Is Nestlé really a good neighbor?

Nestlé Corporation’s desire to bottle water in Chaffee County has stirred several groups of pros and cons to argue the merits of their particular cases. In this letter, I will pass over without comment on the various arguments. Instead I will focus on the financial return or rather the lack of financial return to Chaffee County.

As it stands now, Nestle touts that it will pay a US $80 thousand dollar windfall annually in the form of property taxes to Chaffee County, but it is not clear that this is a total increase due to the fact that taxes are already paid on many of the land parcels in question. They also promise a one time expenditure of US $1.9 million dollars in construction costs. Again it is unclear how much of this will benefit Chaffee County citizens or even Chaffee County. Then there is promise of buying diesel fuel in Chaffee County and the tax on that fuel being a benefit to Chaffee County. Again Nestlé offers a promise, but without commitment or validation. Finally, Nestlé has promised to be a “GOOD NEIGHBOR” with arm waving promises of help to schools, sports teams, and charities. When questioned as to what this good neighbor help might be, Nestlé stated this help would consist of supplying bottled water to the above mentioned entities.

All of these “promises” come from a company that had total revenues in 2007 (last year for which figures were available) of US $121,103,550,000.00. (That’s billions with a capital “B”.) Their net profit in 2007 (also in billions) was US $11,990,770,000.00 with a single share being paid a dividend of US $31.09. By any standards this is a wealthy company.

Now to what Nestlé wants to do in Chaffee County. They want to take 200 acre-feet of spring water and bottle it. This amounts to enough water to fill 695 million 12-ounce bottles each year or 1.9 million 12-ounce bottles each day. True, Nestle will incur costs to bring these bottles to market. In fact, they are negotiating a contract with the City of Aurora, Colorado to pay the City of Aurora US $200,000.00 each year for 200 acre-feet of water to replace the spring water they are taking from Chaffee County which will be lost to the Arkansas River. Again, that is US $200,000.00 paid to the City of Aurora and the “promise” of something to Chaffee County.

I propose, that if Nestlé wants to do business in Chaffee County as a good neighbor, Nestlé would OFFER TO CONTRIBUTE a royalty of say a penny or even a tenth of a penny a bottle to Chaffee County for the length of the project. This would enrich the treasury of Chaffee County to the tune of either US $6.9 million or US $695 thousand a year. (What a windfall to a poor community and who would deny that the County needs the money.) I hope is that Nestlé will OFFER TO CONTRIBUTE a half penny a bottle for the privilege of taking Chaffee County and Colorado water. That would net US $3.5 million for the treasury of Chaffee County. Never lose sight of the fact that Nestlé would not lose a penny for their generosity as they would simply pass this cost of doing business on to the consumer.

Finally, if Nestle does not want to be a good neighbor and OFFER TO CONTRIBUTE to the general fund, I urge the County Commission to let Nestlé walk and find another cheap water site somewhere else.

Dr. Edwin J Sherry is a resident of Chaffee County.