Last year, the water supply in Flint, Michigan was found to contain high amounts of lead. As many as 8,000 children have likely been exposed to the poisonous substance for months. Meanwhile, more evidence emergences that Gov. Mitch Snyder’s office ignored numerous warning signs that the city water had a problem. Further, some have suggested these warnings were ignored because the affected population was primarily poor and African American.
The crisis in Flint dates back to April 2014, when the city’s emergency manager — seeking to save money due to its massive budget crisis — switched its water supply from the Detroit system to the nearby Flint River. Shortly after, several red flags were raised, including General Motors ceasing use of the water in its Flint plant because it was too corrosive. As early as February, lead levels were found to be unacceptably high, and soon residents were complaining about rashes, hair loss, and other health symptoms. By the end of the year, it became clear that the water from Flint’s polluted river was corroding the city’s lead pipes and poisoning its population.
While cost-cutting was at the root of the catastrophe, a typical Flint home paid $864 per year in water bills after the city switched from Detroit’s network. This is nearly triple what the average public water system household pays, and more than in any major system in the United States. Flint is not the only city in the country with contamination problems, nor is it the only system where Americans are paying several times the standard water bill each year.
In an interview with 24/7 Wall St., Mary Grant, Public Water for All campaign director at Food and Water Watch, explained, “Flint was a case of a loss of democratic control of a water system. This emergency manager came in and started treating the water system like a business, instead of a public service.”
While Flint’s water supply is managed by a government entity, private water systems tend to be far more expensive on the whole. For this reason, and also because it is easier to ensure water safety in a government-run system, most municipal water utilities are public. According to Grant, most of the governments that choose to privatize their water or sewer system do so to pay off short-term liabilities.
Although just 12% of the nation’s population is served by a private company, seven of the 10 most expensive water systems are owned by private companies. The typical household water bill in a privately-owned municipal system is $316.20, while private systems cost more than $500 on average.
Grant explained that private companies are more expensive because of “how they’re regulated, the costs they’re allowed to recover, and the rate of return they’re allowed to make on their investments.” She added that one factor in particular that is driving up costs also tends to make private systems less safe. “Small private systems rely on groundwater that may be contaminated, and so a large public system can come in and take over the system and connect it to its existing water treatment plant to provide more cost-effective service, and also higher quality service.”
Regional governments can set caps on how much private companies charge users, but state laws allow some private companies more leeway on what they are allowed to charge for, and how much. Pennsylvania, where five of the 10 most expensive water systems are located, has particularly friendly regulatory systems for private companies. In particular, Pennsylvania allows entities to obtain significantly higher rates of return.
Regional water scarcity can also drive up prices. In California, which is in the midst of one of the worst droughts on record, several cities have raised prices in an attempt to curb water usage, and also to maintain profits during this period of conservation. Goleta, California, where water costs a typical family $737 per year, uses this tactic. The city was sued due to the price increase.
Consumer rights group Food & Water Watch reviewed the U.S. Environmental Protection Agency’s Safe Drinking Water Federal Information System, and identified the 500 largest community water networks. Using utility websites, government ordinances, and calls to utility customer service lines, the group calculated the amount a household using 60,000 gallons of water — a typical usage rate — would pay annually in each system. The 10 municipalities on this list are the largest cities in the service areas these systems cover. 24/7 Wall St. also reviewed income and poverty data from the U.S. Census Bureau for the principal counties and cities in these areas.