The Falls Church City Council’s action Monday to set in motion a process to involve the City’s residents and others in a deliberative process aimed at deciding what to do with the City’s besieged water system is wise and sound.
It will not surprise us if an overwhelming consensus of citizens develops quickly to call for the sale of the system to the proverbial highest bidder, a process that would be sealed with a public referendum this November.
The system is a very valuable asset, but constraints placed by the courts and Fairfax County political leaders on its ability to return any benefits to the City’s taxpayers make it a non-performing asset. Moreover, with Fairfax County planning to take control next summer of the pricing structure that the system can use to provide service to its over 100,000 customers in Fairfax County, it is likely that the system will not be able to cover its costs, and burden City taxpayers with a need to make up the difference.
So, the City has the option of saying, “Begone with all that!” By selling the system to an entity that can, by law, profit from it – such as an investor-owned utility or public authority – the City will derive a very handsome return from a system it has maintained remarkably well since the 1930s.
If that happens, then Fairfax County users of the system who’ve complained that they pay slightly more (on average about $15 a quarter) for Falls Church water than Fairfax water, will find themselves having to subsidize a handsome return on investment by the system’s new owners. The new owners and their rate structure would be regulated by the State Corporation Commission, and not the Fairfax County government.
As has been well documented, privatization of utilities usually leads to higher costs and poorer service. Unfortunately, this will be the fate for Fairfax County users if the decision is made by City residents to sell their system to the highest bidder.
But it has to be beyond the concern of City residents at this point to care too much for the well-being of neighbors that have behaved so badly concerning the water system in recent years.
It appears that Fairfax County, which hoped it could pressure Falls Church into crying “uncle” and coughing up its system to it, may have overplayed its hand in this matter. Falls Church will be under no obligation to sell to any bidder other than the one that offers the highest dollar amount.
There is no doubt that the misery brought on Falls Church in recent years by Fairfax County was motivated by the county’s greedy desire to gain from servicing the huge new development projected for Tysons Corner.
But as deliberations begin among Falls Church residents that may result in a referendum only City residents can vote in, it is less certain than ever now that the county will get its way.
