Friday March 24, 2006 - Philipsburg, Sint Maarten, N.A.French side signs newwater supply contract
MARIGOT--Mayor Albert Fleming yesterday signed the first phase of the new contract with water distributor Générale des Eaux (Guadeloupe) that will finally relieve the Commune of the burden of absorbing losses it has incurred by being middleman in the water production and distribution process for the French side.
Under the terms of the 20-year contract, production company UCDEM and Générale des Eaux will form one company under parent company Veolia and will be totally responsible for the production and distribution of water, and repairs, while the Commune will be in control only of pricing, investments, and extension of networks if needed.
The restructuring coincides with the new reverse osmosis water plant that will come into operation this August, promising a greater capacity of water production. In addition there are plans for two more reservoirs in the Marigot area.
The Commune hopes to be able to extricate itself by June from its intermediary role which resulted in its incurring an annual debt of 1,500,000 euros. This was caused by the Commune purchasing water from UCDEM and then selling it back to the consumer at a cheaper price than it had paid for it, due to the cost being unaffordable to lower income families.
The Commune also had to absorb in its budgets all cost associated with burst pipes, repairs and other debts. The total now owed to UCDEM stands at 6 million euros.
Régie des Eaux, the entity set up by the Commune that allowed it to purchase water from UCDEM and monitor cost, will be disbanded under the new arrangement.
“For us (Commune) this is a great day and I hope in the next couple of months we can finally conclude this whole matter of water production and distribution,” Fleming said.
It was clarified in the meeting that frequent water shortages were not the fault of badly placed pumps, but inadequacy of the outdated production plant to produce enough water for the French side during high season. The evaporation method of production also meant very high water temperatures that created their own set of problems.
Good news is on the horizon for consumers, as the price of water will eventually be reduced by nearly half from the present rate. But First Deputy Mayor Jean-Luc Hamlet cautioned that reductions would be passed on to the consumer gradually, as the deficit still has to be paid back to UCDEM.
“We are currently negotiating with UCDEM on the conditions for its reimbursement, which hopefully can be paid back rapidly,” said Hamlet.
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