Now Public, Utility Still Faces Infrastructure Challenges

The water system in Missoula, MT, had been private for over a century. In June, the city regained ownership of the system and over six months later, it’s interesting to see where the transition stands.

For instance, in a struggle that is emblematic of the challenges water utilities face across the country, Missoula is in need of infrastructure repairs. The system is clocking a 50 percent leakage rate, the Missoulian reported.

Missoula Water Superintendent Dennis Bowman estimated that the water "leaked about evenly from city mains and from pipes leading to private homes. It’s the homeowner’s responsibility to replace those pipes, but Bowman is interested in coming up with a loan or financing option for citizens who need to do the work," the report said.

Missoula's ownership struggles date back many years. The acquisition of the water utility by the city "required a lengthy and complicated court-supervised eminent domain (the right of government to take private property) proceeding after decades of effort by city leaders. Mountain Water Company, as it was known, had been operated by a sole proprietor for many years, making Missoula the only city in Montana that did not control its own water system," Water Deeply reported.

Leakage and infrastructure challenges are two of the issues that prompted the city to pursue ownership. Mayor John Engen explained the situation to Water Deeply.

"This system, under private ownership, leaked more than half of the water that it pumped – to the tune of 4 billion gallons (18 billion liters) a year. The first company that bought the system had a business plan wherein they would raise rates on an annual basis by 5 percent. What happened was, rates go up, the system further deteriorates and the value increases," he said.

"So if we were not to pursue ownership, we were setting up the community to have a system that, at some point, most likely would fail by virtue of lack of investment," he continued.

Missoula is hardly alone in needing to address infrastructure upgrades. On an infrastructure report card issued by the American Society of Civil Engineers (ASCE), wastewater and drinking water infrastructure in the U.S. scored a “D+” and a “D,” respectively.

The report called for “transformative action from Congress” and other policymakers.

To read more about the differences between public and private utility ownership visit Water Online’s Funding Solutions Center.