United Water and City of Atlanta Sign Nation's Largest Public-Private Partnership for Water Operations

HARRINGTON PARK, NJ, November 10, 1998 -- United Water Resources (NYSE:UWR) announced that its affiliate, United Water Services, today signed the nation's largest public-private partnership contract with Atlanta for water operationsæa 20-year agreement that will save the City over $400 million. The agreement calls for United Water, which will receive an annual operations fee of approximately $21.4 million from the City, to begin managing the water system in January 1999.

United Water will convert one of the nation's largest water systems to private management and operation. "This contract clearly establishes United Water as the leader in the contract-operations market," said Donald L. Correll, chairman and CEO of United Water. "We've signed long-term management agreements over the past 12 months with the cities of Indianapolis, Milwaukee, San Antonio, Gary, Indiana and now Atlanta."

"Today marks the end of a process we began in January 1997 when I announced our plans to pursue private management of our water system," said Atlanta Mayor Bill Campbell. "Although the process has concluded, this day really marks the beginning of a partnership which will result in tremendous savings that will reduce the amount our water customers will have to pay in the future. Our citizens and ratepayers will benefit by improved technology and more efficient and innovative approaches to management. This contract will be a win-win situation for all involved."

Correll pointed out that the addition of Atlanta strengthens United Water's position as the nation's fastest growing contract operator of water and wastewater services. "Since we restructured our United Water Services affiliate with our strategic ally Suez Lyonnaise des Eaux about one year ago, our success in the water and wastewater industry has been unmatched," said Correll.

United Water's affiliate, officially known as United Water Services Atlanta, brings together United Water Services and its local partner Williams-Russell and Johnson, Inc. (WRJ), an Atlanta-based engineering and design firm that has worked with the company for the past six years on wastewater plant operations in northern Fulton County. WRJ is one of the preeminent, minority-owned engineering firms in the country and was instrumental in the design of the Georgia Dome.

Beginning January 1999, United Water Services Atlanta will operate and maintain the city's two water treatment plantsæHemphill and Chattahoochee; 12 water system storage tanks; seven zone-transfer pumping stations; 25,000 fire hydrants; and a 2,400-mile network of water distribution mains. United Water will install a premier computerized maintenance management system to track and record all maintenance and repairs performed for the City, which will have on-line access to the system at all times. The company will also manage billing, collections and customer service functions as well.

The Hemphill and Chattahoochee facilities are currently producing a combined average of 105 million gallons per day (MGD) and have capacities of 136 MGD and 56 MGD respectively. The two facilities serve 1.5 million people and cover an area over 650 square miles both inside and outside Atlanta. The City will provide compliance oversight and monitor United Water's performance of the operation during the contract period.

David Sherman, president of United Water Services, said that the company looks forward to working with Atlanta water department employees and improving the efficiency of the water system operations. "We look forward to sharing our philosophies on labor relations and technological improvements," Sherman said. "We strive to provide better service to customers, and to impact economic development with a unique approach by assisting small businesses in the Empowerment Zone."

"Atlanta is a modern, internationally-renowned city that is well prepared for the challenges of the 21st century," said Jean-Michel Brault, chief executive officer of United Water Services. "We fully expect to add to the city's fine reputation by carefully managing and improving the water system."

United Water Services, headquartered in Harrington Park, NJ, is a leading provider of water and wastewater services in North America. The company is a joint venture of United Water Resources (NYSE:UWR), the nation's second largest investor-owned water services firm, which provides water and wastewater services to about 7.5 million people in 19 states, and Suez Lyonnaise des Eaux, the world leader in environmental infrastructure services, which provides water and wastewater services to more than 70 million people in 120 countries. More information about these companies can be obtained through the company's website at www.unitedwater.com.