Towamencin Township, a suburban Montgomery County community with a population of about 18,000, received bids in February fromPennsylvania American Water, the state’s largest private water utility,for the township’s system, about 71% more than the bid of its principal rival, Aqua Pennsylvania, the state’s second largest water utility.
The township supervisors voted 4-1 in May to accept the NextEra bid over vocal objections of residents who fear that homeowners and businesses will pay higher sewer rates to cover NextEra’s elevated purchase price. The opponents are organizing a ballot campaign to rewrite the town’s charter to block the sewer system sale and reverse the “backdoor tax increase” on sewer customers.
But private equity funds are showing heightened interest in buying municipal utilities, which require ever more capital to replace aging infrastructure and to respond to new climate and environmental challenges, such as contamination by. Unlike some other states that have enacted legislation that allow only fair-market acquisitions of distressed municipal utilities, Pennsylvania’s Act 12 legislation can make it attractive for any town to sell at a high price.
Christopher H. Franklin, the chairman of Essential Utilities, told investment analysts in October that an established water utility such as Aqua has an advantage because it can spread the cost of acquisitions and improvements across an existing customer base of nearly 500,000 customers in Pennsylvania.
They are gonna regret selling it, just ask the townships around them how they feel, once the freeze on keeping the sewer bills where they are and they go through the roof you are gonna have a bunch of pissed off residents
Watch rates inch up every year now.
Foot in the door plan, Aqua is worried.. Trust that.
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