08 Privatization of Services - Laserfiche WebLink

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~ae~ ~os~ of 000 aftee ~e eo~~ s According to Standard & Poors, many of the companies acquiring water utilities in the United States are based outside the U.S., such Vivendi and Suez of France (formerly known as Suez Lyonnaise des Eaux), Kelda Group of England? These firms have often entered the U.S. market through acquisition of similar U.S. companies. For example, Vivendi, a water services business as well as a multi-media entertainment giant, has acquired US Filter, one of the major private sector providers of water and wastewater services. In 2000, the City of Atlanta completed the first annual review of its 20-year operation and management contract with United Water Services of Atlanta. The review looked at costs, fees and charges and the overall operating practices of the utility. Atlanta was the first major city to undertake such an all-embracing partnership with the private sector for its water-wastewater services. Though Atlanta's performance review of the contract reflected that all the terms of the contract were being met, the audit pointed out that there were problems in the maintenance of the distribution system--keeping up with the backlog and volume of new repair work-- inadequate coordination of the customer information system and reporting and revenue interface problems between UWSA and the City Finance Department.2~ In Africa, South America and Europe, private sector participation in water supply and wastewater services by multinational corporations has been occurring for a longer period than in the United States. The results of some of these efforts have been mixed and might illuminate issues for U.S. municipalities: water tariffs in some countries doubled, companies lost money because they could not collect utility connection fees in poor areas, and investors withdrew from water projects because they could not get a desirable return on their investments. Governments who have entered into "Take- or-