Bechtel vs. Bolivia: Cochabamba’s Water Bills from Bechtel

For the poorest people in Cochabamba rates went up little, barely 10 percent.

– Gail Apps, spokeswoman for Riley Bechtel
January 3, 2002

That’s Bechtel Enterprises big lie about their water price hikes in Cochabamba. Now for the facts and the actual water bills to prove them.

 

First, a note of information about water rates. In Cochabamba, under both Bechtel’s subsidiary, Aguas del Tunari, and the public utility that ran the company before and after, SEMAPA, water rates depend on how a home is classified. Basically, these classifications have to do with how many water outlets a home has. According to the water company’s current chief of pricing, Rosario Ayoroa, the classification works like this: The poorest homes (R-2) usually have an indoor toilet, no indoor shower and maybe a water tap in the yard. Typically these families survive by selling vegetables or other items in the street and work well below the current minimum wage of $67 per month. The next group (R-3) are still poor by any standard. In addition to an indoor toilet they may have an indoor shower as well and perhaps a kitchen faucet. Typically these are households headed by workers who earn somewhere between $60 to $80 per month. Once a household has more than one bathroom it is considered in a higher category (R-4), not necessarily affluent, but not poor either.

THE TRUTH ABOUT BECHTEL’S INCREASE FOR THE POOREST OF THE POOR

Now look at Bechtel’s company’s (Aguas Del Tunari) actual bills and see how big a lie it is to claim that, “For the poorest people in Cochabamba rates went up little, barely 10 percent.”

Lucio Morales (click to see copy of water bill): In November 1999, before Bechtel’s rate hikes took effect, Morales had a monthly water bill of 25 Bolivianos (about $4.15). In February, after Bechtel’s price hikes took effect, his water bill jumped to 39.80 Bolivianos ($6.63), a jump of 60% not 10%. As the bill indicates, there is not meter reading, no increase in water use. This is one of many houses that have no water meter and is billed based on a basic rate. Classified “R-2” Morales’ household is among the very poorest of the poor. This bill would amount to more than 10% of the monthly minimum wage at the time.

Jose Aramayo (click to see copy of water bill): In November 1999, before Bechtel’s rate hikes took effect, Aramayo had a monthly water bill of 25 Bolivianos (about $4.15). In February, after Bechtel’s price hikes took effect, his water bill also jumped to 39.80 Bolivianos ($6.63), a jump of 60% not 10%. As the bill indicates, there is no meter reading, no increase in water use. Classified “R-2” Aramayo’s household is also among the very poorest of the poor. This bill would amount to more than 10% of the monthly minimum wage at the time.

THE TRUTH ABOUT BECHTEL’S BLAMING THE INCREASES ON INCREASED WATER USE

Acknowledging that they often hiked water rates by a great deal, Bechtel seeks to blame the Bolivians for using much more water. Again quoting Bechtel’s formal response:

Unfortunately, water bills sometimes went up a lot more than rates. That’s because as Aguas del Tunari improved service, increasing the hours of water service and the pressure at which it was delivered, people used a lot more water.

Consider these two examples, both families classified as just a notch above the poorest, but still poor by any standard:

German Jaldin (click to see copy of water bill): In December 1999, before Bechtel’s rate hikes took effect, Aramayo had a monthly water bill of 82 Bolivianos (about $13.67) in which he used 35 cubic meters of water. In January, after Bechtel’s price hikes took effect, his water bill jumped to 157.60 Bolivianos ($26.27) for the use of 38 cubic meters of water. This means that while his water use increased by less than 10% his water bill from Bechtel jumped by more than 90%. Mr. Jaldin’s monthly increase was equal to more than 20% of a monthly minimum wage salary, a typical earning for households with his water rate classification.

Saturnino Marin (click to see copy of water bill): In December 1999, before Bechtel’s rate hikes took effect, Marin had a monthly water bill of 88.5 Bolivianos (about $14.75) in which he used 39 cubic meters of water. In January, after Bechtel’s price hikes took effect, his water bill jumped to 131.80 Bolivianos ($21.96) for the use of 32 cubic meters of water. This means that while his water use actually decreased by 18% his water bill from Bechtel still jumped by nearly 50%. This clearly contradicts Bechtel’s claim that big increases were the fault of water users using more water and not the company increasing water rates.

BECHTEL’S INCREASES OVERALL – DIRECTLY FROM THE WATER COMPANY’S OWN COMPUTERS

In addition to these specific examples of Bechtel’s water price hikes, the current water company conducted a computer analysis of Bechtel’s water rate hikes overall (click here to see the complete analysis). This analysis shows that Bechtel’s company raised rates for the very poorest by an average of, not 10% (as Bechtel claims), but 43% and often much higher. The analysis also shows that, as a result of Bechtel’s forced departure and the return of water prices to what they had been before, Cochabamba families and businesses saved more than $3.4 million in 2001, money that would otherwise have gone to Bechtel’s company.

 

Bechtel vs. Bolivia
The Democracy Center’s Letter to Riley Bechtel
Riley Bechtel’s Response
The Democracy Center’s Response To Riley Bechtel
Bechtel’s Legal Action Against Bolivia
The Bolivian Water Revolt

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