Wisconsin Lawmakers May Ease Utility Privatization

Wisconsin may make it easier to privatize municipal water utilities.

Lawmakers are considering a bill “that could ease the process of private companies buying municipal water utilities. The Republican-controlled Assembly has already said yes,” WUWM reported.

“Under current law, if city officials want to sell, the Public Service Commission, or PSC, conducts a review. And then, local residents vote — in the form of a referendum. The original bill would have given interested parties 30 days to place the water privatization question on the ballot. The amended version now winding through the Senate gives 60 days, and lowers the number of signatures required for a referendum, from 25 percent of those who voted in last gubernatorial election to 10 percent,” the report said.

The League of Wisconsin Municipalities opposes the measure.

“One board member cited [a report] on high costs at the state’s only large privately owned water utility, said league assistant director Curt Witynski, but most objections focused on the large investments of public money that have built water delivery systems,” the Wisconsin State Journal reported.

In Wisconsin, most utilities are public, the report explained:

Only one of Wisconsin’s roughly 80 large water utilities is privately owned. Allete Inc. of Duluth, Minnesota, has owned the water system serving Superior since 1923, and its customers pay among the highest rates of the large systems, according to PSC data. The PSC allows Allete to collect from water users total annual revenue that includes a 9 percent rate of return over operating expenses, more than any of the large water systems.

Many water sector experts argue that the public/private debate is not a simple either/or. Here’s how Michael Deane, executive director of the National Association of Water Companies, explained it in letter published on Water Online: “The reality is that there is no ‘showdown’ between public and private water utilities. It’s up to individual communities to explore all options including private water companies that have been providing quality service to American communities for well over 200 years.”

To read more about publicly and privately run water utilities, visit Water Online’s Funding Solutions Center.