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PRIVATIZATION IN THE WATER INDUSTRY
Privatization promises lower costs, better services, more property tax revenues, and easier budgeting.

By  Dom S. D'Ambruoso

An emerging trend is the private operation of water delivery and treatment systems brought about by unprecedented challenges facing municipally owned and operated water delivery and treatment systems. Demand is increasing and infrastructure is falling into obsolescence. Stricter standards for these services are being imposed at all levels of government and municipal funds are shrinking. Communities are being forced to take action. 

Privatization is the act of shifting all or some of the operational or ownership responsibilities for a water or wastewater service from the public to the private sector.

Privatization includes sales of assets; contracts for operation, maintenance, and administrative services; financing arrangements that make use of private capital; and various forms of public-private partnerships for the construction and/or operation of all or part of a water or wastewater system. In either case, privatization promises lower costs, better services, more property tax revenues, and easier budgeting.

Many of the large investor-owned water systems are actively exploring opportunities to purchase or operate nearby municipal systems over the next several years. The competition for contracts among investor-owned systems is becoming increasingly intense. The potential for contract operations seems especially strong.

Success stories abound.