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Booting Corporate Power, Communities Are Taking Back Control of Their Water

New research puts spotlight on 'story that's crying to be told.'

New research from the Transnational Institute highlights the acceralting trend of communities wresting control of their water from corporations.  (Photo: Bart/flickr/cc)

In communities across the world, people are taking back their water.

Cases of remunicipalization—getting what were privatized water and sanitation services back under public control—is the focus of a new book by the Netherlands-based Transnational Institute (TNI), and offers welcome respite from tales of the ever-encroaching reach of corporate power.

The trend of remunicipalization is accelerating, the new research says, and it's "a story crying to be told."

"This report," stated lead editor Satoko Kishimoto of TNI, "shows that water privatization, which has been promoted so heavily in recent years, is increasingly being rejected by cities worldwide after years of failed promises, poor services, and high prices."

Public reclamation of water services has demonstrated clear benefits to communities, the researchers write, thereby "contradict[ing] neoliberal theorists, international financial institutions, and their expectations of superior private sector performance."

In the last fifteen years, the researchers note there have been 235 cases of such public take-back spanning 37 countries. A recent notable example happened just last month in Jakarta, Indonesia, where, the researchers write, a citizen lawsuit brought the privatization of the city's water systems to a end, as the private control "was deemed negligent in fulfilling the human right to water for Jakarta’s residents."

But many of the success stories are closer to home; fifty-eight of the public reclamations since 2000 have taken place in the United States. Food & Water Watch's Mary Grant outlines some of them for the report, writing:

Since 2000, major water companies have lost 169 contractions to remunicipalization. That's a large number compared to existing private water management contracts, considering that four of the largest companies, representing an estimated 70 percent of the US water outsourcing market, had a total of just 760 government clients in 2013.

Cameron, Texas, for example, took back control of its water and wastewater systems in 2013 by cutting its contract with Severn Trent after the company failed to live up to its promises of lower costs and better service, instead allowing instances of "brown, foul-smelling water" and inadequate treatment that required consumers to boil their water.

In Coeburn, Virginia the town council voted not to renew its contract with Veolia Water North America for its public works department, including its water and sewer systems, and in doing so helped the town struggling to balance its budget slash costs by 28 percent.

The Fairfiild-Suisun Sewer District in drought-stricken California reclaimed services that had been privately operated since 1976. In the first year of the change, 2008, that brought a 7 percent reduction in costs, offering consumers significant savings.

Despite the stories of success, threats to public water do loom, the researchers note, as two pending trade deals—the Transatlantic Trade and Investment Partnership (TTIP) and the Trans-Pacific Partnership (TPP)—offer a platform for corporate power to trump communities' rights through the investor-state dispute settlement (ISDS) provision. ISDS, the new publication explains, "gives foreign investors the ability to directly sue countries in private international tribunals for compensation over health, environmental, financial and other domestic policies that allegedly undermine their corporate rights."

This could have a "chilling effect" on citizens' and elected officials' attempts to try to sever their contracts with private companies, even when the communities face illegal water price increases. "It is not difficult to imagine that water multinationals will use this powerful tool against states and municipalities in the event of remunicipalization," the researchers write.

The editors conclude:

Remunicipalization is about building better public services: services that are more transparent, more accountable, more efficient and focused on people’s needs over the long term. If citizens are willing to fight for remunicipalization and against privatization, it is also because they believe that the public sector is better equipped to meet broader social and environmental goals, and in a better position to address fundamental issues such as affordability and equity, as well as climate change adaptation, water conservation and the protection of ecosystems, as opposed to private companies’ focus on financial aspects. Clearly we cannot afford to continue to rely on private water 'solutions.'

The TNI publication was launched just ahead of the World Water Forum taking place in South Korea. The forum has been criticized as being convened by "the leading for-profit water corporations on the planet."

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