Akron Voters Reject Stinky Privatization Measure

Despite the support of the media, members of the investment
community and at least one NBA star, residents of Akron, Ohio rejected
a measure to privatize their city's sewer system on Tuesday. Issue 8
was defeated by 62 percent to 38 percent. Issue 9, a citizen's
initiative to ensure that all utility privatizations in Akron are
subject to public referendum passed by a 2-1 margin.

Introduced by Mayor Donald Plusquellic, Issue 8 would have leased
Akron's sewer system to corporate interests, leaving the maintenance
and operation of the system to a private company in return for almost
$200 million. Plusquellic justified the measure, saying that the money
would go to finance a scholarship program for Akron youth. Issue 8
was opposed by Citizens to Save our Sewers and Waters (Citizens SOS), a
coalition composed of local labor, faith and community groups and the
sponsor of Issue 9.

"Last night the citizens of Akron won a tremendous victory. They
overwhelmingly said 'No' to Issue 8, which would have leased the city's
wastewater utility to a private, for-profit corporation. This would
have meant rate increases, poor service, and bad maintenance. The Mayor
disguised this proposal in the scheme of a scholarship program, but he
did not tell the folks of Akron all the facts. We got the facts about
this proposal to the citizens and they overwhelmingly voted down Issue
8," noted Jack Sombati, of AFSCME Ohio Council 8.

"The
decisive defeat of Issue 8 was a victory for keeping Akron's public
utilities public," said Greg Colleridge, director of the Economic
Justice and Empowerment Program, Northeast Ohio American Friends
Service Committee. "The overwhelming support for Issue 9 was a clear
statement by Akron voters that they want to have a direct voice in the
future of their public water, sewer and other utility systems. Citizens
in Akron now join the growing trend of people nationally and globally
who feel public utilities are valuable community assets that should be
publicly preserved rather than sold or leased to for-profit business
corporations who care principally about their shareholders and owners."

The passage of Issue 9 is part of a larger nation-wide trend of
citizens forcing potential utility privatizations to go up for public
approval. Similar efforts have been introduced and passed in New
Orleans, Louisiana and Stockton, California.

"Issue 8 would have leased Akron's sewer system to a private company
for 99 years, a plan that has never been carried out in the U.S. and
would have amounted to making the residents of Akron guinea pigs of a
risky privatization experiment," said Wenonah Hauter, executive
director of Food & Water Watch. "We congratulate Citizens SOS for
their hard-won victory. Akron voters were correct to reject Issue 8 and
to approve Issue 9, which will protect public assets from other
ill-conceived privatization measures."

Under Issue 8 the city would have retained responsibility for big
projects, including the $370 million federal mandate to eliminate
sewage overflows. The price tag for infrastructure improvements would
have increased because Akron would have had to replace tax-exempt,
low-interest public financing with expensive private financing.

"Privatization is not the cure to repairing ailing infrastructure
systems. The evidence from the 86 percent of U.S. water systems under
public control clearly shows higher efficiency with lower costs for
ratepayers. In contrast, corporations' costs are higher and any
efficiency premiums are often passed on to their shareholders. Indeed,
the 14 percent of U.S. water utilities that are privately owned charge
ratepayers anywhere from 13 percent to 50 percent more than their
public counterparts," noted Hauter.

Food & Water Watch is a Washington, D.C.-based national consumer advocacy organization. Visit www.foodandwaterwatch.org.