NAWC Study Demonstrates Success of Public-Private Partnerships Across the Country

Public Private Partnerships Successful in Ensuring Compliance with Safe

Drinking Water Act, Upgrading Infrastructure, Reducing Costs, Stabilizing

Rates & Improving Customer Service



Jun 11, 1999, 01:00 ET from United Water

    NEW ORLEANS, June 11 /PRNewswire/ -- Today at the Annual Meeting of the
 United States Conference of Mayors, The National Association of Water
 Companies (NAWC) released a study which demonstrates that public-private
 partnerships between municipalities and private water utilities are
 overwhelmingly successful in addressing the problems most commonly faced by
 municipalities.
     The independent study, entitled, "NAWC Privatization Study: A Survey of
 the Use of Public-Private Partnerships in the Drinking Water Utility Sector,"
 was commissioned by the NAWC and authored by The Hudson Institute.  The
 58-page report examined public-private partnerships in the area of water and
 wastewater systems in 29 cities serving over 3 million customers throughout
 the United States.
     "The NAWC has always believed that public-private partnerships offer an
 effective and efficient means to address the large number of issues facing
 municipal water providers," said Peter Cook, Executive Director of the NAWC.
 "The Hudson Institute Survey confirms the value of strategic alliances between
 municipalities and private water companies."
     The study found that the most widespread problems faced by municipalities
 today include: insufficient capital to upgrade municipal water and wastewater
 facilities, increasing operating costs, non-compliance with federal drinking
 water standards, the looming threat of significant rate increases and the need
 to improve customer service.  The study evaluated each of the 29
 public-private partnerships including asset transfers (acquisitions), leases,
 operating and maintenance contracts, and specific service outsourcing
 contracts.  Key findings of the report include:
 
     --  Compliance with Safe Drinking Water Act (SDWA): Prior to entering into
         a public-private partnership, 41% (12) of the facilities surveyed were
         not in full compliance with the SDWA.  One year after entering into a
         public-private partnership, all were in compliance with federal water
         standards.
 
     --  Capital Infusion: At 31% (9) of the facilities, municipal partners
         (private water and waste water companies) contributed $55.3 million in
         capital for new facilities and equipment upgrades.  This capital
         infusion was exclusive of acquisition costs.  For the nine facilities
         in the study that were acquired by a private water/wastewater company,
         municipalities received $537 million.  For the six projects that
         entered into concession agreements, municipalities received
         $35 million in concession fees.
 
     --  Improved Efficiencies, Cost Savings & Rate Stabilization: 17% (5) of
         the facilities experienced a cost savings between 10% - 40%, avoiding
         large water rate increases to the consumers.
 
     --  Improved Customer Service: Investor owned utilities have been able to
         provide a higher level of customer service at a lower cost by
         integrating the customer service functions such as call-in centers,
         billing and collections into parent company systems.
 
     The last 20 years have witnessed substantial growth in public-private
 water partnerships as a result of growing infrastructure investment
 requirements, shrinking local government financial resources, and regulatory
 compliance issues.  The NAWC study serves as a valuable resource in providing
 state and local governments tangible research on the problems facing
 government owned water facilities and effective solutions provided by
 privatizing the system.
     The Hudson Institute is an internationally recognized public policy
 research organization that forecasts trends and develops solutions for
 governments, businesses and the public.  Founded in 1961 by the late Herman
 Kahn, the Indianapolis-based not-for-profit 501 (c) (3) organization has more
 than 70 researchers and employees at its eight offices worldwide.
     The National Association of Water Companies (NAWC) is a nonprofit trade
 association that exclusively represents the private and investor-owned
 drinking water utility industry.  NAWC's primary goal is to strengthen the
 industry through advocacy of public policy, regulatory and legislative issues
 that directly relate to the private and investor-owned water companies.  NAWC
 represents over 320 companies in 42 states serving 21 million Americans and
 has a national office headquartered in Washington, D.C. as well as 12 state
 and regional chapters.
 
 

SOURCE United Water
    NEW ORLEANS, June 11 /PRNewswire/ -- Today at the Annual Meeting of the
 United States Conference of Mayors, The National Association of Water
 Companies (NAWC) released a study which demonstrates that public-private
 partnerships between municipalities and private water utilities are
 overwhelmingly successful in addressing the problems most commonly faced by
 municipalities.
     The independent study, entitled, "NAWC Privatization Study: A Survey of
 the Use of Public-Private Partnerships in the Drinking Water Utility Sector,"
 was commissioned by the NAWC and authored by The Hudson Institute.  The
 58-page report examined public-private partnerships in the area of water and
 wastewater systems in 29 cities serving over 3 million customers throughout
 the United States.
     "The NAWC has always believed that public-private partnerships offer an
 effective and efficient means to address the large number of issues facing
 municipal water providers," said Peter Cook, Executive Director of the NAWC.
 "The Hudson Institute Survey confirms the value of strategic alliances between
 municipalities and private water companies."
     The study found that the most widespread problems faced by municipalities
 today include: insufficient capital to upgrade municipal water and wastewater
 facilities, increasing operating costs, non-compliance with federal drinking
 water standards, the looming threat of significant rate increases and the need
 to improve customer service.  The study evaluated each of the 29
 public-private partnerships including asset transfers (acquisitions), leases,
 operating and maintenance contracts, and specific service outsourcing
 contracts.  Key findings of the report include:
 
     --  Compliance with Safe Drinking Water Act (SDWA): Prior to entering into
         a public-private partnership, 41% (12) of the facilities surveyed were
         not in full compliance with the SDWA.  One year after entering into a
         public-private partnership, all were in compliance with federal water
         standards.
 
     --  Capital Infusion: At 31% (9) of the facilities, municipal partners
         (private water and waste water companies) contributed $55.3 million in
         capital for new facilities and equipment upgrades.  This capital
         infusion was exclusive of acquisition costs.  For the nine facilities
         in the study that were acquired by a private water/wastewater company,
         municipalities received $537 million.  For the six projects that
         entered into concession agreements, municipalities received
         $35 million in concession fees.
 
     --  Improved Efficiencies, Cost Savings & Rate Stabilization: 17% (5) of
         the facilities experienced a cost savings between 10% - 40%, avoiding
         large water rate increases to the consumers.
 
     --  Improved Customer Service: Investor owned utilities have been able to
         provide a higher level of customer service at a lower cost by
         integrating the customer service functions such as call-in centers,
         billing and collections into parent company systems.
 
     The last 20 years have witnessed substantial growth in public-private
 water partnerships as a result of growing infrastructure investment
 requirements, shrinking local government financial resources, and regulatory
 compliance issues.  The NAWC study serves as a valuable resource in providing
 state and local governments tangible research on the problems facing
 government owned water facilities and effective solutions provided by
 privatizing the system.
     The Hudson Institute is an internationally recognized public policy
 research organization that forecasts trends and develops solutions for
 governments, businesses and the public.  Founded in 1961 by the late Herman
 Kahn, the Indianapolis-based not-for-profit 501 (c) (3) organization has more
 than 70 researchers and employees at its eight offices worldwide.
     The National Association of Water Companies (NAWC) is a nonprofit trade
 association that exclusively represents the private and investor-owned
 drinking water utility industry.  NAWC's primary goal is to strengthen the
 industry through advocacy of public policy, regulatory and legislative issues
 that directly relate to the private and investor-owned water companies.  NAWC
 represents over 320 companies in 42 states serving 21 million Americans and
 has a national office headquartered in Washington, D.C. as well as 12 state
 and regional chapters.
 
 SOURCE  United Water