The Association of Metropolitan Water Agencies (AMWA) strongly believes that the interests of drinking water consumers are well served by effective, efficient and competitive publicly owned water systems dedicated to providing consumers with safe and affordable drinking water.
AMWA believes that publicly owned water systems benefit the community in ways that privately owned water systems do not, such as through interdepartmental coordination opportunities. Moreover, AMWA believes that publicly owned water systems have achieved a competitive position by integrating into their operations the best practices found in both the public and private sectors.
Sometimes, alternative project delivery approaches –i.e., project procurement processes outside of the traditional design-bid-build approach most often used by municipal agencies –may provide benefits to utilities. There is a wide array of such options that are on a continuum of public-private-partnership (P3) approaches that allow for risk, responsibility, funding and liability of project delivery to be collectively managed and appropriately shared.
AMWA opposes legislation or regulation that indicates a preference, whether implicit or explicit, in favor of the privatization of publicly owned drinking water agencies (ranging from the sale of assets to contract operations). Privatization decisions must be left to the local decision makers most directly affected by the decision and its long-term consequences including disruptions caused by business failures.
- Publicly owned and operated water systems benefit drinking water consumers in the following ways:
The control, responsibility and accountability for the entire water system is clearly defined.
There is an absence of profit motives that could influence key decisions.
Publicly owned and operated water utilities have a commitment to make needed capital investment by virtue of ownership, accountability and a long term perspective.
- Publicly owned and operated water systems have the motivation and the tools to outperform the private sector, including:
A keen awareness of the local community’s needs and values.
A clear mandate to meet those needs and incorporate those values into the mission of water systems.
An experienced, knowledgeable and dedicated staff.
- Publicly owned and operated water systems have demonstrated their ability to compete through:
Improved efficiencies resulting from industry-wide benchmarking and other similar activities.
Willingness to streamline cumbersome operating rules and procedures (e.g., procurement and personnel).
Successful participation in a number of managed competition processes.
Creation of effective partnerships between management and employees (in many cases through formal competitiveness agreements and relationships with labor unions).
Creative use of private sector resources and outsourcing of various services while preserving public control and accountability.
- While many utility-wide operating contracts between large metropolitan water systems and private firms have not been successful, some utilities have found that contracting with firms to operate individual components of their systems may be beneficial.
- Alternative project delivery approaches, including P3s, may provide benefits to utilities, such as shorter capital project implementation timelines, risk transfer and access and incentives for private sector innovations. Publicly owned utilities should consider local needs for project delivery as well as the legal authority in their state for publicly owned utilities to employ a P3 model for capital projects