Bill Allows for Privatization of Water

Sophia Bollag

In a bond proposal that attempts to provide solutions to numerous water-related issues in California, there is a clause which would potentially allow private investors to “own, govern, manage and operate a surface storage project,” such as a reservoir. Californians will vote on the bond in November 2010 and if it passes, private investors would be able to profit from the sale of water, which could cause the price of water to increase.

According to The San Francisco Chronicle “lawmakers barely discussed the provision while considering the bond, and water experts… said they knew little about it or why it was a necessary part of the [bond].”

The bond proposal, the Safe, Clean, and Reliable Drinking Water Supply Act of 2010, claims it would “provide funding for California’s aging water infrastructure and for projects and programs to address the ecosystem and water supply issues in California.”

“This bond provides that new surface water reservoirs built under this program may be operated by a Joint Powers Authority, which would be a nongovernmental entity,” said Jennifer Clary from the California branch of Clean Water Watch, a nonprofit organization.

The San Francisco Chronicle reported that supporters of the provision argue that allowing private investors to help fund the creation and upkeep of surface storage projects would make these projects easier to finance.

Those who oppose the privatization of water, however, argue that it is dangerous to allow a private investor, whose primary concern is personal profit, to gain control over a public resource, such as water. According to a statement issued by the Food and Water Watch Executive Director Wenonah Hauter, “Around the U.S. and abroad, private utility companies routinely take over struggling public water systems, only to jack up rates while service suffers.”

Opponents of the bill point out other flaws with its provisions. “This bond contains $1 billion to clean up groundwater,” said Clary. “However, that groundwater cleanup isn’t tied to a reduction in water supplies taken from elsewhere, for instance from the Delta. A key reason for the catastrophic species decline in the Delta is poor water quality due to polluted discharges upstream and the high rate of pumping out of the Delta. This bond does nothing to change the practices that have led to the degradation of the Delta.”
This provision creates controversy over who controls the price and distribution of a public resource and adds to California’s long list of water-related problems.