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Rock Island ends talks of water, sewer privatization; turns to federal funds instead

For 18 months, Rock Island aldermen have discussed selling the utilities to a private company. Now, they say public opposition & federal funds have ended the talks.

ROCK ISLAND, Ill — Rock Island aldermen have officially ended 18 months of discussions over selling the city's water and sewer utilities to a private company. 

In a statement, City Manager Randy Tweet says the decision came after disapproval from residents, along with a desire to focus on other, large upcoming projects. 

"It's something [the council] has been considering for a while and gathering information. And the council just reached the point where they felt it was not best to move forward," he told News 8. 

Tweet was careful to mention that the past 18 months of discussions had never been the city actively moving forward with plans. Instead, he referred to the year and a half of talks as strictly information gathering. 

"I don't think anybody wanted it, I think what they wanted to do is just find out the information. Their goal was to find out if a sale would be in the best interest of the citizens," he said. 

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During that time, Rock Island was specifically corresponding with Illinois American Water. 

The move to privatize was deeply criticized by local residents, utility employees and unions. For months, protests were staged outside of city hall, and council meetings were filled with Rock Islanders, angry over the potential sale of their utilities. 

For many, the fear of no local accountability, especially for price increases, as well as a loss of control, were the biggest reasons to protest. 

At the July 26 council meeting, Paul Idman, a Rock Island resident of over 40 years, begged the council to consider the gravity of their decision. 

"This decision you are going to make is going to affect every man, woman and child in this city for the next 50 or more years," he said. 

Another public comment that night came from Josh Ship, who questioned, "Will [Illinois American Water] pay cost? Or will they pay cost plus profit?" 

Even State Rep. Mike Halpin turned out for one pre-council protest. 

"History has shown us that privatization doesn't always end up with citizens being a priority for the company," he told News 8. 

On the other side, Illinois American Water argued it doesn't increase utility rates whenever it wants. Spokesperson Karen Cotton told News 8 that rate changes only occur after a months-long process, filled with checks and balances. 

"There's sworn testimony. There's data requests. There's opportunity for the public to get involved and to make their comments heard," she said. 

Furthermore, she said Illinois American Water could provide a solution to Rock Island's budget problems.

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According to Tweet, the city never got far enough in the process to officially receive a bid from any private company, laying out how much money Rock Island could have made in a sale. However, Second Ward Alderman Randy Hurt did confirm the number was in the millions. 

"Could that cash be put to better use," questioned Tweet. "Fixing our roads or paying down our debt? Putting more money into our infrastructure? The council was looking at all the options." 

In fact, Alderman Hurt didn't shy away from the fact that the sale could potentially have benefitted the city, however, it wasn't what the residents wanted, so the council decided not to pursue it further. 

"While privatization would potentially benefit the city and relieve bond debt, taking the burden of EPA mandates off the city and providing some money for much needed infrastructure improvements, most of the council felt that it really should not be left up to seven council members," he said. "We felt this decision should be up to the citizens."

Hurt felt that if the council passed the sale and the issue came up in the next election as a referendum, the initiative would have been voted down by residents. 

"I think it would have failed at the end," he said. "I think we [would have] just prolonged the inevitable." 

Now, he says the council is more focused on distributing the city's $26.5 million in federal Covid relief funds. Currently, Rock Island has not decided how to allocate the money. 

"I feel like [privatization] would be something that's gonna distract from the other things that we're doing. I think it was something that would be hanging over our head for the next year and a half to two years, while we went through the process." 

Hurt went on to explain that the $26.5 million from the American Rescue Plan would hopefully help the city's numerous infrastructure needs. 

"I personally would like to see a majority of those funds go towards infrastructure improvements," he said. "I mean, that's a one-time-shot, in my opinion, to fix a lot of those problems that cannot probably otherwise be funded." 

In a statement, Illinois American Water said they respect the decision of Rock Island's mayor, city manager and council members to discontinue talks. 

"We are grateful to them for allowing us the opportunity to work with them and learn about the Rock Island community over the past 18 months," the statement read. "We thank those members of the business and labor communities for their unwavering support. Professional water companies like Illinois American Water can provide a proven value and solutions to communities. We appreciate the opportunity in Rock Island. We remain available to help the Rock Island community." 

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