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In yet another example of privatization gone well in Michigan, services have significantly improved and costs decreased since a wastewater treatment system was bid out to a private company.
Earth Tech Operation Services Vice President Bill Reedy reports that since his company took charge of operation and maintenance of the South Huron Valley wastewater treatment system just a year ago, it has saved the South Huron Valley Utility Authority (SHVUA) more than $1 million. Earth Tech was awarded a five-year, $10.5 million contract by SHVUA last year.
SHVUA gained jurisdiction over the system from Wayne County on March 1, 1999, and entered into an operations and maintenance agreement with Earth Tech, which was selected from five contractors to provide operations, management, and maintenance of the system.
"The Authority sought control of the wastewater treatment facility from Wayne County nearly 10 years ago on the premise that we would save money controlling the system ourselves," says Curt Boller, chair of SHVUA and supervisor of Brownstown Township. "We completed the acquisition this past year and now we will realize the savings we've wanted."
The treatment plant was built in the mid-1980s, and in 1989, SHVUA was formed to take ownership of the plant from Wayne County, which fought the acquisition but finally lost last year.
SHVUA is a municipal "corporation" made up of three cities (Woodhaven, Flat Rock, and Gibraltar), three townships (Van Buren, Huron, and Brownstown) and one village (South Rockwood).
SHVUA's customer territory includes a population of approximately 90,000 people and is located in the downriver area west and south of Detroit.
The facilities owned by SHVUA and operated by Earth Tech include the treatment plant, 25 miles of "force main" (pipe that uses pressure to force movement of sewage), an interceptor sewer (the pipeline by which the wastewater from each of the seven communities is conveyed to the treatment plant), and two pumping stations.
Earth Tech also administers a program for the pre-treatment of sewage from 13 industrial discharge sources to ensure that the wastewater plant can treat the discharge successfully. The discharge sources are required to pre-treat their discharge in order to accommodate the treatment capabilities of the treatment plant.
Reedy explained that Earth Tech handles all day-to-day employment and personnel issues and operation and maintenance details, which allows SHVUA to focus on issues of managing the plant such as long-term growth, rate setting, and determining future service areas.
Reedy added that in the past year Earth Tech was able to save SHVUA an additional $100,000 annually through an innovative plan it devised for disposing of solid waste created by the treatment process. Earth Tech took the environmentally friendly step of designing and building a treatment system for bio-solids (sludge resulting from wastewater treatment). The system manipulated the sludge into a useful fertilizer for farmers. Previously, Wyandotte County simply incinerated the sludge and dumped the ashes in a landfill.
The new partnership between Earth Tech and SHVUA also has won union acceptance. Reedy said that Earth Tech worked closely with members of AFSCME Local No. 1659 (the local affiliate of the state and local employees' union) to help workers in the transition from being employed by the city to becoming members of the Earth Tech staff.
Earth Tech's innovations at the South Huron Valley Utility Wastewater Treatment Plant in its first year of privatization included the following:
Savings of more than $1 million in operating and maintenance costs;
Electrical savings of nearly 6%;
Reduction of chlorine usage from 800 pounds per day to less than 100 pounds per day;
Implementation of a more environmentally friendly solution to the problem of disposing of solid waste, resulting in a savings of more than $100,000 for participating communities;
Negotiation of a collective bargaining agreement with AFSCME that offers better wages and benefits to plant operation and maintenance employees;
Addition of technical and mechanical expertise necessary to catch up on corrective maintenance; and
Implementation of a comprehensive preventive maintenance program.
Earth Tech's positive performance should prompt other utility authorities and/or municipalities to consider the possibilities and rewards of privatizing their own wastewater treatment systems. The results achieved in the South Huron Valley deserve to be replicated throughout Michigan and the nation.
Alan Blanchard is an adjunct professor at Cornerstone University in Grand Rapids.
