Felton Community Resists Water Giant

The small community of Felton is going toe to toe with the nations largest private water compnay. American Water serves some 18 million customers in 29 states, including California, Pennsylvania, New York, Illinois, and Ohio. 82 year old Milton Nielsen lives on social security with his son in Felton, California. After a water pipe broke on his property he received a water bill for over 4,000 dollars.

"I got that bill and I almost fell over."

After complaining to American Water about his bill, they agreed to cut the bill in half, requiring Nielsen to pay over 2 thousand dollars for water he never used.

"I wouldn't ask them to give me a hand if I was dying of thirst in the desert. That's how crooked these people are."

Nielsen says his last water bill was 162 dollars, more than double what he paid before American Water bought the system in 2002. This steep increase is why the community of Felton has now voted overwhelmingly to buy their water system back.

But the company refuses to sell. Kevin Tilden, spokesperson for Cal Am Water,American Water's California division, says price increases are necessary to maintain the decades old water system.

"Water standards are changing, for water quality, the EPA standards are changing. There's some investment needed to keep up with that. But also our water systems are generally 40 to 100 years old and there's a certain amount of maintenance and replacement needed to keep them reliable and current."

Tilden says the company's prices are comparable to those in nearby water districts and actually lower than some, like the community of Davenport, where residential water bills are over a thousand dollars every year.

The San Lorenzo Valley Water District shares the same water source as Felton. Barbara Springer a member of Felton's FLOW, Friends of Locally Owned Water says SLV's water rates are half what she pays American Water.

"For 40 units for SLV water district you'd be paying about 118 dollars for two months. For Cal Am, we're paying about 275 dollars for the same amount of water."

The people of Felton plan to use eminent domain to buy back their water system BUT American Water has spent millions resisting. Springer says the rate increases are not going to pay for
maintenance, but to pay for American Water's corporate overhead.

"SLV water district is managed right here in the San Lorenzo Valley, that's it. Cal Am has a layer of management in Monterey California, a layer of management in New Jersey, they have another layer in Essen, Germany, so we're paying for all those multiple layers and significant private corporate salaries."

Felton isn't the only community to battle American Water. The city of Chicago waited months for broken fire hydrants to be fixed; and communities in Ohio fought back rate increases for brown tap water from American Water.

Victoria Kaplan of Food and Water Watch, says there's a conflict with private companies owning public resources like water.

"Private water companies are accountable to their share holders not the public they serve."

Last year, American Water's parent company, German based RWE announced it was selling American Water in order to focus on energy. But, Food and Water Watch released RWE board meeting minutes that show American Water has faulty infrastructure that would take over 200 years to replace and its outdated pipe system is leaking nearly 20 to 30% of water in New Jersey and Pennsylvania. Minutes also state that regulations on arsenic and mercury contamination are getting tougher to meet, suggesting that RWE is selling American Water to offload a potential liability. RWE declined to comment for this feature.

Kaplan says the Bush Administration's cuts in public services are accelerating water privatization.

"What this does is it puts communities that need to improve their water system in a position where they're searching for the funding to do so, that enables private corporations like American Water to get their foot in the door and make their argument for doing the job. But, private companies like American Water have not been able to get the job done and get the job done well."

That's why Food and Water Watch is working to introduce legislation to establish a federal water trust, that would finance the nations water system. Meanwhile, the community of Felton and American Water have their first eminent domain court hearing later this month. From Felton, California, I'm Christina Aanestad reporting For FSRN.