a lower cost. For additional savings and
service improvements, municipalities can partner together
through public-public partnerships to share resources and
expertise. Intermunicipal cooperation, interlocal agreements
and bulk purchasing consortiums can enhance service qual-
ity and reduce costs while allowing communities to retain
local control.87 Researchers have found that public-public
partnerships are more equitable than privatization, particular-
ly for rural municipalities, which often lack access to private
contractors, making market failure common.88
Public-public partnerships may not be enough for some com-
munities to make the expensive improvements necessary to
protect water resources. The country also needs a dedicated
source of federal funding through a clean water trust fund
to help municipalities renovate their water infrastructure.
A renewed federal commitment can help ensure that every
New Jersey resident has access to safe, clean and affordable
water service.
Food & Water Watch
9
Appendix A
Food & Water Watch surveyed every community water
system serving more than 100,000 people in New Jersey. The
U.S. Environmental Protection Agency (EPA) classifies these
systems as “very large.”
Based on the EPA’s Safe Drinking Water Information System’s
annual inventory of public water systems, New Jersey has
15 very large community water systems, 14 of which were
included in this rate comparison. The New Jersey District
Water Supply Commission – Wanaque North water system
was excluded because it serves municipalities.
Private entities — American Water, United Water and
Middlesex Water — own eight of the 14 surveyed systems,
with local governments owning the rest. In addition,
American Water runs one publicly owned system, Liberty
Water Company, and United Water runs another publicly
owned system, the Jersey City Municipal Utilities Authority.
For each system, water rate schedules were found on the
utility’s website. Additionally, Food & Water Watch called
the Newark Water Department and the Jersey City Municipal
Utilities Authority to verify their rates.
Using these rate schedules, Food & Water Watch calculated
the monthly bill for a household using 5,000 gallons a month
with a standard 5/8-inch meter. For computing New Jersey
American Water rates, household customers were assumed
to be nonexempt from the state water tax.
Water System Name Status Residential Population Fixed Monthly Rate (5/8” meter)
Volumetric Rate Total Monthly Bill
Annual Bill Effective Date of Rate
Notes
Dollars Per Units Rate for 5,000 gallons
PUBLIC
Atlantic City Municipal Utility Authority
Publicly owned and operated 150,000 $8.23 $2.42 100 cf $16.19 $8.23 $98.80 1-Jan-10 Allowance of 2500 cf/quar-ter included in fixed rate
Newark Water Department Publicly owned and operated 273,000 $- $22.26 1,000 cf $14.88 $14.88 $178.54 1-Jan-10
Passaic Valley Water Commission Publicly owned and operated 314,900 $17.01 $1.52 100 cf $10.16 $27.17 $326.04 1-Jan-10
Trenton Water Works Publicly owned and operated 205,000 $15.41 $21.16 1,000 cf $14.14 $29.56 $354.68 4-Sep-08
Public Average $239.52
PRIVATE
Jersey City Municipal Utility Authority (United Water)
Publicly owned, privately operated
229,000 $6.07 $3.45 100 cf $23.06 $29.13 $349.56 1-Jan-10
Liberty Water Company (American Water)
Publicly owned, privately operated
110,002 $9.00 $4.58 1,000 gal $22.89 $31.89 $382.71 8-Dec-08
Middlesex Water Company Privately owned and operated 233,376 $11.33 $30.29 1,000 cf $20.24 $31.57 $378.87 17-Mar-10
New Jersey American Water – Raritan System
Privately owned and operated 609,387 $9.00 $4.62 1,000 gal $23.11 $32.11 $385.28 8-Dec-08 Service area 2, nonexempt
New Jersey American Water - Coastal North System
Privately owned and operated 343,078 $9.00 $5.38 1,000 gal $26.91 $35.91 $430.95 8-Dec-08 Service area 1, nonexempt
New Jersey American Water - Ocean City System
Privately owned and operated 155,071 $9.00 $5.38 1,000 gal $26.91 $35.91 $430.95 8-Dec-08 Service area 1, nonexempt
New Jersey American Water Privately owned and operated 217,230 $9.00 $5.38 1,000 gal $26.91 $35.91 $430.95 8-Dec-08 Service area 1, nonexempt
New Jersey American Water – Western Division
Privately owned and operated 253,045 $9.00 $5.38 1,000 gal $26.91 $35.91 $430.95 8-Dec-08 Service area 1, nonexempt
United Water New Jersey Privately owned and operated 773,458 $5.68 $4.40 1,000 gal $21.98 $27.66 $331.96 3-Apr-09
United Water Toms River Privately owned and operated 123,184 $5.90 $5.09 1,000 gal $25.44 $31.34 $376.04 11-Nov-09
Private Average $392.82
COMPARISON: How much greater are the rates of privatized systems than those of public systems?
Difference $153.31
Percent Greater 64%
Has Water Privatization Gone Too Far in New Jersey?
10
Endnotes
1 American Water Works Company, Inc. U.S. Securities and Exchange Commission. Form 10-K. March 1, 2010 at 1 and 3; Suez Environnement Company. Autorite Des Marches Financiers. 2009 Reference Document. April 12, 2010 at 89 and 335.2 Christie, Chris. State of New Jersey. Executive Order No. 17. March 11, 2010; State of New Jersey. [Press release]. “Governor Christie creates task force to develop a comprehensive approach to workforce privatization.” March 11, 2010; Dopp, Terrence. “New Jersey Governor Christie may privatize state jobs.” Bloomberg. March 11, 2010.3 H.R. 1810, 104th Cong. (1995); H.R. 3878, 104th Cong. (1996); H.R. 1129, 103rd Cong. (1993); H.R. 28, 104th Cong. (1995); H.R. 163 103rd Cong. (1993); H.R. 4430, 102nd Cong. (1992); H.R. 3780, 103rd Cong. (1994).4 State of New Jersey. [Press release]. “Governor Christie creates task force to de-velop a comprehensive approach to workforce privatization.” March 11, 2010.5 Collins, Antony. “New York trio bag leading roles on 20bn French Government sell-off.” Legal Week. February 17, 2005; Gibson, Dunn & Crutcher LLP. “2006: The year in review.” 2006 at 13; Tieman, Ross. “French road operator IPO on track.” The Deal. September 23, 2004; Gibson Dunn. “Global Finance: Project finance.” Accessed April 10, 2010; Gibson, Dunn & Crutcher LLP. “European competition practice.” December 2006 at 7, 8, 22, 23, 24 and 27.6 State of New Jersey. [Press release]. “Governor Christie creates task force to de-velop a comprehensive approach to workforce privatization.” March 11, 2010.7 State of New Jersey. [Press release]. “Governor Christie creates task force to de-velop a comprehensive approach to workforce privatization.” March 11, 2010.8 Commerce and Industry Association of New Jersey. Board of Directors. Available at www.cianj.org/pages/about/directors.php?active_link=about, Accessed April 22, 2010.9 Suez Envionnement Company. Autorite des Marches Financiers. 2009 Reference Document. April 12, 2010 at 90, 335; Prinsent Masons. (2009). Prinsent Masons Water Yearbook 2009-2010. 11th Edition. London: Prinsent Masons LLP at 18 to 19.10 Correll, Don. President and Chief Executive Officer. American Water. “American Water Overview.” Presented at Investor Conference. December 7, 2009 at 14; Patterson, Bill. Senior Vice President. American Water. “Corporate and Business Development.” Presented at Investor Conference. December 7, 2009 at 73 to 74; West, Teno A. Pannone Lopes Devereaux & West LLC. “State laws advanta-geous to P3 projects.” Presented at NCPPP Annual Meeting, Phoenix, Arizona. November 20, 2009 at 8; American Water Works Company, Inc. Securities and Exchange Commission. Form 10-K. March 1, 2010 at 1, 3. 11 Governor Christine Todd Whitman. State of New Jersey. Executive Order No. 17. April 18, 1994.12 Mondics, Chris. “N.J. privatization panel issues sweeping wish list.” The Philadelphia Inquirer. January 20, 1995.13 New Jersey Statutes §58:26-19 to §58:26-27 (1995); New Jersey Statutes §58:27-19 to §58:27-27 (1995); Tedeschi, Bruno. “Law lets utilities be run privately.” The Record. May 13, 1995.14 UBS Investment Bank. “State of New Jersey: Asset Evaluation program Phase 1 Report.” November 15, 2006 at 2, 8; Reitmeyer, John and Tom Davis. “While N.J. toll plan stalls, Pa. weighs deal.” The Record. May 27, 2008; Belson, Ken. “Toll road offers New Jersey a fiscal test drive.” The New York Times. April 13, 2008; Kaske, Michelle. “Corzine calls for Toll PBC: N.J. governor details restruc-turing plan.” The Bond Buyer. February 5, 2008.15 Halbfinger, David M. “Corzine vows turnpike tolls will not rise.” The New York Times. October 31, 2009.16 Rates of New Jersey’s very large community water systems, excluding the New Jersey District Water Supply Commission. Data sources: U.S. Environmental Protection Agency. Safe Drinking Water Information System-Federal. Public Water System Inventory. July 2009; Utility rate schedules for Altantic City MUA, Jersey City MUA, Middlesex Water Company, New Jersey American Water, Newark Water Department, Passaic Valley Water Commission, Trenton Water Works and United Water, current as of April 30, 2010, on file with Food & Water Watch. 17 New Jersey American Water. [Press Release]. “New-Jersey American rate in-crease approved.” June 29, 1990; New Jersey American Water. [Press Release]. “New Jersey-American receives rate increase.” February 27, 1991; New Jersey American Water. [Press Release]. “New Jersey-American granted increase.” March 6, 1992; Gaffigan, Michelle. “New Jersey-American customers face 19.3 percent rate increase.” Burlington County Times. September 17, 1992; Kelly, Darren. “Water company seeks third rate hike in a year.” Burlington County Times. March 9, 1994; “South Jersey news in brief.” The Philadelphia Inquirer. November 23, 1994; New Jersey American Water. [Press Release]. “New Jersey-American Water Company files for rate increase.” April 18, 1995; Ott, Dwight. “New Jersey-American seeks water rate rise.” The Philadelphia Inquirer. January 14, 1998; Twyman, Anthony S. “New Jersey water utility’s rates to increase.” The Star-Ledger. April 1, 1999; New Jersey American Water. [Press Release]. “New Jersey Board of Public Utilities grants New Jersey American Water new rates.” February 19, 2004; New Jersey American Water. [Press Release].”New Jersey American Water, Elizabethtown Water and Mt. Holly Water file for new rates.” March 31, 2006; New Jersey American Water. [Press Release]. “American Water’s New Jersey subsidiary is granted new rates.” March 22, 2007; New Jersey American Water. [Press Release]. “Significant investment in infrastructure drives New Jersey American Water rate filing with New Jersey Board of Public Utilities.” January 14, 2008; New Jersey American Water. [Press Release]. “New Jersey American Water granted new rates by NJ Board of Public Utilities.” December 8, 2008.
18 Ortiz, Erik. “New Jersey American Water seeks 13 percent rate increase.” Press of Atlantic City. April 10, 2010. 19 The New Jersey State Senate Republicans. [Press Release]. “State Sen. Goodwin calls on Board of Public Utilities to deny massive water rate increase.” April 15, 2010; Kenney, Robbie. New Jersey Senate Republicans. “Haines, Addiego & Rudder troubled by NJ American rate hike petition.” April 15, 2010. 20 Michels, Chelsea. “9th District legislators demand BPU reject United Water rate hike.” Asbury Park Press. December 7, 2009; United Water Toms River. [Press
Release]. “United Water Toms River files rate request with NJBPU.” November 18, 2009; Delaney, Bonnie. “Hearing on United Water’s rate rise request is
March 8.” Asbury Park Press. February 18, 2010.21 United Water New Jersey. “Verified Petition.” In the Matter of the Petition of United Water new Jersey Inc. for Approval of an Increase in Rates for Water Service and Other Tariff Changes. State of New Jersey, Board of Public Utilities.
December 9, 2009 at 1 to 2; United Water New Jersey. [Press Release]. “United Water New Jersey files rate request with NJBPU.” December 9, 2009; 22 Sanabria, Gabby. “Lambertville officials oppose water company rate increase.” Hunterdon County Democrat. April 22, 2010; 23 Hayes, Melissa. “Two officials offering Hudson residents rides from New Jersey City to Hackensack for hearing on United Water’s proposed rate hike.” The Jersey Journal. April 15, 2010; Whiten, Jon. “Get on the bus: Fulop, O’Dea tak-ing the masses to United Water Hearing.” The Jersey City Independent. April 14, 2010.24 Hayes, Melissa. “Jersey City politicans charter bus to Untied Water rate hike hearing.” The Jersey Journal. April 14, 2010.25 Sherman, Ted. “Liquid assets – for those seeking new markets, water systems are a potential money machine.” Star-Ledger, Oct. 1, 2003.26 UBS Investment Bank. “State of New Jersey: Asset evaluation program: Phase 1 Report.” November 15, 2006 at 76.27 Ouyahia, Meriem Ait. Policy Research Initiative, Government of Canada. “Public-private partnerships for funding municipal drinking water infrastructure: What are the challenges?” May 2006 at 2 and 12; Bel, Germà and Mildred Warner. “Does privatization of solid waste and water services reduce costs? A review of empirical studies.” Resources, Conservation and Recycling vol. 52, iss. 12. October 2008 at 1337, 1341 and 1342; Pérard, Edouard. “Water supply: Public or private? An approach based on cost of funds, transaction costs, ef-ficiency and political costs.” Policy and Society, iss. 27. 2009 at 193 and 197 to 199. 28 Bel, Germà and Mildred Warner. “Does privatization of solid waste and water services reduce costs? A review of empirical studies.” Resources, Conservation and Recycling vol. 52, iss. 12. October 2008 at 1337, 1341 and 1342.29 The Association of California Water Agencies. “USC Study Examines the Issue of Privatized Public Water Service: A briefing paper on a new report by the University of Southern California.” December 1996.30 Bel, Germà and Mildred Warner. “Challenging issues in local privatization.” Environment Planning C: Government and Policy, vol 26, iss. 1. 2008 at 105; Bel, Germà and Mildred Warner. “Does privatization of solid waste and water services reduce costs? A review of empirical studies.” Resources, Conservation and Recycling vol. 52, iss. 12. October 2008 at 1341 to1343.31 Black, Roger. Deloitte Corporate Finance. “PPPs and the water sector: Plugging the infrastructure hole.” March 2009 at 14.32 Ouyahia, Meriem Ait. Policy Research Initiative, Government of Canada. “Public-private partnerships for funding municipal drinking water infrastructure: What are the challenges?” May 2006 at 5. 33 Bel, Germà and Mildred Warner. “Does privatization of solid waste and water services reduce costs? A review of empirical studies.” Resources, Conservation and Recycling vol. 52, iss. 12. October 2008 at 1342.34 Association of Metropolitan Sewerage Agencies and Association of Metropolitan Water Agencies. “Evaluating Privatization II: An AMSA/AMWA Checklist.” 2002 at 23. 35 Ouyahia, 2006 at at 2; Seppälä, Osmo T., Jarmo J. Hukka and Tapio S. Katko. “Public-private partnerships in water and sewerage services: Privatization for profit or improvement of service and performance?” Public Works Management Policy, vol. 6, iss. 42. 2001 at 48.36 Featherstun, Donald G., D. Whitney Thornton II and J. Gregory Correnti. “State and local privatization: An evolving process.” Public Contract Law Journal, vol. 30, iss. 4. Summer 2001 at 649.37 HM Treasury. “Standardisation of PFI contracts, version 4.” March 2007 at 3; HM Treasury. “PFI: Strengthening long-term partnerships.” March 2006 at 21; Iossa, Elisabetta and David Martimort, Centre for Economic and International Studies, University of Rome. “The simple macro-economics of public-private partnerships.” May 11, 2008 at 21 to 22. 38 U.S. Environmental Protection Agency, Office of Water. “Response to Congress on the privatization of wastewater facilities.” (EPA 832097-100a). July 1997 at 20. 39 American Federation of State, County and Municipal Employees, AFL-CIO. “Government for Sale: An examination of the contracting out of state and local government services.” Eight Edition. (299-06). 2006 at 2; Martin, Lawrence. Reason Institute. “How to compare costs between in-house and contracted services.” March 1993 at 5 to 6.40 Food & Water Watch. “Water Privatization Threatens Workers, Consumers and Local Economies.” May 2009 at 4 .41 Smith, Harold J. Raftelis Financial Consulting. “Privatization of Small Water Systems.” Rural Water Partnership Fund White Paper, National Rural Water Association. December 23, 2003 at 17.42 Association of Metropolitan Sewerage Agencies and Association of Metropolitan Water Agencies, 2002 at 27; The Association of California Water Agencies. “USC Study Examines the Issue of Privatized Public Water Service: A briefing paper on a new report by the University of Southern California.” December 1996.
Food & Water Watch
11
43 Smith, 2003 at 19.44 Rees, Judith. Global Water Partnership, Technical Advisory Committee. “Regulation and private participation in the water and sanitation sector.” (TAC Background Papers No. 1). July 1998 at 21; Ouyahia, 2006 at 8 to 9.45 Averch, Harvey, and Leland L. Johnson. “Behavior of the firm under regula-tory constraint.” The American Economic Review, vol. 52, iss. 5. December 1962 at 1059; Ouyahia, 2006 at 33; National Association of Regulatory Utility Commissions, NARUC Staff Subcommittee on Accounting and Finance. “Rate Case and Audit Manual.” Summer 2003 at 16 and 49. For more information, see Food & Water Watch. “Costly returns: How corporations could profit from the already high cost of repairing the nation’s crumbling water and sewer infrastruc-ture.” June 2008.46 For example, see Food & Water Watch. “Not Worth Its Salt: How Rockland County could end up paying for an unnecessary desalination plant.” January 2010 at 1,3,4,5 and 11.47 For more information, see Food & Water Watch. “Water and sewer privatization contributes to sprawl.” January 2010.48 U.S. Environmental Protection Agency, Nonpoint Source Control Branch. “Protecting Water Quality from Urban Runoff.” (EPA 841-F-03-003). February 2003.49 Brown, Ann et al. Sierra Club. “Sprawl: The Dark Side of the American Dream.” 1998 at 4 to 5.50 Smith, Harold J. National Rural Water Association. “Privatization of Small Water Systems.” December 23, 2003 at 11, 12, 14, 17 and 18.51 The Association of California Water Agencies. “USC Study Examines the Issue of Privatized Public Water Service: A briefing paper on a new report by the University of Southern California.” December 1996; “State regulators play a role in privatization.” Water Sense, vol. 3, iss. 3. Summer 1997 at 7 to 8.52 Jacobs, Jeffrey W. and Charles W. Howe. “Key issues and experiences in US wa-ter services privatization.” Water Resources Development, vol. 21, no. 1. March 2005 at 95.53 Peterson, Iver. “Firms settle with parents of ill children.” The New York Times. December 14, 2001.54 Peterson, Iver. “Study ties childhood cancer in Toms River to pollution.” The New York Times. December 18, 2001; New Jersey Department of Health and Senior Services, Environmental and Occupational Health, Division of Epidemiology and U.S. Department of Health and Human Services, Agency for Toxic Substances and Disease Registry. “Volume 1: Summary of the Final Technical Report.” Case-control Study of Childhood Cancers in Dover Township (Ocean County), New Jersey. January 2003 at 10 to 11.55 Hill, Walton. United Water. “Risk and reality. United Water Toms River.” National Association of Regulatory Utility Commissioners, Water Committee. February 20, 2007 at 5; Peterson, Iver. “Firms settle with parents of ill children.” The New York Times. December 14, 2001; Avril, Tom. “Toms River, N.J., children get $13 million in water-pollutant deal.” The Philadelphia Inquirer. January 23, 2002; Williams, Cuker & Berezofsky et al. [Press Release]. “Settlement reached in claims regarding childhood cancer concerns in Toms River, New Jersey.” December 13, 2001; “Consent order settles lawsuits filed over Superfund site.” The Associated Press. August 6, 2002; Alaya, Ana M. “Toms River families press fight.” The Star-Ledger. December 18, 2002.56 Mikle, Jean. “Water utility’s problems part of a pattern.” Asbury Park Press. February 21, 2006.57 State of New Jersey Department of Environmental Protection. [Press release]. “DEP fines water systems, licensed operators for fraudulent monitoring and reporting.” May 10, 2006.58 George, Dana Yvette. “North Brunswick passes utility plan.” Star-Ledger. February 13, 1996; United Utilities PLC. [Press Release]. “US Water wins long-term concession contract in New Jersey, USA.” March 11, 1996; United Water. [Press Release]. “United Water acquires U.S. Water’s water and wastewater contract operations.” August 1, 2002.59 Sherman, Ted. “Liquid assets: for those seeking new markets, water systems are a potential money machine.” Star-Ledger. October 1, 2003.60 The town promptly entered into a new management contract with a different water company – American Water. Goldberg, Dave. “Water contract presented to public.” North Brunswick Sentinel. May 9, 2002.61 Sherman, Ted. “Liquid assets: for those seeking new markets, water systems are a potential money machine.” Star-Ledger. October 1, 2003.62 Albright, Scott. “North Brunswick, N.J., votes for new water contract.” Home News Tribune. July 3, 2002.63 North Brunswick Township, New Jersey. “An ordinance authorizing the termination of the wastewater services agreement for the ownership of North Brunswick’s wastewater system by and among the township of North Brunswick, The Middlesex County Improvement Authority and United Water as successor-in-interest to U.S. Water Service Company LLC.” (#06-10). May 23, 2006. 64 Amato, Jennifer. “Proposed budget would carry 4-cent tax hike.” Home Town Sentinel. September 21, 2006; North Brunswick Township, New Jersey. Minutes. Regular meeting. May 15, 2006 at 4.65 Boxer, A. Matthew. Office of the State Comptroller, State of New Jersey. “A Performance Audit of the Management Services Agreement for the City of Camden’s Water and Wastewater Collection Systems.” (PA-06). December 16, 2009 at 1, 2 and 5; Ott, Dwight and Jon Stenzler. “Water deal is approved in Camden.” The Philadelphia Inquirer. November 7, 1998; Office of the State Comptroller, State of New Jersey. [Press release]. “State Comptroller finds Camden’s mismanagement of water contract cost taxpayers millions.” December 16, 2009.66 Boxer, A. Matthew. Office of the State Comptroller, State of New Jersey. “A Performance Audit of the Management Services Agreement for the City of Camden’s Water and Wastewater Collection Systems.” (PA-06). December 16, 2009 at 16 to 17.67 Ibid. at 5 to 6 and 23 to 27.
68 Ibid. at 6, 9 to 14, 30 to 31.69 Ibid. at 6, 7, 8, 11, 21 and 22.70 Ibid. at 40 and Appendix C: United Water Response.71 Walsh, Jim. “Water utility seeks $5.7M from Camden.” Courier Post. January 30, 2010.72 New Jersey Board of Public Utilities. “In the matter of the joint petition of the city of Trenton, New Jersey and New Jersey American Water Company Inc. for authorization of the purchase and sale of the assets of the outside water utility system (“OWUS”) of the city of Trenton, New Jersey and for other relief.” (Docket No. WM08010063). April 3, 2009 at 2 and 3; McIntyre, Joseph. Trenton Water Works General Superintendent. “Trenton Water Works (TWW) Fact Sheet.” July 23, 2008; Rinde, Meir. “Trenton voters sink water deal 6,986 to 1,812.” The Times of Trenton. June 16, 2010.73 Rinde, Meir. “Big tax hit if water deal is delayed, says mayor.” The Times of Trenton. March 3, 2009.74 Rinde, Meir. “Big tax hit if water deal is delayed, says mayor.” The Times of Trenton. March 3, 2009; Rinde, Meir. “Fired up over Water Works.” The Times of Trenton. May 5, 2010; Coryell, Lisa. “Trenton tapped water utility.” The Times of Trenton. July 23, 2007.75 Water Supply Agreement Between City of Trenton and New Jersey-American Water, Inc. December 21, 2007 at 7, 8 and 21; Second Amendment to Water Supply Agreement Between City of Trenton and New Jersey-American Water Company, Inc. February 2009 at 1 and 2.76 New Jersey Board of Public Utilities. “In the matter of the joint petition of the city of Trenton, New Jersey and New Jersey American Water Company Inc. for authorization of the purchase and sale of the assets of the outside water utility system (“OWUS”) of the city of Trenton, New Jersey and for other relief.” (Docket No. WM08010063). April 3, 2009 at 4.77 New Jersey-American Water Company, Inc. “Tariff for water and sewer service.” December 18, 2008 at Rate Schedule A-1; City of Trenton, NJ. Municipal Code §309-8 (2008); New Jersey American Water. [Press Release]. “NJ American Water files for new rates with BPU.” April 13, 2010; Kenney, Robbie. New Jersey State Republicans. [Press Release]. “Haines, Addiego & Rudder troubled by NJ American rate hike petition.” April 15, 2010.78 In Re Petition for Referendum on City of Trenton ordinance 09-02, Supreme Court of New Jersey, (A-70). April 6, 2010 at 1, 26; Rinde, Meir. “Foes of Water Works sale rally for ballot option.” The Times of Trenton. April 8, 2009; Rinde, Meir. “High court will hear Water Works appeal.” The Times of Trenton. February 12, 2010; Parker, L.A. “Supreme Court says voters decide Trenton water sale.” The Trentonian. April 6, 2010; Duffy, Erin. “Tide turn: Court blocks water utility sale.” The Times of Trenton. April 7, 2010; Palmer, Douglas H. “State to city council and residents of Trenton: The impact of the petition on the city’s balanced 2009 budget.” March 10, 2009.79 Parker, L.A. “American Water begins campaigning for water deal referendum.” The Trentonion. April 29, 2010; Rinde, Meir. “Clerk certifies petition for Water Works referendum.” The Times of Trenton. April 29, 2010; Rinde, Meir. “Backers of water sale swimming in funds.” The Times of Trenton. May 27, 2010; The Committee for Trenton Yes. New Jersey Election Law Enforcement Commission. Form C-3. June 15, 2010; The Committee for Trenton Yes. New Jersey Election Law Enforcement Commission. Form PC Amendment. May 7, 2010; Stop the Sale. New Jersey Election Law Enforcement Commission. Form R-1. June 3, 2010 at 1; Mercer County Clerk. June 15, 2010 Election Information. June 15, 2010.80 Spencer, Louisa C. “A vote for legislation to save Bergen County’s watershed.” The Record. April 25, 1993; Fischer, Richard A. et al. “Improving riparian buffer strips and corridors for water quality and wildlife.” American Water Resources Association. International Conference on Riparian Ecology and Management in Multi-land Use Watersheds. August 2000 at 2; Wenger, Seth J. and Laurie
Fowler. Carl Vinson Institute of Government. The University of Georgia. “Protecting stream and river corridors: Creating effective local riparian buffer
ordinances.” Public Policy Research Series. 2000 at 4, 48 to 49.81 United Water Resources. [Press release]. “Hackensack Water gets OK from New
Jersey Board of Public Utilities to transfer ownership of land to Rivervale Realty.” November 1, 1984; Stokes, Stephanie. “At a watershed – a drain on United
Water protesters continue fight over land sale.” The Record. May 12, 1992; Spencer, Louisa C. “A vote for legislation to save Bergen County’s watershed.”
The Record. April 24, 1991.82 Hanley, Robert. “Utility selling watershed area for large profits.” The New York
Times. August 5, 1987.83 Nussbaum, Alex. “Did N.J. supplier endanger our water?” The Record. February
9, 2007; New Jersey Statutes §48:2-23.1; Hackensack Water. [Press Release]. “Hackensack Water receives its first rate hike in 2 years.” December 14, 1998.
84 Stokes, Stephanie. “At a watershed – a drain on United Water protesters con-tinue fight over land sale.” The Record. May 12, 1992.
85 Nussbaum, Alex. “Did N.J. supplier endanger our water?” The Record. February 9, 2007; Nussbaum, Alex. “N.J. probes utility’s deals with developers.” The Record. April 20, 2004.86 Hackensack Riverkeeper. [Press Release]. “Bergen SWAN and Hackensack
Riverkeeper combine forces, secure protection of 3,300 acres in Upper Hackensack River Watershed.” April 14, 2009; Fallon, Scott. “3,100 watershed acres spared.” The Record. March 28, 2009.87 Bel, Germa and Xavier Fageda. “Between privatization and intermunicipal co-operation: Small municipalities, scale economies and transaction costs.” Urban Public Economics Review. 2006 at 15, 25 and 27; Doin, Dave. “Public financ-ing and procurement methods.” Water World. June 2007 at 60; Boag, Gemma and David A. McDonald. “A critical review of public-public partnerships in water services.” Water Alternatives, iss. 3, no. 1. February 2010.88 Warner, Mildred and Amir Hefetz. “Rural-urban differences in privatization: limits to the competitive state.” Environment and Planning C: Government and Policy, vol. 21. 2003 at 703, 711, 714 and 715; Boag and McDonald, 2010.
Food & Water Watch
Main Office
1616 P St. NW, Suite 300
Washington, DC 20036
tel: [phone]
fax: [phone]
[e-mail]
www.foodandwaterwatch.org
New Jersey Office
100 Bayard Street, Suite 310
New Brunswick, NJ 08901
tel: [phone]
fax: [phone]
[e-mail]
Suez Environnement’s
Poor Record in the
United States
About Food & Water Watch
Food & Water Watch is a non-profit organization working with grassroots organizations around the world to create
an economically and environmentally viable future. Through research, public and policymaker education, media
and lobbying, we advocate policies that guarantee safe, wholesome food produced in a humane and sustainable
manner and public, rather than private, control of water resources including oceans, rivers and groundwater. For
more information, visit www.foodandwaterwatch.org.
Food & Water Watch
1616 P St. NW, Suite 300
Washington, DC 20036
tel: [phone]
fax: [phone]
[e-mail]
www.foodandwaterwatch.org
Copyright © May 2010 by Food & Water Watch. All rights reserved. This report can be viewed or downloaded at
www.foodandwaterwatch.org.
California Office
25 Stillman Street, Suite 200
San Francisco, CA 94107
tel: [phone]
fax: [phone]
[e-mail]
Executive Summary................................................................................................................................................iv
Introduction...........................................................................................................................................................1
An Overview of Suez’s History in the United States................................................................................................1
A Saga of Poor Performance....................................................................................................................................2
Atlanta, Georgia.........................................................................................................................................2
Camden, New Jersey..................................................................................................................................3
Milwaukee, Wisconsin................................................................................................................................4
Gloucester, Massachusetts..........................................................................................................................4
Gary, Indiana..............................................................................................................................................5
Saving Money with Public Operation.....................................................................................................................6
North Brunswick, New Jersey......................................................................................................................6
Houston, Texas...........................................................................................................................................6
Fairfield-Suisun, California............................................................................................................................7
Laredo, Texas..............................................................................................................................................7
Conclusion.............................................................................................................................................................8
Informational Charts:
Suez in the United States: Timeline of Major Events and Annual Revenue...................................................2
Suez and United Water: 2009 Financial Highlights.....................................................................................3
Examples of United Water’s Operations Included in This Report..................................................................6
Endnotes................................................................................................................................................................10
Suez Environnement’s Poor Record in the
United States
United Water
Executive Summary
Suez Environnement has a poor track record in the United States. From sewage overflows in Milwaukee,
Wisconsin, to contaminated drinking water in Gloucester, Massachusetts, serious problems have afflicted munici-
palities across the country after they turned their water or sewer systems over to Suez-owned United Water.
Under the leadership of Suez, United Water has grown into the second-largest private operator of municipal water
systems in the United States. However, because the company has had a large number of high-profile failures, in
recent years, it has won few new contracts to operate city water systems. As a result, it has focused on taking over
other water companies to eliminate its competition.
Poor performance has cost the company several of its largest contracts. Suez’s flagship effort in the United States
— a long-term contract with Atlanta, Georgia — ended 16 years early in 2003 after the city documented numer-
ous problems from a large maintenance backlog to inadequate bill collection. After issuing 20 notices of noncom-
pliance to United Water, the city of Milwaukee, Wisconsin, decided against keeping the company when its con-
tract came up for renewal in 2007. Gloucester, Massachusetts, similarly ended its contract with the company after
water quality violations in 2009.
Expensive service has cost United Water several other deals. From Gary, Indiana, to Fairfield-Suisun, California,
cities across the country have ended contracts with the company, opting to run their water and sewer systems
themselves. For these municipalities, public operation has saved money and improved services.
Reliable public operation with a renewed federal commitment to infrastructure funding will allow municipali-
ties to responsibly address the growing infrastructure needs facing many of the nation’s aging water systems. With
access to a dedicated source of federal funding to improve water systems, cash-strapped municipalities can avoid
the financial pressure that leads them into privatization schemes with companies like Suez in the first place.
Public control and federal funding are the best ways for the United States to ensure that safe, clean and affordable
water service is available for generations to come.
Food & Water Watch
1
Under the leadership of Suez, United Water has become the
second-largest private operator of municipal water systems in
the country. From its founding in 1869 until the early 1990s,
the company operated primarily as a New Jersey utility
called Hackensack Water Company. Since then, through a
number of acquisitions, United Water — still headquartered
in Harrington Park, New Jersey — has grown into an industry
giant that in 2009 served 7.2 million people in 26 states.1
An Overview of Suez’s History in the
United States
Lyonnaise des Eaux — which after a series of mergers, spin
offs and name-changes, would become Suez Environnement2
— first got involved in the U.S. water industry in the early
1980s. From 1982 to 1985, Lyonnaise took over General
Waterworks Corporation, which at the time was the nation’s
third-largest water company.3 Over the next 20 years, the
company grew by buying out its competition and consolidat-
ing the market.
In 1994, a decade after being acquired by Lyonnaise,
General Waterworks merged into United Water,4 creating
the country’s second-largest public water utility.5 After the
merger, Lyonnaise des Eaux and United Water entered into a
partnership to pursue privatization contracts and run munic-
ipal water systems.6 Three years later, this strategic partner-
ship took over JMM Operational Services, a firm special-
izing in the operation and maintenance of municipal water
systems.7 In 2000, after winning key deals in Milwaukee and
Atlanta through the joint venture, Suez increased its stake
in United Water, acquiring and bringing the entire company
under its control.8
Since then, United Water’s growth has plateaued. It served
approximately 300,000 fewer people in 2008 than when
Suez bought it eight years earlier.9 The company is persisting
on smaller-scale deals and frequent rate increases10 and gets
its biggest boost from the occasional takeover of a competi-
tor. It bought Aquarion Operating Services in 2007 and Earth
Tech’s North American water operations business in 2008.
Despite eliminating competition through acquisition, United
Water’s new contract growth has stagnated. It lost its largest
Suez Environnement, the world’s second-largest water company, has been active in
the U.S. water industry for nearly three decades under various names. In 2000, Paris-
based Suez expanded its presence in the United States by purchasing United Water, one
of the country’s largest water companies.
Introduction
Residents in Milwaukee protest the privatization of their water system at a city council meeting in June 2009. Photo by Jon Keesecker/Food & Water Watch.
United Water: Suez Environnement’s Poor Record in the United States
2
client, Milwaukee, Wisconsin, in 2007, signed no new
contracts the following year and lost a net of six government
clients in 2009.11
A Saga of Poor Performance
Poor performance may have led to these stagnant waters.
Service delays, inadequate upkeep and water quality viola-
tions cost United Water several of its largest water and sewer
contracts and undermine its operations in many other cities.
Its dramatic failure in Atlanta, Georgia — what was to be its
showcase effort — dampened the water privatization market
in the United States. Since then, few large cities have priva-
tized their water or sewer systems.
The following case studies exemplify the problems that com-
munities across the country experienced after turning their
water systems over to Suez’s United Water.
Atlanta, Georgia
New Year’s Day 1999 marked the beginning of the larg-
est water privatization in U.S. history — a $428 million
deal that United Water promised would cut Atlanta’s water
costs in half. “Atlanta for us will be a reference worldwide,”
Suez’s CEO Gérard Mestrallet told the Atlanta Journal and
Constitution at the time, “a kind of showcase.”20
It was also Suez’s debut as a lead water operator in the
United States. Eight months later, Suez announced its pur-
chase of United Water, elevating the strategic alliance to an
all-out merger.21
Only 18 months into the contract, in August 2002, the city
was so dissatisfied with United Water’s poor performance
that it threatened to terminate the contract if the company
didn’t make marked improvements within 90 days. Due in
part to dramatic staff cuts, the city said that maintenance
backlogs were “unacceptable,” repairs were delayed and re-
sponse times were “consistently and habitually inadequate.”
According to the city, the company wasn’t reading, installing
and maintaining enough water meters, and the city was los-
ing millions of dollars because United Water wasn’t collect-
ing enough late bills.
The city accused United Water of submitting bills for work
it didn’t do — even having its Atlanta staff work on other
contracts and try to win new contracts. The company also
refused to release certain billing records.22
Suez in the United States: Timeline of Major Events and Annual Revenue
*Revenue data not available.
0
$100
$200
$300
$400
$500
$600
$700
$800
19
8
4
19
8
5
19
8
6
19
8
7
19
8
8
19
8
9
19
9
0
19
9
1
19
9
2
19
9
3
19
9
4
19
9
5
19
9
6
19
9
7
19
9
8
19
9
9
20
0
0
20
0
1
20
0
2
20
0
3
20
0
4
20
0
5
20
0
6
20
0
7
20
0
8
20
0
9
19
8
2
19
8
3
Societe Lyonnaise des Eaux et de l’Eclairage buys half of General Water Works from IU International
Lyonnaise des Eaux completes acquisition of General Water Works from IU International
GWC Corporation buys half of JMM Operational Services from Montgomery Watson
United Water and Suez Lyonnaise enter into a joint venture and purchase the rest of
JMM Operating Services
GWC Corporation merges into United Water
Suez buys United Water
United Water buys U.S. Water from Bechtel and United
Utiltities
United Water buys AOS Operating Company from Kelda
Suez buys
Earth Tech
from AECOM
An
n
u
a
l

R
e
v
e
n
u
e
s

i
n

M
i
l
l
i
o
n
s

o
f

2
0
0
9

U
S
D
*******
Food & Water Watch
3
Scandal broke two months later when former Mayor Bill
Campbell, who had signed the original deal, announced he
had never signed documents authorizing $80 million in extra
payments that United Water had requested.23After a lengthy
probe, Campbell was charged in 2004 with multiple fed-
eral corruption charges, including accepting $12,900 from
United Water to pay for a trip to Paris with a friend, and tak-
ing United Water’s $6,900 campaign contribution at a time
he was not eligible for re-election.24 At Campbell’s trial in
early 2006, it was suggested that one of Campbell’s top aides
may have forged the letters.25
Campbell was convicted of tax evasion in March 2006, but
acquitted of racketeering and bribery. He was sentenced to
30 months in prison.26 United Water was not charged.
It was not corruption, though, that doomed United Water,
but the corporation’s performance. United Water saved only
half the amount of money it had anticipated27 and amassed
a backlog of 14,000 work orders.28 Atlanta terminated its
contract with United Water in March 2003, four years into
the 20-year deal.29
Camden, New Jersey
Camden, New Jersey, encountered similar problems after
transferring control of its water and sewer systems to United
Water (formerly U.S. Water).
In 2009, 10 years into the 20-year, $178 million deal, the
New Jersey State Comptroller’s Office issued a scathing audit
of company’s Camden operations. It found that inadequate
contract supervision and the company’s poor performance
cost the city millions of dollars and potentially jeopardized
the health and safety of its residents.30
The audit exposed several serious issues:
High unaccounted-for water loss. Between 2004 and 2008,
the utility lost 45 percent of its water, likely through leaks,
storage overflows and other errors. United Water’s contract
with the city required it to limit unaccounted-for water loss
to 10 percent. By exceeding this contract standard, United
Water cost Camden almost $2 million in lost revenue.31
Poor maintenance. Inadequate upkeep of water wells,
storage tanks, fire hydrants and other equipment posed
potential health and safety risks. The company could not ac-
count for every utility asset and failed to complete required
maintenance projects. Its failure to calibrate meters could
Suez: 2009 Financial Highlights
Revenues: € 12.3 billion ($17.7 billion)
Profit: € 516 million ($744 million)12
Population served with drinking water: 90 million people
Population served with sewer service: 58 million people13
United Water: 2009 Financial Highlights
Revenues: € 530 million ($763 million)14
Population served: 7.2 million people15
Main divisions:1. Regulated privately owned water and sewer systems Locations: 20 utility operations in eight statesPopulation served: 2.1 million people16
Revenues: € 280 million ($403 million)17
2. Contract operations and other non-regulated activities Locations: 237 service contracts in 26 statesPopulation served: 5.1 million people18
Revenues: € 249 million ($359 million)19
United Water: Suez Environnement’s Poor Record in the United States
4
have caused over-billings. In 2008, the city had to write off
more than $1 million in unsubstantiated fees resulting from
incorrect rates, inaccurate estimates and unreliable meter
readings.32
Unapproved payments. United Water received at least $6
million in pass-through and other payments without the
proper city approval.33
Inadequate bill collection. United Water lacked an adequate
information system to track account data properly. At the be-
ginning of 2009, the utility had nearly $5 million in unpaid
customer bills that were at least 90 days old.34
Although the company disputed many of the audit’s findings,
the city agreed with every recommendation. At the end of
2009, Camden requested $29 million from United Water for
poor performance, unauthorized payments and credits for
capital projects conducted by the city.35 In January 2010, the
company responded by suing Camden alleging the city owed
it $6 million in back payments.36 Camden faces a potentially
lengthy court battle.
Milwaukee, Wisconsin
Billions of gallons of raw and partially treated sewage poured
into Lake Michigan and local streams after United Water took
over Milwaukee’s sewers in 1998. Many of the spills were
blamed on heavy rains, but others were the fault of employ-
ees and malfunctioning equipment.
In one incident alone, 1.5 billion gallons of raw sewage
spilled in May 2004, marking the second-largest mishap in
10 years. The Milwaukee Metropolitan Sewerage District
blamed the rain, but the accident led state legislators to call
for an investigation.37
The spill came one year after a district-appointed auditor
raised questions about United Water’s management, includ-
ing whether the company cut staff too drastically (from 300
to 209) and whether it had a sufficient inventory of spare
parts. A backlog of uncorrected problems had also accumu-
lated, some dating back more than a year.38
A year before this audit, a state review found that United
Water likely violated its contract by shutting down pumps to
cut costs — a practice that saved the company $515,000, but
also caused the dumping of more than 100 million gallons of
sewage.39
In 2002, the district blamed a dumping of toilet waste on
United Water’s poor maintenance of the sewer system, and
warned the company that “persistent and repeated failures”
could constitute a default that could void its contract.40
The 10-year, $300 million contract saved the district millions
of dollars, mainly by stabilizing the district’s energy prices,41
but at what environmental costs? And the company acknowl-
edged it lost money on the deal42 — a half-million dollars in
energy costs in May 2005 alone.43
In February 2008, after receiving at least 20 notices of
contract noncompliance for problems including sewage
overflows, the sewerage district decided against renewing the
deal, ending United Water’s largest contract.44
Gloucester, Massachusetts
United Water lost its contract in Gloucester, Massachusetts,
in 2009, after bacterial contamination left residents and busi-
nesses boiling their drinking water, some for 20 days.
The Massachusetts Department of the Environment fined
Gloucester $15,000 for water quality violations that resulted
in the 20-day boil-water order during the summer of 2009.
Food & Water Watch
5
The city blamed much of the problem on United Water’s
failure to take remedial action.45 State officials revealed that
at the time of the water contamination crisis, United Water’s
primary water operator for the city’s treatment plant lacked
the proper certification. Gloucester’s mayor indicated that
this violated the terms of United Water’s contract with the
city.46
In total, the city had to pay an extra $814,000 in fines,
consultant fees and other direct expenses because of the boil
order. In addition, individual local businesses reported losses
of as much as $140,000.47
When United Water’s contract came up for renewal later that
year, the city decided against keeping the company. Suez’s
United Water had operated Gloucester’s water and sewer
systems since 2007, when it acquired Earth Tech, a company
that had received a five-year contract in 2004.48
In 2010, the city demanded $1.3 million from United Water
claiming that the company performed poorly and violated
its contract during the water crisis. The company denied any
breach of contract and refused to compensate the city for
costs and revenue losses associated with the boil order, set-
ting the stage for a legal battle.49
Gary, Indiana
Gary, Indiana, canceled its contract with United Water after
12 years of expensive and poor service.
During a 1998 meeting, the Gary Sanitary District board,
without community input, voted to privatize its wastewater
treatment plant.50 The city council opposed the privatization,
and within a month, various council members had filed three
separate lawsuits challenging the proposal.51
Despite the lawsuits, which were unsuccessful,52 the sanitary
board moved forward with the deal.53 It awarded a 10-year,
$100 million contract to a partnership led by United Water,54
which bought out the other partners five years later in 2003.55
The sanitary district extended its contract with United Water
for another five years in 2008.56
Once the company took over the sewer system, it planned
to eliminate 62 jobs, half of the workforce, through attri-
tion.57 It offered a lump sum buyout to every employee. “It’s
a standard business practice, one that we have done at other
places,” the company’s communications manager explained
to the Post-Tribune, the local newspaper.58
With fewer workers to repair and maintain piping, it is no
surprise that poor service followed. Broken sewer lines cre-
ated sinkholes that went unaddressed for months.59 Between
2003 and 2007, there were more than 80 cave-ins as the
sewer lines fell apart.60 In May 2008, a state inspection found
United Water: Suez Environnement’s Poor Record in the United States
6
that the district, under United Water’s management, violated
discharge limits 84 times from 2005 to 2007, had at least 25
pieces of broken equipment, filed inadequate monitoring
reports and failed to meet mandated deadlines.61
Customers in towns surrounding Gary also experienced prob-
lems. In 2006, the sewer district nearly overcharged suburban
residents by $400,000. When lawyers for the outlying towns
contested the bills, United Water officials admitted that me-
ters at the plant had been malfunctioning for more than a year
and agreed to reduce the bills. Two years later, the company
still had not replaced the defective equipment.62
In 2007, federal investigators began scrutinizing the Gary
Sanitary District and United Water at the request of the Justice
Department and the U.S. Environmental Protection Agency.63
The next year, federal investigators raided the district’s of-
fices as part of their search for “evidence of environmental
crime.”64 As of March 2010, the investigation was ongoing
and focused on United Water, not the sanitary district.65
It was not poor performance, however, that caused United
Water to lose its contract in Gary, but finances. In 2010, the
Gary Sanitary District terminated its contract with United
Water to save millions of dollars a year. It expected public
operation to cut annual operating costs in half from more
than $16 million to $8 million.66
Examples of United Water’s Operations Included in this Report
Location Contract deals Problems
System Began Ended Lost contract Poor Upkeep Inadequate Service, Staffing
Water Quality Violations
High Costs
Atlanta, Georgia Drinking Water 1999 2003 x x x
Camden, New Jersey Drinking Water, Sewer 1999 (2019)
x x x
Fairfield-Suisun Sewer District, California
Sewer 2004 2008 x x x
Gary, Indiana Sewer 1998 2010 x x x x x
Gloucester, Massachusetts Drinking Water, Sewer 2004 2009 x x x x
Houston, Texas Drinking Water 1996 2001 x x
Laredo, Texas Drinking Water 2002 2005 x x
Milwaukee, Wisconsin Sewer 1998 2008 x x x x
North Brunswick, New Jersey Drinking Water, Sewer 1996 2006 x x
Food & Water Watch
7
Saving Money with Public Operation
In addition to Gary, Indiana, many other municipalities have
found United Water’s service to be too expensive. The fol-
lowing jurisdictions also terminated their contracts with the
company, finding that public operation is a much better deal
for ratepayers and taxpayers. They were able to realize cost
savings not possible with United Water running their water
systems.
North Brunswick, New Jersey
Expensive service caused North Brunswick, New Jersey, to
cancel its water and sewer contracts with United Water.
In 1996, North Brunswick entered into a 20-year, $200
million contract with U.S. Water, which was later acquired
by United Water.67 Over the term of the contract, the com-
pany agreed to pay the town a total of $54 million,68 which
residents would end up paying for as the company recovered
this fee through higher water bills.
Within three years, residents became inflamed and spoke
out against increased water charges. “Our bills used to be
$90 each quarter,” Debbie Calantoni, a resident of North
Brunswick, told the Star-Ledger, the local newspaper. “Now,
we pay an average of $230 each quarter. We paid about
$1,200 in 1998 for water and sewer. Our water isn’t better
and the service isn’t better.”69
Because of meter changes, many households saw their bills
double or even triple. “It’s become a model for the way not
to do such deals,” David Spaulding, the mayor at the time,
told the Star-Ledger, adding, “The people saw themselves get-
ting screwed.”70
Amid town discussions about ending its contract, United
Water made a last-ditch attempt to assuage the growing
public anger by offering to reduce the town’s rates by 22
percent. The ploy did not sway local officials.71 In 2002, the
town exited the water portion of its contract by buying out
the remaining 14-year term at a cost of $30 million.72
United Water retained the contract for the sewer system73 un-
til 2006, when the town council unanimously voted to termi-
nate the deal. The town wanted to manage the system itself.74
Public operation saved the township $140,000 in 2007.75
Houston, Texas
In 1996 United Water, formerly JMM Operational Services,
won a five-year, $16 million contract to operate and maintain
United Water: Suez Environnement’s Poor Record in the United States
8
one of Houston’s water treatment plants. At the end of the
term in 2001, the city decided against renewing the deal.
For the next few years the city and the company were em-
broiled in a legal battle over unpaid bills and multimillion-
dollar maintenance problems. The company sued the city, al-
leging that Houston owed it $900,000 for services performed
under the contract. The city responded with a countersuit
claiming that United Water’s poor maintenance of equipment
caused $2 million in damages.76
In September 2007, after six years of entanglement in a series
of appeals, the city and the company finally decided to drop
the case.77 Despite the inconclusive ending, the city spent at
least $370,000 on legal fees.78
The same year, the city kicked out the new private operator
of the treatment plant and brought the operation in-house.
The city expected to save 17 percent, or $2 million annually,
operating the plant with public employees.79
Fairfield-Suisun, California
The Fairfield-Suisun Sewer District in California ended its
sewer contract with United Water in order to save money
and improve service.
In January 2008, after nearly three decades of contracting out
the operation and management of its sewer treatment plant,
the Fairfield-Suisun Sewer District unanimously voted to
bring its system in-house and cancel its contract with United
Water.80
Independent consultants hired by the district found that
public operation would reduce operational costs by 10 to 15
percent81 while offering better benefit packages.82 The district
would achieve these savings by removing overhead costs as-
sociated with the company’s profits, which were expected to
be as much as 20 percent of the value of the contract.83
By investing in the workforce instead of profits, the district
expected service to improve. Its more competitive compensa-
tion packages should better attract and retain staff from the
increasingly limited pool of qualified applicants.84 United
Water and the previous contract operator, on the other hand,
had failed to maintain a steady management team, which
hurt their performance.85 There were five different plant
managers over the preceding five-year period,86 and the
maintenance manager position was vacant at the time of the
consultants’ assessment.87
The company’s inability to maintain adequate staffing poten-
tially posed serious risks for the district. Because the district
owned the sewer system, it was ultimately responsible for
compliance and workplace safety even when it contracted
out the operations.88 Indeed, privatization failed to transfer
risk to the private sector. Kathy Hopkins, the general manager
of the district, noted this failure as a reason to resume public
operation of the sewers. “We can’t push off risk anymore,”
she told Public Works Financing, a trade publication, “so we
might as well take back control.”89
Laredo, Texas
Laredo, Texas, turned over its water system to United Water
in 2002 on the expectation that it would save enough money
to help dig a well to supplement the drinking water it pumps
from the over-tapped Rio Grande.90
The company failed to deliver on its promises. After two
years of operating Laredo’s water system, United Water want-
ed to increase its annual payments, which would have made
private operation $1 million more expensive than public
Food & Water Watch
9
operation had been.91 Blaming its underachievement on the
city’s aging infrastructure, United Water asked the city for $5
million for previous unexpected expenses plus an additional
$3 million a year. City officials refused, one saying the com-
pany knew what it was getting itself into, and another calling
the corporation’s claims “bogus.”92
Halfway through its five-year, $47 million contract, the com-
pany wanted out of the deal.
In March 2005, Suez paid the city $3 million to exit the
contract early.93
City officials said they learned a lesson. “They tried to do
what they could, but at the end of the day it wasn’t going to
work,” Councilman Jose Valdez, Jr. said of United Water. “I’m
just glad to see them go.”94
Conclusion
Failure mars Suez’s endeavors in the United States. Suez’s
United Water has delivered a host of problems from contami-
nated drinking water in Gloucester, Massachusetts, to sewage
spills in Milwaukee, Wisconsin. These disappointing results
reflect not only on United Water, but also on the private wa-
ter services industry as a whole. Private operation of munici-
pal water and sewer systems often forces consumers to pay
more for worse service.
Across the United States — from Fairfield, California, to
Houston, Texas, to Gary, Indiana — cities have found that
public operation is a better deal for residents. They have re-
claimed their water systems, canceling contracts with United
Water, to reduce costs and improve services.
Confronted with these failures, water corporations like Suez
have sought new business by trying to capitalize on the
growing infrastructure crisis besieging many of the nation’s
drinking water and clean water systems. The companies pres-
ent themselves as solutions to repair and update aging and
crumbing utilities, but privatization is not the answer. When
private interests control water resources, water rates often
skyrocket and services deteriorate.
Reliable public operation is a better option that allows mu-
nicipalities to responsibly address water infrastructure needs.
Because of the scale of improvements necessary to ensure
safe and clean water, the United States should establish a
dedicated source of public funding through a clean water
trust fund to help rejuvenate water and sewer systems and
protect public health. A federal trust fund for water resources
would alleviate some of the financial pressure that compels
cash-strapped municipalities to privatize their water systems
to private companies like Suez. Public funding for public
utilities will help ensure that safe, clean and affordable water
service is available for generations to come.
United Water: Suez Environnement’s Poor Record in the United States
10
Endnotes
1 United Water. Securities and Exchange Commission. S-4/A. February
3, 1994; Verdon, Joan. “Presenting a global vision on conservation.” The Record. September 16, 2009; Chertoff, Larry. “Economic patriotism
casts a shadow over United.” Global Water Intelligence, vol. 7, iss. 4.
April 2006; “PWF’s 14th annual water partnerships report.” Public Works
Financing, vo. 247. March 2010 at 7; Suez Environnement. French
Financial Markets Authority. Reference Document 2009. April 12, 2010 at
68.
2 Campagnie Financière de Suez became a majority shareholder of
Lyonnaise des Eaux in 1974. In 1997 La Lyonnaise des Eaux merged with
Compagnie Financière de Suez creating Suez Lyonnaise des Eaux, which
changed its name to Suez in 2001. Suez Environnement was spun off in 2008 when Suez merged with Gaz de France to form GDF Suez, which
owned more than one-third (35 percent) of Suez Environnement at the end of 2008. For more information see: Suez Environnement. French
Financial Markets Authority. Reference Document 2008. April 14, 2009 at 31 to 32.
3 IU International. [Press Release]. “IU sells half interest in subsidiary.” September 16, 1982; IU International Corp. [Press Release]. “IU com-
pletes sale of General Waterworks to French firm.” July 19, 1985; GWC Corp. [Press Release]. “GWC Corp reports 1985 earnings.” February 28,
1986.4 United Water Resources, Inc. Securities and Exchange Commission. Form
10-K. March 28, 1995 at 2.5 “Company news; United Water and GWC in a stock swap merger.” The
New York Times. April 23, 1994.6 United Water Resources, Inc. Securities and Exchange Commission. Form
10-K. March 30, 1994 at 8 to 10.7 The partnership purchased the remaining half of JMM Operational
Services that it did not already own. It was renamed United Water Services. United Water Resources, Inc. Securities and Exchange
Commission. Form 10-K405. March 25, 1998 at 3.8 Before the merger, Suez owned 33 percent of United Water Resources,
Inc. It bought out the remaining 67 percent. See: United Water Resources, Inc. Securities and Exchange Commission. Form 8-K filing. July 31, 2000.
9 Suez Environnement. French Financial Markets Authority. Reference Document 2008. April 14, 2009 at 70; “Suez completes United Water
Resources acquisition.” Global Water Intelligence, vol. 1, iss. 8. August 2000.
10 “Suez’s US strategy: United forever.” Global Water Intelligence, vol. 7, iss. 12. December 2006.
11 “US outsourcing activity picks up.” Global Water Intelligence, vol. 10, iss. 4. April 2009 at 9; “PWF’s 12th annual water outsourcing report.” Public
Works Financing, vol. 255. March 2008 at 5; “PWF’s 14th Annual Water
Partnerships Report.” Public Works Financing, vol. 247. March 2010 at 7.
12 Suez Environnement. “Consolidated financial statements of Suez
Environnement Company for the fiscal years December 31, 2009 and
2008.” February 25, 2010 at 3.
13 Suez Environnement. [Press Release]. “Annual results 2009.” February 25,
2010.
14 Suez Environnement. “2009 Full year results presentation.” February 25,
2010 at 56.15 Suez Environnement. French Financial Markets Authority. Reference
Document 2009. April 12, 2010 at 68.16 Ibid. at 68.
17 Suez Environnement. “2009 Full year results presentation.” February 25, 2010 at 56.
18 Suez Environnement. French Financial Markets Authority. Reference Document 2009. April 12, 2010 at 68.
19 Suez Environnement. “2009 Full year results presentation.” February 25, 2010 at 56.
20 Cheroff, Larry. “US private firms shrink from weak deals.” Global Water Intelligence, August 2003; Hairston, Julie B., “Atlanta Bid Could Be
Fierce,” Atlanta Journal-Constitution. April 9, 1999; Campos, Carlos. “Atlanta water flows to United.” Atlanta Journal-Constitution. January 1,
1999.21 United Water Resources, Inc. Securities and Exchange Commission. Form
10-K405. March 24, 2000 at 45; United Water Resources, Inc. Securities and Exchange Commission. Form 8-K. July 31, 2000.
22 Rubenstein, Sarah. “City blasts United Water,” Atlanta Business Chronicle, August 9, 2002; City of Atlanta, Georgia. [Press Release]. “Mayor Shirley
Franklin initiates review of United Water contract.” June 10, 2002; del Rosario, Remedios K. Department of Water, City of Atlanta, Georgia.
“Memorandum: United Water Services Atlanta performance issues.” To DeWayne Martin, Chief Operating Officer. September 13, 2001.
23 Bennett, D.L. “Ex-mayor denies he signed off on water.” The Atlanta Journal-Constitution. October 5, 2002.
24 Torpy, Bill. “Campbell divides Atlanta – again.” The Atlanta Journal-Constitution. January 15, 2006; Whitt, Richard. “Campbell indicted.” The
Atlanta Journal-Constitution. August 31, 2004; Scott, Jeffry. “Closing argu-ments wind up case today.” Cox News Service, March 7, 2006.
25 Scott, Jeffry. “Closing arguments wind up case today.” Cox News Service, March 7, 2006.
26 Torpy, Bill et al. “The Bill Campbell verdict: Split decision: Ex-mayor cleared of public corruption; conviction on tax evasion charges could
lead to prison time.” The Atlanta Journal-Constitution. March 11, 2006; Torpy, Bill et al. “Prison for ex-mayor.” The Atlanta Journal-Constitution.
June 14, 2006. 27 Roberts, Kristin. “US water privatization effort trips in Atlanta.” Reuters,
Jan. 29, 2003.28 Chertoff, Larry. “US private firms shrink from weak deals.” Global Water
Intelligence, August 2003.29 City of Atlanta, Georgia. “A resolution authorizing the mayor to execute
on behalf of the city, a mutual dissolution agreement with United Water Services Unlimited Atlanta LCC…” 03-R0192. Approved by Mayor March
11, 2003; Suggs, Ernie. “Council agrees to end water deal, rejects gag rule.” The Atlanta Journal-Constitution. March 4, 2003.
30 Boxer, A. Matthew. Office of the State Comptroller, State of New Jersey. “A Performance Audit of the Management Services Agreement for the
City of Camden’s Water and Wastewater Collection Systems.” (PA-06). December 16, 2009 at 1, 2 and 5; Ott, Dwight and Jon Stenzler. “Water
deal is approved in Camden.” The Philadelphia Inquirer. November 7, 1998; Office of the State Comptroller, State of New Jersey. [Press release].
“State Comptroller finds Camden’s mismanagement of water contract cost taxpayers millions.” December 16, 2009.
31 Boxer, A. Matthew. Office of the State Comptroller, State of New Jersey. “A Performance Audit of the Management Services Agreement for the City of
Camden’s Water and Wastewater Collection Systems.” (PA-06). December 16, 2009 at 16 to 17.
32 Ibid. at 6 and 9 to 14.33 This includes $3.8 million in unapproved pass-through charges and $2.2
million for costs associated with a contract amendment that the city did not approve. See: Ibid. at 5 to 6 and 23 to 27.
34 Ibid. at 21 to 22.35 Ibid. at 40 and Appendix C: United Water Response.
36 Walsh, Jim. “Water utility seeks $5.7M from Camden.” Courier Post. January 30, 2010.
37 Schultze, Steve and Marie Rohde. “Dumping of sewage second largest ever.” Milwaukee Journal Sentinel. May 20, 2004; State of Wisconsin,
Legislative Audit Bureau. “An Evaluation: Milwaukee Metropolitan Sewerage District.” (02-12). July 2002 at 3.
38 Milwaukee Metropolitan Sewerage District. “United Water Performance Evaluation.” (TS-2386). June 20, 2003 at 1 to 3 and ES-2 to ES-4; Rohde,
Marie. “Review raises concerns about sewerage upkeep.” Milwaukee Journal Sentinel, June 24, 2003.
39 State of Wisconsin, Legislative Audit Bureau. “An Evaluation: Milwaukee Metropolitan Sewerage District.” (02-12). July 2002 at 35 to 36; Schultze,
Steve and Marie Rohde. “Sewage dumping policies faulted.” Milwaukee Journal Sentinel. July 31, 2002.
40 Rohde, Marie. “Improper maintenance blamed in dumping.” Milwaukee Journal Sentinel. September 21, 2002.
41 Behm, Don. “MMSD won’t renew deal with operator.” Milwaukee Journal Sentinel. November 16, 2007; Behm, Don. “N.J. Firm to get nearly $300
million over 10 years.” Milwaukee Journal Sentinel. January 6, 1998.42 Rohde, Marie. “United Water delivering savings in 10-year contract.”
Milwaukee Journal Sentinel. June 16, 2003.43 Ryan, Sean. “Milwaukee Metropolitan Sewerage District saves money by
using private contractor.” Milwaukee Daily Reporter. August 17, 2005. 44 Behm, Don. “MMSD won’t renew deal with operator.” Milwaukee Journal
Sentinel, Nov. 16, 2007; “PWF’s 12th Annual Water Outsourcing Report.” Public Works Financing, vol. 225. March 2008 at 5.
45 Anderson, Patrick. “State fines city, cites water woes.” Gloucester Daily Times. December 3, 2009.
46 Anderson, Patrick. “DEP: Water plant operator wasn’t properly licensed.” Gloucester Daily Times. September 21, 2009.
47 Anderson, Patrick. “Water firm nixes city’s $1.3M claim.” Gloucester Daily Times. March 27, 2010.
48 Anderson, Patrick. “French company controls water.” Gloucester Daily Times. November 13, 2009.
Food & Water Watch
11
49 Anderson, Patrick. “Water firm nixes city’s $1.3M claim.” Gloucester Daily Times. March 27, 2010; Anderson, Patrick. “City files $1.3M claim over
water.” Gloucester Daily Times. February 9, 2010. 50 Caldwell, Lori. “Sewage plant goes private.” Post-Tribune (IN). February
11, 1998.51 Caldwell, Lori. “Privatize lawsuits adding up.” Post-Tribune (IN). March 6,
1998.52 Caldwell, Lori. “Council’s lawsuit dismissed.” Post-Tribune (IN). June 6,
1998.53 Caldwell, Lori. “Sanitary district bid ok’d.” Post-Tribune (IN). April 11,
1998.54 “Suez Lyonnaise des Eaux’s U.S. joint venture, United Water Services,
wins wastewater contract in Gary, Indiana.” Business Wire, June 9, 1998.55 Zorn, Tim. “Name to change at Gary sewers.” Post-Tribune (IN). August
10, 2003.56 United Water. [Press release]. “United Water and Gary Sanitary District
sign five-year extension for wastewater contract.” May 27, 2008.57 Caldwell, Lori. “Workers offered bid for buyout.” Post-Tribune (IN). June
3, 1999; Caldwell, Lori. “City sewer spat spills into court.” Post-Tribune (IN). March 2, 1998.
58 Caldwell, Lori. “Workers offered bid for buyout.” Post-Tribune (IN). June 3, 1999,
59 Zorn, Tim. “Filling in sewer sinkholes a big task for Gary.” Post-Tribune (IN). August 2, 2003.
60 Siedel, Jon. “Gary makes new push for sewer repair.” Post-Tribune (IN). February 10, 2008.
61 Kraly, Christine. “Report: Sewage plant violated rules.” The Northwest Indiana and Illinois Times. October 23, 2008.
62 Grimm, Andy. “Feds looking into Gary Sanitary’s plant operations.” Post-Tribune (IN). April 6, 2008.
63 Ibid.; Seidel, Jon. “Feds to look at sanitary records.” Post-Tribune (IN). June 8, 2007.
64 Kraly, Christine. “Report: Sewage plant violated rules.” The Northwest Indiana and Illinois Times. October 23, 2008.
65 Seidel, Jon. “United Water still hoping to salvage GSD contract.” The Post-Tribune. March 27, 2010.
66 Seidel, Jon. “Gary Sanitary District ends contract with United Water.” The Post-Tribune. March 26, 2010.
67 George, Dana Yvette. “North Brunswick passes utility plan.” Star-Ledger. February 13, 1996; United Utilities PLC. [Press Release]. “US Water wins
long-term concession contract in New Jersey, USA.” March 11, 1996; United Water. [Press Release]. “United Water acquires U.S. Water’s water
and wastewater contract operations.” August 1, 2002.68 George, Dana Yvette. “North Brunswick passes utility plan.” Star-Ledger,
February 13, 1996; “No. Brunswick may privatize water.” The Star-Ledger. January 30, 1996.
69 Gallotto, Anthony. “Customers fuming over rising utility rates.” Star-Ledger. January 24, 1999.
70 Sherman, Ted. “Liquid assets: for those seeking new markets, water sys-tems are a potential money machine.” Star-Ledger. October 1, 2003.
71 Margolin, Josh. “Utility offering rate cut of 22%.” Star-Ledger. March 27, 2001.
72 Goldberg, Dave. “Water contract presented to public.” North Brunswick Sentinel. May 9, 2002.
73 Albright, Scott. “North Brunswick, N.J., votes for new water contract.” Home News Tribune. July 3, 2002.
74 North Brunswick Township, New Jersey. “An ordinance authorizing the termination of the wastewater services agreement for the ownership of
North Brunswick’s wastewater system by and among the township of North Brunswick, The Middlesex County Improvement Authority and
United Water as successor-in-interest to U.S. Water Service Company LLC.” (#06-10). May 23, 2006.
75 Amato, Jennifer. “Proposed budget would carry 4-cent tax hike.” Home Town Sentinel. September 21, 2006; North Brunswick Township, New
Jersey. Minutes. Regular meeting. May 15, 2006 at 4.76 Colley, Jenna. “Legal deluge inundates first city water plant privatization
effort.” Houston Business Journal, vol. 33, iss. 14. August 16, 2002 at 7; City of Houston, Plaintiff; vs. Continental Insurance Co., Defendant, vs.
United Water Services, Inc., third-party defendant. Civil Action H-02-2734, Opinion by U.S. District Judge Gray H. Miller, United States
District Court for the Southern District of Texas, Houston Division, Decided July 26, 2007.
77 City of Houston, Appellant v. United Water Services, Inc., Appellee. No. 01-07-00559-CV, Court of Appeals of Texas, First District, Houston.
September 20, 2007; City of Houston, Plaintiff, v. Continental Insurance Co., Defendant, v. United Water Services, Inc., Third-Party Defendant,
Civil Action No. H-02-2734, “Agreed Take Nothing Judgment” by Gray H. Miller, United States District Judge, United States District Court for the
Southern District of Texas, Houston Division. September 17, 2007.78 Colley, Jenna. “Legal deluge inundates first city water plant privatization
effort.” Houston Business Journal, vol. 33, iss. 14. August 16, 2002 at 7.79 “PWF’s 12th annual water outsourcing report.” Public Works Financing,
vol. 225. March 2008 at 12 to 14.80 Eberling, Barry. “Sewage board to have district run plant.” Fairfield Daily
Republic. January 29, 2008.81 Fairfield-Suisun Sewer District. Board of Directors Meeting Agenda.
January 28, 2008 at 44.82 Ibid. at 56.
83 Ibid. at 55 and 58; “PWF’s 12th annual water outsourcing report.” Public Works Financing, vol. 225. March 2008 at 14.
84 Fairfield-Suisun Sewer District. Board of Directors Meeting Agenda. January 28, 2008 at 62.
85 Ibid. at 53.86 Ibid. at 45.
87 Ibid. at 59.88 Ibid. at 45, 46, 53 and 54.
89 “PWF’s 12th annual water outsourcing report.” Public Works Financing, vol. 225. March 2008 at 16.
90 Pfister, Bonnie. “Laredo, Texas, officials approve deal with New Jersey-based water company.” San Antonio Express. May 10, 2002; Cortez,
Tricia. “Vote on privatization contract due in May.” Laredo Morning Times. April 26, 2002; Crow, Kirsten. “Secondary water source opens for Webb
County.” Laredo Morning Times. September 2, 2006.91 Cordova, Erica. “City takes back water duty.” Laredo Morning Times.
March 19, 2005.92 Ibid.; Cordova, Erica. “City may retake system.” Laredo Morning Times.
Feb. 22, 2005.93 Cordova, Erica. “City takes back water duty.” Laredo Morning Times.
March 19, 2005; Pfister, Bonnie. “Laredo, Texas, officials approve deal with New Jersey-based water company.” San Antonio Express. May 10,
2002.94 Cordova, Erica. “City takes back water duty.” Laredo Morning Times.
March 19, 2005.
Food & Water Watch
Main Office
1616 P St. NW, Suite 300
Washington, DC 20036
tel: [phone]
fax: [phone]
[e-mail]
www.foodandwaterwatch.org
California Office
25 Stillman Street, Suite 200
San Francisco, CA 94107
tel: [phone]
fax: [phone]
[e-mail]
(/)
LOCALLY OWNED SINCE 1854
Welcome! Log in (/login.html) Register (/register/)
Search
MAIN MENU

Download 5S Guide - Free Step-by-Step Guide
27-Page Expert 5S Guide. "This is a great guide! I read it from cover to cover"
graphicproducts.com
OPEN
 You have 1 free item remaining before a subscription is required. Subscribe now! (/subscribe/?town_id=0)
Do these lawsuits over Suez water and sewer
lease make sense nancially?: Editorial
Posted Wednesday, June 27, 2018 11:06 am
Why is the borough of Middletown spending what is potentially hundreds of thousands of dollars in legal fees over its 50-year water and sewer lease with Suez?
What end benet is there to the borough and its residents, nancially or in terms of quality of service? What is the best-case scenario for the lawsuits led against:
• Middletown Water Joint Venture LLC, which includes Suez. The borough led suit in Dauphin County Court, seeking to block Suez from imposing an 11.5 percent
surcharge being added to water and sewer bills because of a water use shortage during the last several years.
• Its former solicitor (McNees Wallace & Nurick) and former nancial consulting rm (Susquehanna Group Advisors Inc.), both of which provided advice in 2014
regarding the borough’s decision to go through with the lease.
The borough believes that the surcharge involves a level of water use that was impossible to meet, making the additional fee a foregone conclusion. It also believes
McNees Wallace & Nurick and Susquehanna Group Advisors Inc. advised them poorly.
(/uploads/original/20180627-110613-hammer-719061_1920.jpg)
Report an inappropriate comment (/report_item.html?sub_id=35757&referring_url=%2Fstories%2Fdo-these-lawsuits-over-suez-make-sense-financially-editorial%2C35757)
It’s possible these claims are true. If the borough was wronged, then looking at ways to make it right is admirable. Protecting borough residents is part of its job. It’s
possible that if the borough wins its suits against McNees Wallace & Nurick and Susquehanna Group Advisors Inc. that it will recoup some of its legal fees. And make no
mistake, there will be some big bills coming.
Eckert Seamans is the new rm hired to be the borough’s solicitor.
The borough also has hired Gibson & Perkins, a Media-based law rm, to “investigate potential claims” against “borough professionals and/or individuals who provided
advice and representation or direction during the drafting and negotiation of the lease,” according to council’s motion to hire the rm. The borough is paying $5,000 to
retain Gibson & Perkins. Hourly rates are $300 and $350 an hour, depending on the attorney doing the work.
The law rm of Dilworth Paxson is representing the borough in the lawsuit regarding the surcharge now before federal court Chief Judge Christopher C. Conner. The
borough is paying Dilworth Paxson “a blended hourly rate of $400.”
Bills totaling tens of thousands of dollars have already come to the borough council.
Council also during the April 17 meeting hired cb3 Solutions LLC of Bellefonte, as a consulting engineering rm related to the lease lawsuit. The borough will pay cb3
Solutions $105 an hour for consulting, and $180 an hour for expert witness testimony.
It’s clear what the legal action against McNees and Susquehanna is intended to do: Recoup money for what the borough considers poor advice on the lease.
More hazy is the end game with Suez. The current council — none of whom were members of the body when the agreement was signed — don’t like the decision that
the previous council made, and believes bad advice was given.
Is the borough trying to get out of the lease? That “would be a blessing if we could accomplish that,” Council President Damon Suglia told the Press & Journal on May 4.
“It would better suit our town if this water and sewer would be back under control” of the borough, as it was before the lease went into effect on Jan. 1, 2015.
We doubt Suez shares his point of view. And we are sure it’s not going to simply allow the borough to keep the $43 million up-front payment it made when the lease
started.
What is the cost to you of the surcharge? For residential customers, it’s about 20 cents a day, Suez has said — roughly $6 a month, or about $72 a year. We realize for
people living on a xed income or paycheck to paycheck that $72 a year is not an insignicant amount.
Also, starting in January 2019, residents and businesses will see an annual rate hike equal to the rate of ination and continuing for each of the remaining 46 years of
the lease, Suez has said. So yes, rates will rise. But of course rates are going to rise over the course of such a long lease.
We are surprised that Suglia contends the borough isn’t better off today because of the lease — despite getting the $43 million payment that made the borough debt
free overnight, by retiring all of Middletown’s pension debt and debt tied to building a new wastewater treatment plant. Also, annual payments to the borough over the
50 years will exceed another $45 million.
Asked how the borough could repay $43 million, Suglia told us: “Long-term bonds is one possibility of getting the funds.”
Is it wise for the borough to take on debt, even though the borough got out from under it through the lease, so that residents won’t pay a $72-a-year surcharge? If the
borough takes on debt through long-term bonds, who will pay? That’s right — the residents are still on the hook in the long run.
Borough ofcials have stated in testimony regarding the water usage lawsuit that the surcharge will be a deterrent to businesses and potential residents moving here,
and that some current residents will get fed up and move away because of it. We don’t buy into that argument. If the ght costs more than the benet, then why do it?
Also remember that if the borough takes over the water and sewer service again, it will have to hire employees to run it, incurring more costs.
Here’s a suggestion. Take those annual payments to the borough over the next nearly 50 years that will exceed $45 million and each year pay Suez to offset the
surcharge, and maybe a bit of the annual rate increases as well.
This entire situation is very complicated. We urge the borough council to give specics to Middletown residents and businesses about:
• How much is expected to be spent on legal fees related to the water and sewer lease.
• What is the expectation for the lawsuits against McNees and Susquehanna if they win.
• What kind of costs will there be if the borough is forced to take on long-term bonds if the lease is broken and the $43 million must be repaid. Would that cost be more
or less for residents than simply riding out the last 4 1/2 decades of the lease?
We assume borough ofcials have these answers. Discussing the numbers would bring some clarity.
Is it worth winning the lawsuits if it costs residents more money in the long run?
OTHER ITEMS THAT MAY INTEREST YOU
Tweet Share 0 Share
0 Comments Sort by
Facebook Comments Plugin
Oldest
Add a comment...
Bob Reid is a Middletown treasure: Editorial (/stories/bob-reid-is-a-middletown-treasure-editorial,54052)
Sound familiar? Which governor said this?: Mike Folmer (/stories/sound-familiar-which-governor-said-this-mike-folmer,54051)
(/)
LOCALLY OWNED SINCE 1854
Welcome! Log in (/login.html) Register (/register/)
Search
MAIN MENU

 You have reached the limit of 2 free items per week. Subscribe now for continued access (/subscribe/?town_id=0).
Will borough try to get out of the 50-year Suez
water and sewer lease? Suglia hints it's possible
Suez personnel wrap up fire hydrant testing and flushing on Friday, Sept. 30, 2016. This hydrant is at the corner of East Emaus and North Pine streets.
STAFF PHOTO BY JASON MADDUX
Posted Wednesday, May 9, 2018 3:19 pm
By Dan Miller

[e-mail] (mailto:[e-mail])

717-944-4628
Middletown might be laying the groundwork for getting out of the 50-year lease of the borough’s water and sewer systems to Suez, based on comments from Council
President Damon Suglia following council’s May 1 decision to hire another law rm regarding the lease issue.
Getting out of the lease “would be a blessing if we could accomplish that,” Suglia told the Press & Journal on May 4. “It would better suit our town if this water and
sewer would be back under control” of the borough, as it was before the lease went into effect on Jan. 1, 2015.
Council following a closed-door executive session voted 5-0 on May 1 to hire the Media-based law rm Gibson & Perkins to “investigate potential claims” against
“borough professionals and/or individuals who provided advice and representation or direction during the drafting and negotiation of the lease,” according to a motion
read by Council Vice President Dawn Knull.
The borough is paying $5,000 to retain the rm. Hourly rates are $300 and $350 an hour, depending on which attorney does the work, borough Manager Ken Klinepeter
said.
The borough on April 16 led a lawsuit in Dauphin County Court against Middletown Water Joint Venture LLC and Suez, seeking an injunction to block Suez from
imposing an 11.5 percent surcharge on water and sewer bills.
The surcharge remains on the bills, although a hearing is set in federal court for 10 a.m. Thursday, May 17, to consider the borough’s request for an injunction. It will be
held in Courtroom 4 on the eighth oor of the federal courthouse at 228 Walnut St. in Harrisburg, according to an order led with the court on May 2 by Chief Judge
Christopher C. Conner, who is presiding over the case.
The hearing had been set for Wednesday, May 9. Conner gave no reason in his order for delaying the hearing.
The lawsuit was transferred from county court to U.S. Middle District federal court in response to papers led by attorneys for the joint venture.
According to the lawsuit, the borough’s complaint is focused on blocking the surcharge, and on amending provisions in the lease regarding how Suez calculates a water
sales shortfall.
Suez imposed the surcharge to make up for lost revenue from the borough having a water sales shortfall during over the rst three years of the lease, from Jan. 1, 2015
through 2017.
However, the borough contends the water sales shortfall formula as written in the lease creates a nancial “windfall” for the joint venture and Suez, at the expense of
sharp increases in water and sewer bills for Middletown residents and businesses.
Representing the borough in the lawsuit is Dilworth Paxson. The borough hired the law rm following a March 6 council executive session. Council took a public vote
on April 17 to ratify hiring Dilworth Paxson.
According to Suglia, council hired Gibson & Perkins to investigate how the borough got into “this predicament,” meaning the 50-year lease.
Council by 7-2 vote in September 2014 approved entering into the lease with Suez, then known as United Water. The same night the former borough authority voted 4-1
to enter into the lease. The authority no longer exists, having been dissolved as a result of the lease.
The September 2014 approvals by council and the authority commenced a period of negotiations between the borough and the joint venture and Suez, toward
hammering out a nal contract governing terms of the 50-year lease.
No one on the current seven-member council was in ofce at the time, including Suglia who was elected in November 2015.
The last councilor who was in ofce when the lease was approved and negotiated — Ben Kapenstein — has resigned from council effective May 1.
A nancial analyst elected to council in 2013, Kapenstein chaired a committee that council formed in 2014 to explore the feasibility of leasing the water and sewer
systems.
Kapenstein advocated leasing the systems, and was among the seven councilors voting for leasing the systems to United Water during the September 2014 meeting.
“When this whole deal was struck it was not transparent at all,” Suglia said. “It was controlled by I feel a lot of backdoor politics.”
“We are trying to bring this out into the open and to show our citizens exactly what happened, to do whatever we can to protect our citizens as well as by ling this
suit,” Suglia said, referring to the federal lawsuit against the joint venture.
Klinepeter after the vote to hire Gibson & Perkins referred to potential “liability claims” arising from the rm investigating people and entities that were advising the
borough while the lease was being drafted and negotiated.
Klinepeter would not speculate on who is to be investigated, or whether the parties were hired by the borough, worked directly for the borough at the time, or both.
“We don’t know at this point,” Klinepeter said. “We will follow where this goes and determine what the next steps are with this rm, depending on where these cases
end up. … This is just an engagement to investigate the potential.”
Kapenstein in a deposition led as part of the borough lawsuit said that council and the borough in 2014 relied on its “professional advisors to make sure the borough
was protected” regarding the water sales shortfall provision.
“We did not expect that provisions such as the water sales shortfall would have any material impact on retail water rates over the term of the lease unless something
completely unexpected happened, and we were relying on our professional advisers, McNees Wallace & Nurick and Susquehanna Group Advisors, to provide appropriate
guidance,” according to Kapenstein’s deposition.
McNees Wallace & Nurick was borough solicitor from January 2012 until April 17, when council replaced it with Eckert Seamans.
The action followed council on March 14 deciding to seek proposals from law rms to serve as solicitor. McNees Wallace & Nurick did not submit a proposal.
McNees Wallace & Nurick received an estimated $400,000 to $600,000 in legal fees for its role in the lease transaction, according to a statement   during the September
2014 public meeting before council voted to approve the lease deal.
Susquehanna Group Advisors is a nancial consulting rm that worked for the borough at the time of the lease. It received 1 percent of a $43 million up-front payment
— $430,000 — that the joint venture gave the borough in 2014 in return for council and the authority agreeing to the lease.
Susquehanna has not worked for the borough since 2016 when the borough brought its nancial operations in house.
Asked if McNees Wallace & Nurick and Susquehanna Group Advisors are among those Gibson & Perkins will be investigating regarding their role in the lease deal,
Suglia said “I feel some of those entities you mentioned helped get the borough into the position it is now.”
“Who is responsible for this? Was it (Chris) McNamara and his regime?” Suglia continued, referring to the former council president who led council from January 2012
until McNamara lost in his bid for re-election in 2015. “Was it the water and sewer authority? Who was it? Let’s get to the bottom of this. We are looking at everyone
who was involved in this, the actual writing and signing of the lease.”
Suglia contends the borough isn’t better off today because of the lease — despite getting the $43 million payment that made the borough debt free overnight, by
retiring all of Middletown’s pension debt and debt tied to building a new wastewater treatment plant.
Report an inappropriate comment (/report_item.html?sub_id=33558&referring_url=%2Fstories%2Fwill-borough-try-to-get-out-of-the-50-year-suez-water-and-sewer-lease%2C33558)
Being in debt is “not a bad thing,” Suglia said, adding that most local governments in the country are in debt to some degree.
“It was a poor move on the former council’s part to pen such a deal. They created a long-term problem in exchange for a short-term solution.”
If the borough can get out of the lease, Suglia acknowledged the borough may have to repay the $43 million up-front payment to the private investors backing the joint
venture.
Asked how the borough can do this, Suglia responded “long-term bonds is one possibility of getting the funds.”
Beyond that, “I’m not the nancial guy. Ben always was,” Suglia said, referring to Kapenstein.
OTHER ITEMS THAT MAY INTEREST YOU
Tweet Share 0 Share
Middletown man in prison tried to have his wife killed so she couldn't testify against him, DA says (/stories/middletown-man-tried-to-have-his-wife-killed-while-he-was-in-prison-so-she-couldnt-testify,54175)
D&H gets zoning change approval from Lower Swatara, paving way for two warehouses (/stories/dh-gets-zoning-change-approval-from-lower-swatara-paving-way-for-two-warehouses,54172)
Borough says $1.1 million isn’t missing; it won’t release details as to where it is, leading to Right-to-Know request by P&J(/stories/borough-says-11-million-isnt-missing-however-it-wont-release-details-as-to-where-it-is,54091)
Hometown heroes honored with medals; Dixon, Young get Carnegie recognition for car re actions (/stories/hometown-heroes-honored-with-medals-dixon-and-young-receive-carnegie-recognition-for-car-re,54090)
(http://pressandjournal.ads.communityq.com/www/delivery/ck.php?
oaparams=2__bannerid=161__zoneid=1__cb=4177aacef7__oadest=http%3A%2F%2Fwww.candjcatering.com%2F)
0 CommentsSort by
Facebook Comments Plugin
Oldest
Add a comment...

Hoboken files lawsuit against Suez, demands it
halt all capital improvement projects
Posted Aug 30, 2018
Mayor Ravi Bhalla speaks during a press conference Tuesday. The city on Wednesday filed a lawsuit against
Suez, the company that operates its water system. (Corey W. McDonald | The Jersey Journal)

By Corey W. McDonald | The Jersey Journal
HOBOKEN -- The city is demanding that Suez, the company that operates its water system, halt all of its major capital
projects and focus on preventing water main breaks throughout the city, according to a lawsuit filed Wednesday.
The lawsuit, filed in Hudson County Superior Court, claims that Suez has been "woefully inadequate" in ongoing efforts
to repair or prevent future main breaks, and has been "unable or unwilling" to determine a cause for the frequency of
the breaks.
Specifically, the suit targets a major capital improvement project that began on June 23 and said that since construction
began, the city has experienced "no less" than 15 breaks, citing numerous examples throughout the months of July and
August.
The suit targets a meter chamber project in nearby Jersey City which houses two water meters that regulate water
pressure for the city.
"An impaired or unreliable water supply system presents a danger to the health, safety and welfare of the residents of
the city, and immediate action is required ... to ensure the water supply system if operating effectively and the residents
and property in the city are protected from the dangers presented by near constant flooding," the lawsuit reads.
Suez, in a response, said the legal action is a "waste of time, money and energy that could be better used for solving the
real problem causing water main breaks in Hoboken -- the age of the system and its pipelines."
"More than 50% of Hoboken's pipes were put in place in the late 1800s and early 1900s. They have far outlasted their
usefulness. Hoboken's residents deserve better service from their water system," the statement reads.
Suez, formerly United Water, has been contracted with the city since 1994, and has twice extended the contracts
lifespan by ten years -- once in 2004, and again in 2014.
At issue is a discrepancy in statistics carried by the company and Hoboken. Mayor Ravi Bhalla, in a press conference on
Tuesday, called the frequency of breaks in the summer months an "anomaly."
Rich Henning, a senior vice president of Suez, said during a press conference that for the past 17 years, the city has
averaged 12 water main breaks during the months of July and August -- on par with what the city cast as an anomaly.
Annually, the city has averaged 111 water main breaks, about one break every three days, Henning added.
The lawsuit seeks injunctive relief requiring Suez cease construction on all capital improvement projects "unrelated to
the repair of emergency water main breaks."
It demands Suez prepare a plan of action to prevent future breaks and provide the city all studies, reports, plans or
similar documents detailing the scope of construction on the meter chamber project and any investigations conducted
by Suez as to the cause of the breaks.
It also requires Suez pay attorneys' fees and cost related to the suit.
Additionally, Bhalla said that -- with City Council authorization -- he intends to rebid the city's contract "in hopes of
finding an agreement and framework that works for the residents, not the bottom line of a private company."
Corey W. McDonald may be reached at [e-mail]. Follow him on Twitter @coreymacc. Find The Jersey
Journal on Facebook.

Politics & Government
Hoboken May File Suit Against
Suez After 14 Water Main Breaks
After 14 water main breaks in 64 days, Hoboken has had enough, its mayor says.
By Eric Kiefer, Patch Staff | Aug 28, 2018 2:31 pm ET | Updated Aug 28, 2018 2:51 pm ET

HOBOKEN, NJ — After 14 water main breaks in 64 days, Hoboken has had enough, its mayor says.
On Tuesday – following a weekend that saw Suez Water at the scene of two, large water main breaks –
Mayor Ravinder Bhalla announced that the situation has reached "emergency" proportions. During a
press conference, Bhalla said that municipal officials plan to declare an emergency while investigators
try to answer an urgent question: why is the city seeing so many breaks?
In the meanwhile, municipal officials plan to file a lawsuit against Suez to recoup "damages to the
city," Bhalla said. The mayor added that he wants to work with the City Council to "re-bid the work
being done by Suez."
 See related article: Those Are The Breaks, Hoboken: More Water Mains Burst (PHOTOS)
 See related article: Suez Can Resume Hoboken Work, But There Are Conditions
Hoboken Councilman Michael DeFusco issued the following statement about the water main breaks
and the city's response on Tuesday:
"Hoboken's water infrastructure is at a breaking point, but as urgent as it is
to fix this problem we shouldn't be looking for scapegoats, we should be
finding solutions. This 'emergency' isn't a new phenomenon that suddenly
appeared this week -- it's a problem that's been going on in Hoboken for the
last decade. It's time we start finding holistic solutions through
comprehensive planning, and I do not believe that getting the city tied up in
another costly lawsuit is necessarily the right approach."
DeFusco continued:
"In the past, the City Council has not been privy to negotiations between
prior administrations and the city's private water provider. I am calling on
the Mayor and on Suez Water to change that and to have an open and
transparent dialogue on this issue before rushing into a lawsuit that will
only benefit attorneys and not residents. I truly hope that the Mayor will
work collaboratively with the City Council as well as Suez in an effort to
find a solution to our chronic water infrastructure issues. That solution
should involve substantial investment in the system over the long term,
integrating new technologies to improve service and better managing short
term problems like main breaks."
Rich Henning, senior vice president of communications with Suez Water, provided Patch with the
following statement on Tuesday:
"Hoboken's water infrastructure is over a century old in many places, and
unless Mayor Bhalla stops pointing fingers and starts investing in the
system the problems residents are facing will continue to get worse, not
better. The City of Hoboken owns the system and is ultimately responsible
for making investments necessary for improving it, and SUEZ has
proposed making major investments into it several times in the past only to
have the city continue to neglect its infrastructure needs. SUEZ stands
ready to do what is necessary to solve this problem by investing the
millions of dollars needed to replace these functionally obsolete pipes and
also to improve services for residents by installing new technology to more
quickly identify leaks and restore service faster. We hope that the City of
Hoboken will work with us in this effort instead of pursuing an
unnecessary lawsuit that will only burden the city's taxpayers while doing
nothing to invest in the city's infrastructure."
A Suez spokesperson provided statistics on water main breaks in Hoboken from 2001 to 2018 (see
below). Suez also provided a photo of a pipe removed from a recent break at 5th and Jefferson that
dates back to 1897.

RECENT WATER MAIN BREAKS IN HOBOKEN
On Aug. 25, a main break at Newark and Hudson streets caused service disruptions in the area and
snarled nearby traffic. Mayor Ravinder Bhalla said that the break was located next to "many service
lines and fiber optics" and required repair work from Fletcher Creamer and Verizon.

Suez Water reported that evening that repairs were made to a 16-inch water main in the area. Roads
remained closed to the affected zone and surrounding streets.
#Hoboken 3:20 update Crews are working hard to repair the 16 inch water main located at Newark and
Hudson. Traffic remains closed at Hudson and 1st and Newark between River and Washington. Thank
you for your continued patience. pic.twitter.com/xS1Q6T1jGs
— SUEZ Water NJ (@SUEZwaterNJ) August 25, 2018
#Hoboken 11:30 am update on the water main break located at Newark Street and Hudson Street.
Repairs were completed yesterday evening. Crews are currently working on paving the affected
area. pic.twitter.com/GuyuipuWYj
— SUEZ Water NJ (@SUEZwaterNJ) August 26, 2018
Visited water break again this afternoon. 16" main is in center & many service lines and fiber optics all
around. Fletcher Creamer is making repairs to the water main, Verizon making minor repairs. Working
to have water main fully repaired, asphalt in and blacktop by tonight. pic.twitter.com/KkroFG3euS
— Ravinder S. Bhalla (@RaviBhalla) August 25, 2018
The incident at Newark and Hudson came just four days after Suez repaired a separate water main
break at the intersection of Observer Highway and Jefferson Street. Residents of a nearby apartment
building on Adams Street were still without water a day later.
 See related article: Hoboken Main Breaks, Building Left With No Water
Major water main break at Observer/Jefferson. The repair is in progress. Observer is closed from
Madison to Adams, Jefferson is closed south of 1st. We will provide updates as they
develop. pic.twitter.com/0bUrQ4E1vJ
— City of Hoboken (@CityofHoboken) August 20, 2018
On Sunday, Aug. 26, another water main broke in Hoboken... this time on 13th between Madison and
Jefferson streets.
A water main broke on 13th b/n Madison and Jefferson and is being repaired. Mayor Bhalla has
ordered SUEZ Water to immediately end work on its water meter pit project in SW Hoboken and other
non-emergent operations until the cause of the frequent breaks is fully investigated.
— City of Hoboken (@CityofHoboken) August 26, 2018
Following Sunday's break, Bhalla ordered SUEZ Water to immediately end work on its water meter
pit project in southwest Hoboken and other non-emergent operations "until the cause of the frequent
breaks is fully investigated."

Send news tips and correction requests to [e-mail]. Learn more about posting
announcements or events to your local Patch site here.
Photo: Ravi Bhalla, Mayor of Hoboken

Friday, March 8, 2019 
Shapiro Haber & Urmy Announces The Filing of a Class
Action Suit On Behalf of Residents of the City of
Gardner Alleging Copper Coil Corrosion
BOSTON (PRWEB) JANUARY 18, 2018
Shapiro Haber & Urmy LLP (http://www.shulaw.com) has led a class action lawsuit against the City of
Gardner, Massachusetts, Suez Water Environmental Services, Inc. and AECOM Technical Services, Inc.
The suit alleges that Gardner and the companies the City hired to manage its water supply were negligent
and they sold, supplied, and distributed corrosive water to Gardner residents and businesses. That
corrosive water is alleged to have caused damage to copper heating coils, water heaters, and boilers.
Some residents allegedly had to replace copper heating coils on multiple occasions. The class action is
brought on behalf of all residents and businesses in Gardner whose copper heating coils, water heaters,
and boilers have been damaged by the corrosive water.
The Complaint alleges that Gardner and its water companies have known for years that the water was
corrosive and failed to implement their own plan to protect against corrosion that was recommended by
City consultants. The Complaint further alleges that the City and its water companies knew for years that
they could x the problem by adjusting the water chemistry through the addition of a orthorphosphate
corrosion protector. In August 2017, Gardner announced its plan to add orthophosphates to the water
supply. Nevertheless, Shapiro Haber & Urmy claims that as of the time the case was led, this solution
had still not been implemented.
The case Magliacane v City of Gardner et al., Case Number 1785-cv-02005, was led in Worcester County
Superior Court. For more information please contact:
Michelle Blauner
Shapiro Haber & Urmy LLP
Share Article

Shapiro Haber & Urmy Announces The Filing of a Class Action Suit On Behalf of Residents of the City of
Gardner Alleging Copper Coil Corrosion
HOME NEWS CENTER BLOG
LOGIN
CREATE A FREE ACCOUNT
PRWeb
Phone: [phone]
Email: mblauner(at)shulaw(dot)com
Share article on social media or email:

View article via:
PDF PRINT
News Center

Contact Author
PARALEGAL
Shapiro Haber & Urmy LLP
[phone]
Email >
VISIT WEBSITE
Media
Shapiro Haber & Urmy Press Release
Shapiro Haber & Urmy Press Release
Magliacane v Gardner Complaint
Magliacane v Gardner Complaint
Questions about a news article you've read?
Reach out to the author: contact and available social following information is listed in the top-right of all
news releases.
Questions about your PRWeb account or interested in learning more about our news services?
PRWeb 
Home /Publications /ARGENTINA: Suez Packs Its Bags and Won't Be Back
- INDUSTRIES -- ISSUES -Enter Keyword or Phrase SEARCH
ARGENTINA: Suez Packs Its Bags and Won't Be BackARGENTINA: Suez Packs Its Bags and Won't Be Back
Published by Inter Press Service | By María Amparo Lasso | Monday, March 27, 2006
The French water company Suez, the favorite villain of anti-privatisation activists, has entered the nal stretch of its
withdrawal from Argentina and Bolivia, where it has been packing for quite a while. And it could be a long time
before it returns to Latin America.

The Néstor Kirchner government in Argentina rescinded on Mar. 21 its 30-year contract with Aguas Argentinas, a
subsidiary of Suez, accused of "repeated non-compliance".

The measure escalated tensions in the tortured negotiations between the Argentine authorities and the company,
which have already lasted three years and have clouded diplomatic relations with France.

Without the concession in the Argentine capital, through which Suez distributed water to some 10 million people,
and with a 2005 presidential decree that rescinds its contract in Bolivia, the rm is left with water concessions in
just two countries in the region: Brazil and Mexico.

And although these two countries represent the two strongest economies in Latin America, Suez's concessions
there are smaller in scope, and in some cases it operates as a minority share-holder.

Suez is an energy and gas giant, with prots reaching three billion dollars in 2005, 48 percent more than in 2004,
and is also one of the most powerful water companies in the world, through its Suez Environnement division.

For many years now, the division has been downsizing in Latin America, while staking its bets on water concessions
in less risky markets in Asia and Europe.

Suez says its water concessions in Argentina and Bolivia failed due to nancial and political risks that prevented it
from obtaining prots in a sector with low rates of return on investment (around ve percent).

"In Argentina there was a big macroeconomic shock and the devaluation of the peso that caused the tensions on
the application of some of the contractual clauses; and in Bolivia, because of political reasons, it was very difcult
for the government to increase the (rates)," Jacques Labre, director of institutional relations for Suez, and
participant in the 4th World Water Forum, Mar. 16-22 in Mexico City, said in a Tierramérica interview.

Suez repeatedly insisted in raising water rates, which had been frozen in Argentina in 2002, as they were in Bolivia.
But both countries rejected the rate hikes as exorbitant -- the company was seeking as much as 400 percent
increases -- and accused Suez of failing to provide quality services, while thousands of angry residents, most of
them poor, took to the streets to demand the company's exit.

The media coverage of the wave of indigenous-led protests against Suez from the impoverished Bolivian city of El
Alto, which played a role in the 2005 resignation of President Carlos Mesa, was especially relentless.

Amidst the loud hostility towards multinational water companies, private investment in this sector has been in the
decline in Latin America over the past decade. Facebook rejects Australian regulator's push for scruti

According to Labre, this trend is due to the huge investments needed in infrastructure in Latin America, which
cause a big impact on rates increase, while public subsidies are not guaranteed, especially in countries where there
are big tensions on the budget.

But the Bolivian authorities accuse Suez of pursuing only prots and leaving some 350,000 families without access
to water. In Argentina, meanwhile, its services were described as "terrible", and there are reports that around
300,000 people are at risk due to water contaminated with nitrates.

Alexander Brailowsky, director of sustainable development for Aguas Argentinas since 1999, defended the
company's achievements and lamented the lack of a government-led water management policy in Latin America,
without which "the private sector, as efcient as it may be, cannot achieve its goals."

"Our rates were the lowest in the whole country, in 10 years some two million people obtained water services for the
rst time, and we showed that the poor do indeed want to pay," Brailowsky told Tierramérica.

"We have learnt from the past and we are going to go to other projects (in the region) when we have a minimum
guarantee that our participation is going to be of benet to all," he said. "Our company had always made an effort
to ensure a non-conictive withdrawal from Argentina."

But all indications are that the legal battle will drag on. Over three years of give and take, the Argentine
government said it was willing to help with an orderly departure by Suez, as occurred with Electricité de France in
2005. However, President Kirchner's decision to withdraw the concession gave an unexpected turn to the talks, and
Suez immediately responded that it would put up a ght.

The rm will continue with the lawsuit it led in the World Bank's arbitration tribunal to recover 1.7 billion dollars it
says it invested in the country since 1993.

That stance has fueled indignation among different groups both inside and outside Argentina. "They are
requesting for very high and unjustied compensation when they brought more problems than benets, they
failed to improve access to services, nor did they combat pollution," Danielle Miterrand, former rst lady of France
turned global activist, told Tierramérica.

Things could evolve along a different course in Bolivia. Abel Mamani, who led protests against Suez in El Alto and is
now Bolivia's minister of water, assured Tierramérica that the government will guarantee an "orderly" exit of the
company.

At the end of this month, the audit results of Aguas del Illimani, the Suez subsidiary, will be available, and a
timeline for departure will be decided. Suez, meanwhile, maintains a conciliatory tone and even says it is open to
exploring a new type of contract in Bolivia.

But President Evo Morales is looking towards another partner: the World Bank, an institution he described in the
past as "terrorist". Minister Mamani met with Jamal Saghir, the Bank's director for energy and water, during the
World Water Forum in Mexico, to explore agreements.

"In Bolivia, we would like to go to the public sector. I welcome them. But my rst question is: Who can deliver
efcient services to the poor at the lower cost? If you can demonstrate to me that the public sector can do it, I will
nance it," Saghir told Tierramérica.

The World Bank believed in the 1990s that partnerships with the private sector were the best way to provide clean
water to the poor, and invested in many companies, including Aguas del Illimani in Bolivia.

After the unf ruitful search for private partners for a new concession in Argentina, Kirchner announced the creation
of a state-owned company, Aguas y Saneamiento Argentinos, to replace Suez.

Public scrutiny of Kirchner and Morales's experiments in the water and sanitation sector will be intense. The
challenge is not a small one: they will have to deliver water at low cost to the poor -- a task they say the French
multinational failed.

Marà a Amparo Lasso is the editorial director of Tierramérica. originally published Mar. 25 by Latin American
newspapers that are part of the Tierramérica network. Tierramérica is a specialised news service produced by
IPS with the backing of the United Nations Development Programme and the United Nations Environment
Programme.
AMP Section Name:Natural Resources
Facebook rejects Australian regulator's push for scruti
Water for Profit
Contamination, riots, rate increases, scandals. From Atlanta to Manila, cities are confronting the true cost of water privatization.
JON R. LUOM A NOVEMBER/DECEMBER 2002 ISSUE
Photo Illustration: Paul Moore
Even before the water turned brown, Gordon Certain had plenty to worry about. With his north Atlanta neighborhood in
the middle of a growth boom, the president of the North Buckhead Civic Association had been busy fielding complaints
about traffic, a sewer tunnel being built near a nature preserve, and developers razing tidy postwar ranch homes to make
room for mansions. But nothing compared to the volume of calls and emails that flooded Certain’s home office in May,
when Georgia’s environmental protection agency issued an alert to North Buckhead residents: Their tap water, the
agency warned, wasn’t safe to drink unless they boiled it first. Some neighbors, Certain recalls, had just fed formula to
their baby when they heard the alert.
“I had parents calling me in tears,” he says. “The things that have happened to the water here have sure scared the hell out
of a lot of people.” A month later, another “boil water” alert came; this time, when Certain turned on his own tap, the
liquid that gushed out was the color of rust, with bits of debris floating in it.
Atlanta’s water service had never been without its critics; there had always been complaints about slow repairs and
erroneous water bills. But the problems intensified three years ago, says Certain, after one of the world’s largest private
water companies took over the municipal system and promised to turn it into an “international showcase” for public-
private partnerships. Instead of ushering in a new era of trouble-free drinking water, Atlanta’s experiment with
privatization has brought a host of new problems. This year there have been five boil-water alerts, indicating unsafe
contaminants might be present. Fire hydrants have been useless for months. Leaking water mains have gone unrepaired
for weeks. Despite all of this, the city’s contractor — United Water, a subsidiary of French-based multinational Suez —
has lobbied the City Council to add millions more to its $21-million-a-year contract.
Atlanta’s experience has become Exhibit A in a heated controversy over the push by a rapidly growing global water
industry to take over public water systems. At the heart of the debate are two questions: Should water, a basic necessity
for human survival, be controlled by for-profit interests? And can multinational companies actually deliver on what they
promise — better service and safe, affordable water?
Already, the two largest players in the industry, French-based conglomerates Suez and Vivendi Universal, manage water
for 230 million people, mostly in Europe and the developing world. Now they are seeking access to a vast and relatively
untapped market: the United States, where 85 percent of people still get their water from public utilities. Private water
providers have positioned themselves as the solution to the developing world’s water problems, notes Hugh Jackson, a
policy analyst at the advocacy group Public Citizen. “But it’s a lot harder for them to make the case when here, in the
world’s center of capitalism, cities are delivering tremendous amounts of high-quality, clean, inexpensive water to
people.”
Yet over the past decade, hundreds of U.S. cities and counties, including Indianapolis and Milwaukee, have hired private
companies to manage their waterworks. Currently New Orleans; Stockton, California; and Laredo, Texas, are in the
process of going private, although opposition has sprung up in all three cities. Water companies have been conducting
annual “fly ins” to Washington, D.C., to press their legislative agenda, lobbying for laws that would protect companies
from lawsuits over contaminated water and block municipalities from taking back troubled privatized systems. Most
recently, a bipartisan group in Congress has been pushing a federal waterworks funding bill, advocated by the National
Association of Water Companies, which would require cities to “consider” privatization before they can tap federal funds
for upgrading or expanding public utilities and would also subsidize such privatization deals.
At the municipal level the lobbying pressure is equally intense, with water companies actively courting local officials (the
U.S. Conference of Mayors’ Website features a large ad from Vivendi subsidiary U.S. Filter) and spending hundreds of
thousands of dollars supporting privatization in local referendums. “It’s hard for local guys to turn these companies
away,” Massachusetts’ former water commissioner Douglas MacDonald has said. “They’re everywhere, with arms like an
octopus.”
The argument behind privatization is that only corporate efficiency can rescue the nation’s aging waterworks. But if
success is measured in terms of delivering an essential commodity to everyone who needs it, then the industry’s record is
less than encouraging. Around the world, cities with private water-management companies have been plagued by lapses
in service, soaring costs, and corruption. In Manila — where the water system is controlled by Suez, San Francisco-based
Bechtel, and the prominent Ayala family — water is only reliably available for two hours a day and rates have increased so
dramatically that the poorest families must choose each month between either paying for water or two days’ worth of
food. In the Bolivian city of Cochabamba, rate increases that followed privatization sparked rioting in 2000 that left six
people dead. And in Atlanta, city officials are considering canceling United Water’s contract as early as this winter.
“Atlanta was going to be the industry’s shining example of how great privatization is,” says Public Citizen’s Jackson. “And
now it’s turned into our shining example about how it maybe isn’t so great an idea after all.”
On a cloudy August day that brought a welcome bit of drizzle to drought-parched Atlanta, Mayor Shirley Franklin lugged
a seven-pound bound volume off a shelf and heaved it onto a table in her office. The report, prepared by a committee she
appointed shortly after taking office last January, contained the city’s case against United Water. It detailed violations of
federal drinking-water standards, including one instance in which levels of chlorine rose to six times the level the
company agreed to in its contract.
The report also listed a string of maintenance problems ranging from broken security cameras and gates to open
manholes and water-main leaks that went unrepaired for weeks. Some residents had to wait months for basic repairs,
even though the company’s contract specifies that some repairs must be made within 15 days. In fact, United failed to
complete more than half of all required repairs in 2001, and it allowed rust and debris to build up, so that when the boil-
water alerts forced the company to flush the system, brown water flowed from the taps.
Finally, the report noted, instead of improving collections of unpaid water bills as promised, United actually allowed
collection rates to drop from 98 to 94 percent, costing the city millions of dollars.
United has succeeded at one thing, according to the city: cutting its own oper-ating costs, chiefly by reducing the water-
works staff by 25 percent even as demand for water in burgeoning Atlanta keeps rising. Staff reductions were partly
responsible for the company’s service troubles, the report indicated, as were higher-than-expected repair expenses: Last
year United demanded that the city provide an additional $80 million for unanticipated maintenance costs. The increase
was blocked when a lone City Council member refused to sign the revised contract.
In mid-August, Mayor Franklin announced that “United Water has not lived up to its responsibility” and formally notified
the company that it had 90 days to fix the problems or the city would terminate its contract. “They keep telling me they
are part of a world-class corporation that can bring us world-class service,” she says, offering a small smile. “So I’m giving
them a chance to prove it.” United has offered to spend $1 million on outside inspectors to reassure city officials that it
isn’t, as Franklin puts it, “cutting any corners.”
It wasn’t supposed to turn out this way. In 1998, when Atlanta’s City Council voted to contract out its water filtration and
delivery system, city officials insisted that corporate management would stave off a budget crisis and drastic rate
increases, and would lower costs by more than 40 percent while improving service. (Franklin herself, then a management
consultant, lobbied for one of the companies bidding on the contract.) It was the largest water-privatization program ever
attempted in the United States and was expected to prompt a wave of similar contracts around the country.
Water privatization has been gaining steam since the early 1990s, when market advocates began touting it as the next
logical step after deregulating electricity. Many city waterworks that were built or expanded in the 1970s are now
decaying, and the cost of needed repairs is staggering. The U.S. Environmental Protection Agency estimates that U.S.
cities will have to spend nearly $151 billion to upgrade or replace pipes, filters, storage tanks, and other infrastructure over
the next two decades. Cities will have to spend an additional $460 billion on sewage systems — another area where the
corporate water giants are making inroads.
The prospect of skyrocketing infrastructure costs prompted U.S. officials to look overseas, where privatization is already a
booming business. Multinational companies now run water systems for 7 percent of the world’s population, and analysts
say that figure could more than double, to 17 percent, by 2015. Private water management is estimated to be a $200 billion
business, and the World Bank — which has encouraged governments to sell off their utilities to reduce public debt —
projects it could reach $1 trillion by 2021. Fortune has called water “one of the world’s great business opportunities,”
noting that it “promises to be to the 21st century what oil was to the 20th.”
The biggest contenders for this emerging market are Suez, a corporate descendant of the company that built the Suez
Canal, and the media conglomerate Vivendi Universal, which owns the USA network and Universal Studios. Together,
the two companies now control about 70 percent of the world’s private water-delivery systems and take in a combined
$60 billion in revenues. Both have spent billions in recent years expanding in the United States: In 1999, Suez bought
United Water for $1 billion, and Vivendi acquired the then-largest American company, U.S. Filter, for more than $6
billion. RWE/Thames Water, a German/British conglomerate, is currently completing its merger with the biggest
remaining domestic company, American Water Works.
The water companies have been expanding even more dramatically in the developing world, where antiquated, often
colonial-era, water systems are no match for rapidly increasing populations. More than 1 billion people lack access to
clean drinking water, notes Peter Gleick, president of the Pacific Institute for Studies in Development, Environment and
Security; a recent report he co-authored points out that “half the world’s people fail to receive the level of water services
available in many of the cities of ancient Greece and Rome.”
Yet corporate water’s record in fixing those problems — or even maintaining the industrialized world’s systems — has
been mixed at best. In 1989 Prime Minister Margaret Thatcher pushed through a program to privatize the United
Kingdom’s water supply; costs to consumers soared over the following decade, despite billions in government subsidies to
the water companies. In some cities, water bills rose by as much as 141 percent in the ’90s, while thousands of public-
sector jobs were lost. Even the conservative Daily Mail declared that “Britain’s top ten water companies have been able to
use their position as monopoly suppliers to pull off the greatest act of licensed robbery in our history.”
Last year the Ghanaian government agreed to privatize local water systems as a condition for an International Monetary
Fund loan. To attract investors, the government doubled water rates, setting off protests in a country where the average
annual income is less than $400 a year and the water bill — for those fortunate enough to have running water — can run
upwards of $110.
In Bolivia’s third-largest city, Cochabamba, water rates shot up 35 percent after a consortium led by Bechtel took over the
city’s water system in 1999; some residents found themselves paying 20 percent of their income for water. Street protests
led to riots in which six people were killed; eventually, the Bolivian government voided Bechtel’s contract and told
company officials it could not guarantee their safety if they stayed
in town.
Privatization has also spawned protests and, in some cases, dominated elections in several other countries, including
Paraguay — where police last summer turned water
cannons on anti-privatization protesters — Panama, Brazil, Peru, Colombia, India, Pakistan, Hungary, and South Africa
(see “South Africa’s Driest Season,” page 38). Here in the United States, some municipalities that initially jumped on the
privatization bandwagon are now having second thoughts. In Milwaukee, which turned its sewage system over to United
Water in 1998, an audit released in July found that a sewer tunnel was dumping raw sewage into local waterways,
including Lake Michigan. Vivendi managed Puerto Rico’s water and waste-water treatment for seven years, but after a
territorial commission cited inaccurate billing and poor maintenance this year, its contract wasn’t renewed.
Companies scrambling for lucrative municipal water contracts have also been caught up in corruption scandals. In June,
Katherine Maraldo, a New Orleans Sewer and Water Board member, and Michael Stump, the former president of
Professional Services Group, which ran the city’s wastewater system, were convicted on bribery charges. PSG is now part
of Vivendi, which is bidding to take over New Orleans’ drinking-water system. And in 2001, two associates of Bridgeport,
Connecticut, Mayor Joseph Ganim pled guilty to racketeering, mail fraud, and falsifying tax returns in connection with a
$806,000 payment from PSG, which was negotiating for the city’s $183 million water contract.
Such incidents point to a fundamental problem with allowing private companies to take over public water systems, says
the Pacific Institute’s Gleick. In attempting to make attractive bids for long-term contracts, companies often
underestimate the cost of maintaining a water system, and so are forced to either skimp on staffing or demand more
money to keep turning a profit. “At least when you have public utilities, the money they take in stays in the community,”
Gleick says. “With the private companies, the profits are going to go out of your community, out of your state, and
probably out of your country.”
Nevertheless, Troy Henry, the southern regional manager of United Water, is convinced that private water providers can
do a better job than public utilities. He readily admits that his company and Atlanta city managers have had problems
“dealing with the complexities of the system” in Atlanta and says the company is spending “multiple millions of dollars
[to] win back the citizens’ and mayor’s confidence.” A biomedical and electrical engineer and former manager at IBM,
Henry argues that private companies can do for water delivery what Big Blue did for computing — revolutionize
technology and attract “the best and the brightest and most talented people.”
Perhaps Henry can mend fences in Atlanta, which he insists is United Water’s — and corporate parent Suez’s — “No. 1
priority.” But Clair Muller, chair of the City Council’s utility committee, contends that even if United Water ends up
saving its Atlanta contract, it will merely have proved that privatization can work only under tight city supervision. And if
tight supervision is possible, why privatize? “If government is run correctly — and that’s always a big if — there’s no profit
motive,” she says. “So if this is about saving money, we should always be able to do it cheaper.”
In the end, the debate is about more than money. Taking responsibility for a community’s water, Muller argues, is simply
not the same as running a sports stadium or a cable franchise. “Water is the worst thing to privatize,” she says. “It’s what
we need to live. I think that’s key to the whole debate — are we going to lose control over functions that are essential to
life?”
JON R. LUOM A
Independent. In print. In your mailbox.
Inexpensive, too! Subscribe today and get a full year of Mother Jones for just $12.
Subscribe
April 2019
Smart. Fearless. Audio.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 11: Please describe, in detail, the factual basis for CAIA's statement in its Petition
to Intervene that "the outcome of the proceedings regarding the Joint Application could also impact . . .
water quality." Please provide any and all relevant analyses, studies, or other documents concerning
any impact to water quality that you attribute to the proposed Eagle Water Company asset acquisition by
SUEZ.
Response: Water quality concerns raised by CAIA are, at least, two-fold. First, the groundwater
supply utilized by EWC provides a higher quality of water than is typically delivered by Suez in the Treasure
Valley. This is a direct result of the blend of source waters utilized by Suez, as well as the fact that because
Suez sources water that is lower quality it must more aggressively treat that water. EWC customers are almost
certain see a reduction in their water quality at the same time that they see a price increase potentially in excess
of 300%. The water quality concerns will also increase health concerns. The negative health impacts of
excessive chlorination of water supplies have been well documented.
Relevant articles and analyses are attached hereto.

Tapped Out?: Are Chlorine's Beneficial Effects in Drinking Water Offset
by Its Links to Cancer?
Although chlorine is widely used as an effective way to disinfect drinking water, researchers are concerned that it can
lead to bladder, rectal and breast cancers

Dear EarthTalk: I am very concerned about the amount of chlorine in my tap water. I
called my water company and they said it is safe just let the tap run for awhile to rid the
smell of the chlorine. But that just gets rid of the smell, perhaps, not the chlorine?
—Anita Frigo, Milford, Conn.
Thousands of American municipalities add chlorine to their drinking water to get rid of
microbes [CORRECTED ACCORDING TO EARTHTALK E-MAIL]. But this inexpensive and
highly effective disinfectant has a dark side. “Chlorine, added as an inexpensive and effective drinking
water disinfectant, is also a known poison to the body,” says Vanessa Lausch of filter manufacturer
Aquasana. “It is certainly no coincidence that chlorine gas was used with deadly effectiveness as a
weapon in the First World War.” The gas would severely burn the lungs and other body tissues when
inhaled, and is no less powerful when ingested by mouth.

Lausch adds that researchers have now linked chlorine in drinking water to higher incidences of
bladder, rectal and breast cancers. Reportedly chlorine, once in water, interacts with organic
compounds to create trihalomethanes (THMs)—which when ingested encourage the growth of free
radicals that can destroy or damage vital cells in the body. “Because so much of the water we drink
ends up in the bladder and/or rectum, ingestions of THMs in drinking water are particularly
damaging to these organs,” says Lausch.

The link between chlorine and bladder and rectal cancers has long been known, but only recently have
researchers found a link between common chlorine disinfectant and breast cancer, which affects one
out of every eight American women. A recent study conducted in Hartford, Connecticut found that
women with breast cancer have 50-60 percent higher levels of organochlorines (chlorine by-products)
in their breast tissue than cancer-free women.

But don't think that buying bottled water is any solution. Much of the bottled water for sale in the U.S.
comes from public municipal water sources that are often treated with, you guessed it, chlorine. A few
cities have switched over to other means of disinfecting their water supplies. Las Vegas, for example,
has followed the lead of many European and Canadian cities in switching over to harmless ozone
instead of chlorine to disinfect its municipal water supply.

As for getting rid of the chlorine that your city or town adds to its drinking water on your own,
theories abound. Some swear by the method of letting their water sit for 24 hours so that the chlorine
in the glass or pitcher will off-gas. Letting the tap run for awhile is not likely to remove any sizable
portion of chlorine, unless one were to then let the water sit overnight before consuming it. Another
option is a product called WaterYouWant, which looks like sugar but actually is composed of tasteless
antioxidants and plant extracts. The manufacturer claims that a quick shake of the stuff removes 100
percent of the chlorine (and its odor) from a glass a tap water. A year’s supply of WaterYouWant
retails for under $30.

Of course, an easier way to get rid of chlorine from your tap water is by installing a carbon-based
filter, which absorbs chlorine and other contaminants before they get into your glass or body. Tap-
based filters from the likes of Paragon, Aquasana, Kenmore, Seagull and others remove most if not all
of the chlorine in tap water, and are relatively inexpensive to boot.

CONTACTS: Aquasana, www.aquasana.com; WaterYouWant, www.wateryouwant.com.

EarthTalk is produced by E/The Environmental Magazine. SEND YOUR ENVIRONMENTAL
QUESTIONS TO: EarthTalk, P.O. Box 5098, Westport, CT 06881; [e-mail].

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 12: Please describe, in detail, the factual basis for CAIA's statement in its Petition to
Intervene that "the outcome of the proceedings regarding the Joint Application could also impact . . .
chemical treatments." Please provide any and all relevant analyses, studies, or other documents
supporting your answer.
Response: Suez Water advertises that it will ‘Provide critical system disinfection for public
safety’ as a benefit to EWC customers if it is successful in acquiring the company. Suez admits that
this means chlorination of the system. There is no documented need for such system disinfection in
the EWC system, and such disinfection would only be necessary if highly chlorinated water from
multiple sources is added to the system after the potential merger with Suez’s existing Treasure Valley
systems.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 13: Please describe, in detail, the factual basis for CAIA's statement in its Petition to
Intervene that "the outcome of the proceedings regarding the Joint Application could also impact . . .
environmental concerns." Please provide any and all relevant analyses, studies, or other documents
concerning any impact to environmental that you attribute to the proposed Eagle Water Company asset
acquisition by SUEZ.
Response: See Response to Request No. 9, which is incorporated herein. The financial
hardship that Suez’s proposed rate hikes would impose on customers could make it cost prohibitive
to adequately water landscaping in residential and commercial common areas, municipal parks and
recreational venues. This would not only negatively impact the aesthetic value of these areas but
would also pose an increased fire risk and disruption to plant and animal life.
Furthermore, Suez’s standard practice of mixing groundwater with surface water across the
Treasure Valley has been well documented and necessitates chemical treatments to their water
systems. CAIA provides the following documentation of environmental cross-contamination that
occurred in Eagle in 2018 from a Suez Water system (KIVI news story). CAIA also provides
documentation of the environmental and health hazards of chlorine on human and animal
populations.
By expanding the existing Suez water system, errors or flaws in that system would then have
the potential to affect the thousands of households that would be added into the Suez system. This
would constitute a new set of environmental risks for those customers that they do not presently
face. By imposing these risks on consumers, Suez would essentially transfer the financial impact of

those risks to others, resulting in ratepayers seeing both increased costs, and increased risk, while
receiving more heavily treated and arguably lower quality water.
In developing this position, CAIA has relied on the same information provided in
response to Request No. 9.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 14: Please describe, in detail, the factual basis for CAIA's statement in its
Petition to Intervene that Eagle Water Company has "many" customers who "are single parents, elderly,
or living with disabilities on fixed and limited incomes." As part of your answer, please provide an
approximate estimate of the number of such customers. Please also provide any and all relevant
analyses, studies, or other documents that form the basis of your estimate.
Response: The reported 2019 population of Eagle is 26,089. The portion of Eagle that is
served by the EWC is home to many seniors living on fixed incomes. Two low income apartment
complexes are located within Eagle Water Company’s boundaries. Several assisted living facilities
are located in this area as well. Eagle Academy, a public school in the West Ada School District, is
located within the EWC’s service area and 45% (803) of the students served at this school are
eligible for free lunch. According to the 2017 US census the overall poverty rate for Eagle is 6.8%
(1,774). The overall divorce rate for Eagle is 6.8% (1,774). There are 1,549 veterans of 5 foreign
wars living in Eagle and the overall poverty rate for those defenders of our freedom is 4.00% (62).
Of those, 21.69% (14) are living with disabilities. Since the EWC area contains many of the older,
more modestly priced homes in Eagle we assume many of these residents live there on fixed or
limited incomes and are served by EWC.
If Suez acquires EWC their proposed rate hikes of 204% on residential customers and 303%
on commercial customers would be an extreme hardship on these groups
References: https://www.publicschoolreview.com/eagle-academy-profile/83616
https://www.publichousing.com/city/id-eagle
https://www.seniorhomes.com/idaho/eagle/
http://worldpopulationreview.com/us-cities/eagle-id-population/

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 15: Please identify any existing programs or other arrangement by which the City
of Eagle can or does provide assistance on water bills to single parents, the elderly, those living
with disabilities, or low-income customers.
Response: CAIA is not aware of, and did not base its decision to intervene on what utility
assistance programs City of Eagle may or may not have. Suez’s application and discovery
responses detail that it expects to raise rates for Eagle Water customers by as much as 300%
without regard to the ability of customers to pay. CAIA asserts it would be inappropriate, and not
in the financial or social interests of rate payers for Suez to shift the impacts of its business proposal
from itself to the City of Eagle and its taxpayers.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 16. Please state whether CAIA is aware of SUEZ's low-income assistance
programs.
Response: CAIA is not aware of, and did not base its decision to intervene on what utility
assistance programs Suez may or may not have. Suez’s application and discovery responses detail that it
expects to raise rates for Eagle Water customers by as much as 300% without regard to the ability of
customers to pay.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 17: Please provide copies of all informational materials, pamphlets, statements,
or other communications that CAIA has provided to its members or to the public regarding the subject
matter of this proceeding.
Response: Responsive document is attached hereto.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 18: Does CAIA contend that the phased-in rate increases proposed by SUEZ
in the Joint Application are higher than any rate increases that would be necessary if the City of
Eagle acquired Eagle Water Company? If so, please describe, in detail, the factual basis for this
position and provide any and all relevant analyses, studies, or other documents supporting this
position.
Response: CAIA objects that the request is not formulated to lead to the discovery of
relevant evidence. Furthermore, the issue addressed by the Request is not presently before the
PUC, as the City of Eagle has not filed any petition or application with the PUC seeking
approval of a sale of EWC’s assets to the City. Subject to and without waiving the objection,
CAIA states that it is, of course, unable to predict with certainty what rate increases the City of
Eagle may or may not impose if they acquire EWC, but believe that it will be considerably less
than rate increases proposed by Suez. This belief is based on facts known at the time of this
answer, but would be further informed by additional discovery if such were to take place. Since
the City of Eagle proposes to run the system as a non-profit, it is necessarily true that profit, or
returns to shareholders in other forms, would not be included in the price charged rate payers.
Furthermore, one of the intended goals of improving local accountability to rate payers is to
ensure that rate payers’ interests are not sacrificed to the needs and wishes of investors from
outside the area. In addition, rates paid represent only one aspect of the financial concerns of
water users and rate payers. The total package comprised of rates, water quality, risk of
environmental and other damages, customer service, and long-term sustainability are equally
relevant to determine the value of what Suez proposes to offer to rate payers. The current

formation of EWC enhances these values by improving local control, local accountability, and
maintaining high water quality standards, all values that are near-certain to be reduced or
eliminated if Suez completes its purchase without additional safeguards being imposed.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 19: Does CAIA contend that the City of Eagle would not seek to move water
under Eagle Water Company water rights to other portions of the City's current or future service area if
the City were to acquire Eagle Water Company?
Response: CAIA objects that the request is not formulated to lead to the discovery of
relevant evidence. Furthermore, the issue addressed by the Request is not presently before the
PUC, as the City of Eagle has not filed any petition or application with the PUC seeking
approval of a sale of EWC’s assets to the City. Subject to and without waiving the objection,
CAIA states it is not aware of and did not base its decision to intervene on any stated plans by
the City of Eagle to move EWC water rights to other areas of service, or not. The PUC does not
presently have jurisdiction over any decisions that might be made sometime in the future and
which are not yet the subject of any application or petition.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 20: Does CAIA contend that the Idaho Department of Water Resources does
not have jurisdiction and authority over the place and purpose of the use of the water rights that are
currently owned by Eagle Water Company, even if those water rights are acquired by SUEZ?
Response: CAIA objects that the request is not formulated to lead to the discovery of
relevant evidence. Furthermore, the issue addressed by the Request is not presently before the
PUC, as neither Eagle Water Co. nor any other party has filed any petition or application with
the Department of Water Resources relating to this subject. Subject to and without waiving the
objection, CAIA does not question IDWR’s jurisdiction and authority over the place and
purpose of the use of water rights currently owned by EWC, even if those water rights are
acquired by Suez. However, CAIA does contend that a locally elected body would be more
highly accountable to local interests in making decisions such as how to utilize existing water
rights than is a foreign corporation with the customer service record known to be possessed by
Suez Water and its affiliates. CAIA is also aware that state level government agencies such as
IDWR tend to be less accountable to local interests (and thus potentially more amenable to large
corporate interests) than, for example, a City Council would be.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 21: Does CAIA contend that the City of Eagle would not chlorinate the
water that would be provided to current Eagle Water Customers if the City were to acquire Eagle Water
Company?
Response: CAIA objects that the request is not formulated to lead to the discovery of
relevant evidence. Furthermore, the issue addressed by the Request is not presently before the
PUC, as the City of Eagle has not filed any petition or application with the PUC seeking
approval of a sale of EWC’s assets to the City. Subject to and without waiving the objection,
CAIA states it cannot not know what City of Eagle would do as far as chlorination of this water
system if they acquire it but it has no indication that Eagle would be mixing ground and surface
water as Suez proposes doing, necessitating chlorination. There is, instead, every reason to
believe that if the City of Eagle acquired the assets of EWC it would continue to provide a
product very similar to that currently provided by EWC.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 22: Does CAIA contend that the City of Eagle does not currently chlorinate the
drinking water provided to its current customers?
Response: CAIA objects that the request is not formulated to lead to the discovery of
relevant evidence. Furthermore, the issue addressed by the Request is not presently before the
PUC, as the City of Eagle has not filed any petition or application with the PUC seeking
approval of a sale of EWC’s assets to the City. Subject to and without waiving the objection,
CAIA states it not aware of, and its decision to intervene was not based on the City of Eagle’s
existing chlorination practices in its operation of a separate and limited water system. However,
long-time EW customers have testified in person and through public comments to the IPUC that
the EWC system has such high quality water that some people moved to EWC service area
specifically for the water quality. Some have stated that was a determining factor in their
decision to move away from areas where Suez was their previous provider and the water looked,
smelled and tasted bad due to heavy chlorination.

Citizens Allied for Integrity and Accountability
Case Nos. SUZ-W-18-02 / EAG-W-18-01
RESPONSE TO SUEZ WATER IDAHO INC. FIRST REQUEST FOR PRODUCTION

Request No. 22: Please identify each person or entity that CAIA intends to call as a
witness in any technical hearing in this matter. For each, please state the subject matter of their
testimony and provide any documents they considered or relied upon in forming their testimony.
Response: In answer to the Second Request No. 22, CAIA has not made any
determination as to what witnesses it may call if this matter proceeds to hearing.

CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 8th day of March, 2019, a true and correct copy of the
foregoing document was served on the following in the manner indicated:

Commission
Attorneys for Commission Staff
Attorneys for Petitioner SUEZ Water Idaho Inc.
Petitioner

Molly O’Leary
Attorney for Petitioner Eagle Water Co.
Petitioner
Petitioner
Attorneys for Intervenor City of Eagle
th
Attorney for Intervenor CAPAI

Boise City Attorney’s Office

Attorney for Intervenor EWCG

James M. Piotrowski