At two bits a gallon, the water sold out of those big blue vending machines outside supermarkets is the elixir of choice for thousands of Angelenos who can't afford to have bottled water delivered.

But the very appeal of these machines safe water has come into question following the release of a county study claiming that water from vending machines contains an average of 163 times more bacteria than tap water.

The controversy has shed light on the small but growing water vending industry estimated at about $200 million nationwide that has a strong foothold in Southern California.

Water vending machines take tap water and pass it through a filtration system that removes chlorine and other particles. The water is then dispensed in gallon containers.

The industry is currently required to submit test results on its water to the state Department of Health Services every six months. As a result of the new study, county officials want more frequent inspections.

"The industry says they check their machines every week," said interim Agricultural Commissioner Cato Fiksdal. "But you have to do more than check the machines. You have to replace the filters and membranes and clean the spouts more frequently than the industry is currently doing."

Much of the vending-machine sales are to immigrants distrustful of tap water, who want fresh-tasting water without paying bottled-water prices.

"Many people from Latin America and Asia took with them the habit of not drinking local tap water, because it was often not safe," said Jerry Gordon, president and chief operating officer of Carlsbad-based Glacier Water Services Inc., the region's dominant water vending company. "They are used to boiling tap water. When they come here, they realize they can buy water at a cheap price."

Gordon said the type of bacteria county inspectors tested known as HPC bacteria is generally not considered a health risk. The greater risk comes from the coliform class of bacteria, which includes e-coli and other dangerous bacteria.

Gordon also cited a state Department of Health Services finding that bacteria levels in vending-machine water is well below standards set by the World Health Organization.

"To get the bacteria levels in our water down to the levels it is at in tap water, we would have to reintroduce chlorine to the water," Gordon said. "The very reason why people switch to our water in the first place is to get away from the taste of all that chlorine."

The industry has been gradually winning over health- and taste-conscious consumers who were part of the bottled water craze of the '80s, according to Los Angeles-based consultant Tim Clark, a former board member of Glacier Water. These consumers didn't like the taste of tap water and grew increasingly concerned about groundwater contamination, he said.

Some consumers are now switching to vended water because it is so much cheaper, Clark said. Water from a vending machine typically costs 25 cents a gallon, while water bottles on store shelves can cost $1 a gallon or more. And water delivered to homes runs $1.60 to $1.75 per gallon.

Locally, the biggest beneficiary of these trends has been Glacier. The company posted nationwide sales of $60 million last year, up from $46 million in 1996, with the majority coming from California and other Western states.

In L.A. County, Glacier became the undisputed king of the water vending industry after it purchased rival Aqua-Vend last year from Pasadena-based McKesson Water Products Co., a unit of San Francisco-based McKesson Corp. (McKesson also owns Sparkletts Drinking Water.)

Glacier now has about 3,000 water vending machines in the county, or about 55 percent of the estimated 5,400 vending machines countywide.

After Glacier, there are about 40 small water-vending companies, virtually all with less than a 5 percent market share.

Gordon and Clark said it is too early to gauge whether the study will have an effect on sales of vended water. Gordon said his company received about 75 calls in the week following release of the study; after hearing the company's explanation, none of the callers said they planned to stop buying the water, he said.

County supervisors, meanwhile, sent a letter to the state Department of Health Services formally requesting control of the inspection program. DHS officials say they expect the review of that request to take about a month. Meanwhile, Gordon says he plans to work with county officials in trying to resolve the issue.

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