MADISON — Cities like Madison and Milwaukee are flushing taxpayer money down the drain with exclusionary bidding rules built into local government plumbing codes.
It’s yet another example of how government exclusions and anti-free-market policies hurt business and taxpayers.
Madison and Milwaukee use closed bidding processes for pipe and pipeline projects that exclude the use of less costly piping material in favor of more expensive ductile iron pipe. The city of Milwaukee’s strict adherence to plumbing’s Iron Age forced its taxpayers to pay about $15 more per foot of 12-inch pipe than its neighbor to the west, Waukesha — $65.30 per foot versus $40.24. Waukesha, meanwhile, paid $69.53 per foot for 20-inch pipe compared to $110.22 in Milwaukee.
A measure known as the “All Types of Pipes” bill would lift the prohibitions on materials that “meet the project’s standards … unless there are sound engineering practices suggesting that a particular type of piping materials be used…”
In other words, if the alternative pipe fits, you must admit.
“Open competition and transparency in project planning and delivery, that’s what benefits taxpayers and that’s what AB (Assembly Bill) 450 is all about,” said Rep. Rick Gundrum (R-Slinger), one several Republican co-sponsors of the bill.
The lawmaker said the legislation doesn’t create a mandate. Local governments ultimately can go with whatever bid they choose, but they at least must consider bids with other materials.
“It’s just another tool for the toolbox, to get the best bang for the buck,” Gundrum said.
Cities with codes that exclude plastic and other pipe materials in some cases have cost their communities significantly more than those that have opened up the bidding process.
A report from the American Chemistry Council (ACC) found piping savings of as much as 29 percent in communities with open competition.
The report compared plumbing costs in four cities: Madison, Milwaukee, with closed-bid practices, and Kenosha and Waukesha, which allow various plumbing materials in project bids.
The cost differences can quickly add up. Milwaukee installed nearly 243,000 linear feet of pipe between 2015 and 2018, totaling more than $8.8 million in pipe procurement expenses, according to the the Chemistry Council.
A competitive bid process would deliver cost savings of $75,000 per mile of 12-inch water pipe purchased, the report estimates.