Editorial: Money down the drain

An audit that shows Camden's faulty water system is plagued by leaks, overflows, and mismanagement that has cost taxpayers millions of dollars raises new questions about state oversight of that city.

The water supply is in such dire straits that it compares to water systems commonly found in developing nations, according to a recent state audit. Besides losing 45 percent of the water to leakage, overflow, meter inaccuracies, and billing errors, the audit found that the private company that operates the system failed to protect water from contamination.

Camden has been under state authority since 2002. Where were state officials, including the state-appointed chief executive officer, who manages the city, when public funds were running down the drain and unsuspecting residents were potentially put at risk?

Like the brown water often seen running from Camden faucets, dollars flowed unchecked, and frequently unauthorized, to United Water Co. Besides shoddy paperwork, there were billing errors and meter inaccuracies.

Adding insult to injury, much of the city's water supply is neither used nor billed, a missed revenue opportunity that the cash-strapped city can ill afford.

While the state once again was asleep at the wheel in governing Camden's purse strings, there is plenty of blame to go around. City officials failed to enforce the lucrative contract with United Water, allowing the politically connected company to cost the city $1.7 million in annual losses.

As a result of the audit, the city is now seeking to recoup $29 million in refunds from United Water. Consumers who were stuck paying dramatically higher water bills should also get refunds.

Camden residents have long complained about the city's poor water quality, and the audit by the New Jersey Office of the State Comptroller suggests that they have legitimate concerns that must be addressed.

United Water disputes the audit findings and claims it has made significant system improvements. But it could not provide documentation that proved it had actually completed mandated inspections.

The water company also failed to maintain vents that prevent insects and small animals from entering the water supply. Yet it continues to insist that the health and safety of Camden residents were never at risk.

The state comptroller wasn't convinced of that, and maintains that mismanagement is prevalent. It's time to take a closer look at the company's 20-year contract to see if the city can explore other options that would make the system safer and more efficient.