At last night’s special meeting, the South Orange Council voted to approve the sale of the village water system to NJ American Water for $19.7 million – a move that puts the final decision on the sale to voters in the November election.

Food & Water Watch organizer Sam DiFalco issued the following statement in response: 

“Privatization is the wrong solution for South Orange, since selling to a for-profit company will increase the long-term costs borne by households and local businesses. Under American Water, residents can expect to see a major hike from current costs. While rates normally go up to pay for infrastructure upgrades or the removal of lead service lines, the magnitude of those rate hikes are what really matter – and that is when you see the differences between a publicly owned and operated system and one owned by a private company.

“Under private ownership, ratepayers do not just pay for the improvements to their own municipality’s system; they must also pay for the sale price of the system itself, along with the cost of all the company’s other acquisitions. Charging ratepayers is also of course how a private company becomes profitable; corporate owners are authorized to earn a rate of return of around 10 percent.”“We urge South Orange voters to vote no this November, and to keep the system public. There are alternatives to selling the water system that should be explored in a transparent and democratic manner. By maintaining public ownership of a valuable public asset, the town can keep its options open. With a sale, it essentially gives up that flexibility permanently.”