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The Top Five Reasons to Keep Illinois’ Water in Public Hands
WATER
The research shows five main ways that private control of water is a bad deal for Illinois.
1. High Water Rates.
The typical Illinois house-hold pays 36 percent more for water from a large pri-vate utility than for service from a municipality. That’san extra $86 a year (see figure 1).
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Peoria (water).
In 2008, Illinois American WaterCompany increased the water rates in the Peoria area by 14.9 percent.
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The annual bill of a household using5,000 gallons a month in the Peoria District jumpedto $442.
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Champaign and Urbana (water).
In 2008, Il-linois American Water Company increased the waterrates in its Champaign County district by 47.2 per-cent.
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The annual bill of a household using 5,000 gal-lons a month jumped to $412 in Champaign and $421in Urbana.
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2. Expensive Financing.
Private financing is farmore expensive than public financing (see figure 2).
From 2000 to 2008, even the best-rated corporate bond was 17 percent more expensive than a typical municipal bond issued in the state, and 135 percent more expensivethan loans from Illinois’s State Revolving Fund programs.
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3. Clean Water Act Violations.
Privatelyoperated major sewage treatment plants were in non-compliance of the Clean Water Act 10 percent more oftenthan their publicly operated counterparts were over thelast three years (see figure 3).
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4. High Operating Costs.
Public control is abetter deal for the ratepayer and the taxpayer.
Pekin (sewer).
In 2005, after 12 years of privatecontrol, the Pekin city council unanimously voted totake over its wastewater treatment plant. The city es-timated that over a 10-year period, private operation would have been around 25 percent more expensivethan public operation, and by running the plant withcity employees, Pekin expected to save $2 millionover a decade.
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Homer Glen (water).
After great public outrageover high water bills, Homer Glen began exploringhow to take over its water system from Illinois Ameri-can Water.
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Mayor Jim Daley said that public control would save the village a significant amount of money over time. A study commissioned by the village andneighboring towns found that the Homer Glen couldprovide its residents water at a lower rate, accordingto village manager Pamela Wallrich.
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Woodhaven Lakes (water and sewer).
After Aqua Illinois hiked Woodhaven’s water rates by 48percent in 2001 and 58 percent in 2005, the property owners’ association decided to take over their waterand sewer systems to stabilize rates.
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In October2007 the members overwhelmingly voted — by amargin of 4-to-1 — to purchase the systems.
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The people of Illinois need public control of their drinking water and wastewater service to keep itsafe and affordable.
Although public entities typically manage water utilities, when these systems fall into privatehands, costs grow and consumers end up paying too much for poor-quality water. It can lead to sewage spills and ser- vice problems. Because of these failures, taxpayer money should neither incentivize nor subsidize private ownership,management or operation of water and sewer systems.
Figure 1: Average Annual Bill of Illinois HouseholdsUsing 5,000 Gallons a Month, by Utility Ownership
0100200400300500500
$326.88$240.84
Municipal UtilitiesPrivate Utilities (1,000or more customers)
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