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Privatizing Water can be disasaterous

EXCLUSIVE: The cost of privatization
– Pontiac has water contamination issues under United Water

by Eclectablog on JANUARY 26, 2012 in EMERGENCY MANAGERS, PONTIAC

This past year, the Emergency Manager of Pontiac at the time,
Michael Stampfler signed a five-year contract with United Water
to run their water and wastewater treatment systems.
The move was said to save Pontiac
an astonishing $2.8 million per year.

I broke a story that made national news about the fact that,
by hiring United Water, Stampfler had hired a company facing
a multiple felony counts by the U.S. Justice Department
for violations of the federal Clean Water Act.

United Water Services Inc., the former contract operator of
the Gary Sanitary District wastewater treatment works in
Gary, Ind., and two of its employees, were charged today
with conspiracy and felony violations of the Clean Water Act
in a 26-count indictment returned by a federal grand jury,
the Justice Department announced today.
United Water Services Inc., and employees Dwain L. Bowie,
and Gregory A. Ciaccio, have been charged with manipulating
daily wastewater sampling methods by turning up disinfectant
treatment levels shortly before sampling,
then turning them down shortly after sampling.


According to the indictment, the defendants conspired to tamper
with E. coli monitoring methods by turning up levels of
disinfectant dosing prior to E. coli sampling.
The indictment states that the defendants would avoid
taking E. coli samples until disinfectants had reached
elevated levels, which in turn were expected to lead
to reduced E. coli levels.
Immediately after sampling, the indictment alleges,
the defendants turned down disinfectant levels,
thus reducing the amount of treatment chemicals they used.


The case was investigated by the Northern District of
Indiana Environmental Crimes Task Force, including agents
from the Criminal Investigation Division of the U.S.
Environmental Protection Agency, the FBI and the
Indiana State Police.
The case is being prosecuted by the U.S. Attorney’s Office
for the Northern District of Indiana and the
Justice Department’s Environmental Crimes Section.

In November 2011, current Emergency Manager Lou Schimmel
fired some key Public Works employees and United Water
took over operations completely.

Well, it turns out that there is trouble in paradise.
In their effort to cut costs to the bone at the expense
of public employees, residents last week have been
reporting issues with the quality of their water.
Daily Kos commenter “ChemBob” dropped this comment
on one of my posts at the site:

United Water has taken over operation of our water and
wastewater treatment here in Pontiac. Happened in July.
We have an emergency manager, naturally.
Never had a problem here before (been in house about 1.3 years now),
but during the past week or slightly more, we and the neighbors
have had rusty brown tap water three separate days.
We’ve all called United, multiple times.
We saw a truck at the fire hydrant once, but the rusty water
was back two days later. We ask for a call back to let us
know what they are doing, but they never return our calls.

This is the beauty of privatization:
they really aren’t responsible to the people,
their customers, anymore, and I doubt the
emergency manager could care any less.

I inquired further and what ChemBob shared
with me as well as United Water’s rather
shocking response is after the jump.

[W]e never had a problem before
(granted we’ve only lived in Pontiac for about 1.3 years).
The first indication of a problem, on Jan 17 I believe,
was a tub full of bath water that, apparently, came out
clear and then turned brown while [my wife] was bathing.
This sounds to me like ferrous iron oxidizing to ferric iron
when exposed to the oxygen in the atmosphere and precipitating.
My first thought (paranoia) was that there might be an expensive
repair needed in the line to our house. Michele called our
next-door neighbor and spoke with her.
She ran her tub full of water and the same thing happened.
The neighbor then called United Water,
who apparently sent a truck out to purge the
fire hydrant on the corner. Why this would help, I don’t know.

The water seemed fine until the 19th, at which time it did the
same thing only with a lighter rust color.
I called United Water, had several calls ahead of me,
left a message notifying them of the problem and asking
them to call back and let me know what they would do
to correct it. Naturally they never called back.
We again called the neighbor, who again had the same problem.
Turns out that the day before (I think it was the day before)
she had spoken with our neighbor across the street who had
apparently noticed the water problem some time before us
and had been boiling her drinking water;
I don’t know if the second neighbor had notified United,
but it seems likely that she did. The first neighbor
also called United Water on the 19th, possibly also on the 18th.
As far as we can tell, they’ve done nothing to respond to our concerns,
including no return phone calls. Michele’s bath yesterday
(I’m a shower guy, didn’t notice) was apparently grey-colored water
with black flecks in it.

I haven’t been in touch with any others in the neighborhood
to determine whether they have called United.
We are in the [redacted] block of Cherokee Road in the historic
Seminole Hills district of Pontiac.
I mention this both because this is one of the nicest neighborhoods
in Pontiac (probably with the highest property taxes, but I don’t
know that for certain) and because many of us have steam boilers
and radiators for our heating.
This sort of contamination in the incoming water is not just a
health issue (although it can be a serious one),
but can be very damaging to the boilers,
causing sediment accumulation that can result in
improper operation and potential failure of the systems.

As you probably already know, United has been cited for violations
in other locations with regard to falsifying water treatment results, etc.
It certainly seems to me that the emergency manager and City of Pontiac
should have taken that into careful consideration before contracting United.
They should at least have an independent person
or company to monitor their performance.

Drinking water quality was one of the things we have always taken for
granted in this country. Our towns and cities always had the
health and well-being of their citizens as a priority.
Apparently the only thing that matters for the emergency managers
is the bottom line and the people can be damned.

I contacted United Water to ask them (a) what the source of
the contamination is and (b) why residents’ calls to them
were not being returned.

Here is the answer I received:

Thank you for passing this information along to us Chris.
We polled our utility field and office staffs and cannot
find any record of a report of this issue over the past several weeks.
We certainly want to get to the bottom of this as soon as possible
but do not know where to begin. If we can get any contact information
from the party raising this issue, we will be happy to follow up
and investigate the matter yet today. They can email us at or call at 248-335-6399.
Again, thank you for bringing this to our attention.
In other words, United Water does not appear to maintain records when
complaints about contamination of the drinking water of their
residents are received. No call logs. No record. Nobody knows nuthin’.
That’s public service on a budget, clear and simple.

Pontiac seems to be in the bulls eye in terms of mismanagement
by an Emergency Manager. Recently, U.S. Congressman Gary Peters
stepped in to help save the city millions in federal
grant funds that Schimmel essentially gave away.

When Stampfler privatized Pontiac’s water & wastewater treatment
to United Water, many questioned how on earth there could by
$2.8 million per year in money to be saved.
I suggested that hiring a company facing a serious
26-count federal indictment might be the reason.

It now appears that the cost-cutting move is beginning to
have a serious and worrisome impact on the residents of Pontiac.

If you or anyone you know lives in Pontiac and are having
issues with water quality, please contact me using the
email link under my logo.
This is a potential public safety and health issue
and I will be following it closely.

UPDATE: This is an update from ChemBob at Daily Kos:

United Water told our neighbor when she called in that no one
was doing any work on the water in the area.
She was told that they would send someone out to
flush out the fire hydrants.
That is what we observed about an hour later or so.
There was no work going on that we saw prior to that.
Some folks are saying that this is simply the
flushing of hydrants, totally normal.
If that’s the case, why didn’t United Water let the
residents know as happens pretty much everywhere else?
(I have personally gotten these notices.)
Also, too, why did they tell ChemBob’s neighbor that they
weren’t flushing hydrants in the area?
It seems very clear to me that customer service
is something they have cut to save money.
So much for Governor Snyder’s call for better
“customer service” by the government for Michigan residents.

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