Sale of Township Sewer System
Consolidated Overview of Process
Sewer Sale Exploration
- January 27, 2020 - Board approved valuation of the system by PFM at the Board of Supervisor public meeting
- April 27, 2020 - Board authorized PFM to proceed with exploration of sale at a Board of Supervisor public meeting
- May 26, 2020 - Board approved the appointment of special engineering services and general and special counsel legal services for the evaluation and sale at a Public Meeting
Sewer Sale Bid and Process
- September 22, 2020 - Request for bids is Issued
- October 12, 2020 - Township staff and PFM reviewed bid received from Aqua
- October 29, 2020 - Board of Supervisors special public meeting to present results of bid process
- November 9, 2020 - Board of Supervisors public meeting to review results and offer clarifications; Board authorized advertisement of public notice regarding Asset Purchase Agreement
- December 14, 2020 - Board of Supervisors held public hearing to approve the Asset Purchase Agreement and Ordinance 5 of 2020 for the sale of the sewer system to Aqua was approved
Public Utility Commission Approval Process
- January - July 2021 - Engineering and Utility Valuations mandated by PUC are conducted
- August 3, 2021 - Aqua filed an application for approval of the sale with the PUC
- February 24, 2022 - Two Public Input Hearings held by PUC
- July 8, 2022 - PUC approved the sale of the sewer system
Finalization of Sale
- Closing Date: TBD
- No vote to finalize the sale or closing date has been scheduled.
- Before the sale can go to closing, an agreement must be reached with Aqua to finalize legal details
- Until such time that the sale is closed, the Township will continue to incur costs related to maintenance and repair of the system
Sewer Customer Benefit Committee Minutes
- Why is Willistown selling the sewer system?
By exiting the business of sewer system operation, the Township can better focus on core government functions while ensuring the residents are still offered safe and reliable sewer service by a Commonwealth-regulated utility. In addition, the funds generated by the sale will be used to pay off sewer debt. The sale also allows the Township and ratepayers to avoid future costs of sewer system upgrades. Furthermore, it was concluded that a utility company such as Aqua could maintain the sewer system as it ages at a lower cost than a single municipality.
- Who approved the sale of the sewer system?
The Asset Purchase Agreement was approved by the Township Board of Supervisors in December of 2020, but it required further approval at the State level. The sale was subsequently approved by the Pennsylvania Public Utility Commission (PUC) in July of 2022.
- Didn’t an Administrative Law Judge recommend against the sale?
Yes, but the PUC is not bound by the recommendation of the Administrative Law Judge.
- Can the Township reverse the decision to sell the sewer system?
No. The Asset Purchase Agreement is a binding agreement between the Township and Aqua, and the sale has been approved by the PUC. The Township cannot legally take action to reverse the sale. Aqua has denied the Township’s requests to reconsider or terminate the sale.
- Isn't there an option to terminate?
Board of Supervisors Chair Bill Shoemaker addressed this in the statement on September 26, 2022.
- Wasn’t the sale appealed?
Yes. There were two requests for a “stay” – this is a request for emergency action. Those were filed with the PUC and the Commonwealth Court. The stay filed with the PUC has been denied. The stay filed with the Commonwealth Court has not yet been ruled upon.
In addition, an appeal of the PUC decision has been filed with the Commonwealth Court. This appeal has yet to come before any judge(s), and the timing of any outcome is unknown.
- When will the sale be finalized?
The Township will not close the sale transaction with Aqua while appeals are outstanding. Please refer to the statement from the meeting on September 26, 2022.
- What will be done with the money the Township receives from Aqua for the sewer system?
The Board has not yet made a final decision on the allocation of these funds. A portion of the funds must go toward repayment of debt, as well as transaction fees related to the sale. In early 2021, the Township formed a Sewer Customer Benefit Committee to develop ideas for fund allocation. Two ideas put forward include a Capital Replacement Fund to pay for replacing grinder pumps for residents in the Low-Pressure system; and a Customer Benefit Fund to stabilize sewer rates from potential increases from Aqua until the year 2030. These funds were created by Resolution 23 of 2020 but have not yet been codified or funded. Other potential allocation includes open space acquisition or capital project funding.
- Can Aqua unilaterally decide to expand the sewer system once they own it?
No. The Township does not relinquish control of its Sewage Facilities Plan under State Act 537 under the sale or any other agreement. No new extensions or additions can be made to the existing sewer system without the direct approval of the Township. In other words, the Township must approve the extension of any sewer mains beyond the areas that are already planned for public sewer. Public Hearings would be held and all parties notified if that happened. So, in brief; Aqua will not be able to add to or extend the existing sewer system at will.