Our Sewer System - going private or staying public?
In a recent Board of Supervisors meeting, during budget planning discussion, the topic of our sewer system popped up (again) - specifically the possibility of selling the Township-owned sewer system to a private company.
The upside of selling would be a one-time windfall to the Township coffers, but then it would subject residents to the whims of a for-profit company. There is enough recent and local history to know this is a terrible idea and should not be considered.
It is important to understand the costs of sewer maintenance have been going up for years, and the Township has stated that budgeted funds will run out soon. There will be an increase coming soon.
But a planned, limited increase to meet costs is far different than the private-company experience.
Municipalities get a quick influx of cash and once spent, it’s gone. Residents end up paying for the sale as the private companies increase fees to pay for the acquisition. There is no free lunch.
Once the sewer system is in the hands a private company, rate increases go through the PUC and are rarely denied.
Sewer rates will go up if we don’t sell the system, and they will definitely go up if we do sell. The difference is that the township needs to cover costs. The private owner is for profit. The Township should raise the fee at an incremental pace to maintain the system not to make a profit.
The residents in East Whiteland Township fought against their transfer and scored a major victory:
Towamencin Township residents are fighting the sale of their system. They have pointed out that Pennsylvania Water was not targeting distressed systems. They are actually targeting functioning systems (like theirs). https://www.thereporteronline.com/2023/03/23/towamencin-board-oks-new-sewer-system-buyer-at-lower-104-million-sale-price/
“Osei’s group is fighting the sale of the sewer system in Towamencin Township, a community of nearly 18,000 residents near Philadelphia, to American Water, the nation’s largest private water and wastewater company. Activists backed a home rule charter, passed by voters this year, to amend the county’s governing document to ban privatization of the system. Township supervisors, Osei said, are still trying to proceed with the sale, while residents are suing them to block it.”
“Many public water advocates acknowledge that sell-offs can help keep water systems running when municipalities can’t afford the maintenance costs. But in Pennsylvania, they say, many of the systems being bid on are in perfectly fine shape.”
“I don’t think they’re targeting distressed systems at all,” said Kofi Osei, a member of Towamencin Neighbors Opposing Privatization Efforts, a local activist group. “Our system is actually very well maintained, and we recently did some pretty substantial upgrades.”
Bucks County residents just fought off an unsolicited bid from Aqua:
Great information in this article about rate increases:
“Shade’s group estimates that completed acquisitions are costing ratepayers $70 million to $85 million annually in higher water bills, and pending sales could double that amount.”
“New Garden Township was the first sewer sale that state regulators approved after the passage of Pennsylvania’s valuation law. Ferguson’s group says the community has seen bill increases approaching 85% since the takeover.”
This is not a partisan issue. An interesting bit of follow-the-money from the Spotlight PA article: The water companies vying to buy municipal sewer systems are donating to both political parties. “OpenSecrets has tracked nearly 3,700 donations made by water companies or their associates to Pennsylvania candidates, totaling almost $2.7 million.”
Hopefully this will be a non-issue in Whitpain, and this will be the last time we address this.
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