Oct. 24 – The South Orange Village Township denied an Open Public Records Request (OPRA) for the draft contract and bid from New Jersey American Water for the sale of the public water distribution system. Voters will decide whether or not to approve the sale on the November ballot. 

This denial is an aberration from standard practice. The two other NJ jurisdictions that will vote on water or sewer system sales this fall have already disclosed this information. Manalapan Township released the Veolia bid and draft contract in response to an OPRA and posted them online, and Gloucester Township has posted this information online. 

In response, Sam DiFalco, a New Jersey organizer for Food & Water Watch, issued the following statement: 

“South Orange residents deserve full transparency and accurate information as they head to the polls to decide the future of their public water system. The Village’s unwillingness to publicly disclose the draft contract for the proposed sale of the water utility that voters will decide via public referendum next month undermines transparency and public trust ahead of this critical decision. On top of this, discrepancies over capital improvement costs, overstated water usage, and misleading rate comparisons have created a situation where many residents may be misled about the viability of retaining ownership over the water utility. After conducting our own research it has become clear that the Village has not  done its due diligence to explore public options for retaining the water system and keeping critical decisions about the Village’s drinking water under local, democratic control. The Village must disclose the sales contract and company’s bid immediately as voting is already underway.”

Additional Background 

South Orange Village’s lack of transparency raises red flags, especially as several discrepancies have come to light in recent days:

Yet unsubstantiated estimate of $50 million in capital improvements over 10 years

In its 2023 filing to the state under the Water Quality Accountability Act, the village indicated that it planned $17.5 million in capital improvements over the next 7 years. A detailed capital improvement plan has not been released publicly. 

Overstated water usage and misleading bill comparisons

The village’s rate comparison may mask the added costs for low-income households under private ownership. South Orange Village said that the average customer uses 9,000 gallons a month to calculate the bill differences between public and private ownership. This estimate appears to be the total usage in the village divided by the total number of customers. The average residential customer uses 6,500 gallons a month, based on data provided in information requests to the company. A typical – or median – household is expected to use even less, as larger uses tend to skew the average higher. 

Currently, households with lower water usage enjoy larger savings with public ownership, and low-income households tend to use less water. Under current rates, an average household using 6,500 gallons of water a month pays 29 percent less if they have service from South Orange Village than if they have service directly from New Jersey American Water. A household with a more typical indoor usage of 5,000 gallons a month pays 39 percent less for village water than corporate water. 

Failure to explore public sector alternatives

Residents are asking the village to explore other options that could lead to lower rates and more reliable service, including a new water supply partnership with the North Jersey District Water Supply Commission and shared services with neighbors.