Calming the waves at the Chester Water Authority
That gush of wind you just heard is not the remnants of Hurricane Florence rolling across Delco.
No, that would be thousands of loyal customers of the Chester Water Authority heaving a sigh of relief. It now appears the iconic Delco company that has provided sparkling clean water for decades is not going to be sold.
That appears to be the latest word from the city of Chester, where city officials continue their efforts to prepare to pull the struggling city out of its longtime status as a “distressed” city under the state’s Act 47.
The city has been under Act 47 since 1995 and is facing a deadline to at least show the state that it is making progress toward putting the city back on an even fiscal keel.
Of course, in order to do that the city needs revenue.
That led many people to look in the direction of the Chester Water Authority, which traces its roots back 1866. The company brings water through 656 miles of pipelines from the Susquehanna River and the Octoraro Reservoir on the border of Chester and Lancaster counties to Delaware County.
Chester Water Authority provides water for 19 municipalities in Delaware County, as well as several in southern Chester County.
It was also seen by some as providing a way out of the financial abyss where the city of Chester has wallowed for years.
That certainly seemed to be the impression left by Econsult. They’re the company hired by the state to oversee Chester’s finances. They looked at Chester Water Authority and saw dollar signs.
Those fears jumped considerably
when it was learned that the giant water utility Aqua America had made an unsolicited bid of $250 million to purchase the local water company.
Employees, residents and customers were not thrilled. They feared a huge rate hike should Aqua take over. They showed up en masse at a public hearing to oppose any sale of the company. The company quickly rejected the offer.
That settled the troubled waters a bit. But the problem did not go away. With Aqua continuing to lurk, and indicating negotiations were ongoing, the next step in the process seemed to be a new move by Econsult and the city, looking at the possibility of splitting off a portion of the company that serves city residents and selling that.
Now it appears the city might
not need revenue from a sale of the water company at all in its efforts to escape Act 47. Chester has until Oct. 25 to adopt an exit plan.
City officials stress that they have methodically been chipping away at Chester’s deficit, which once stood at more than $8 million. The city is pointing to several steps that have allowed it to improve its bottom line, including a consolidation of the fire department, interactive gaming revenues and new parking revenue. The city is banking on a new parking agreement with a thirdparty operator to handle parking in Chester, a move they say could bring in an additional $700,000 in revenue by next year.
What they are not banking on right now is a sale of Chester Water Authority, despite the recommendation from Econsult last spring.
“That’s not something city officials are looking to do,” said Cleveland Aigner, press spokesperson for Mayor Thaddeus Kirkland.
That no doubt comes as a huge relief for the 42,000 loyal, longtime customers of Chester Water Authority in 34 Delaware and Chester county municipalities and well as the city of Chester.
They feared a sale could hit them dead square in the spigot – as well as their pocketbooks. They pointed out that Aqua customers in general pay more for water, in some cases nearly double the Chester Water Authority rate. Aqua Pa. tried to offer assurances they would not hike rates immediately, but the company’s recent request for a rate hike to address longstanding infrastructure problems did nothing
to calm the waters of Chester Water Authority customers.
There are a lot of different hands in this high-stakes game of poker. There is the city of Chester. The Econsult folks representing the state. Aqua Pa. Chester Water Company and its customers. And dozens of local towns and government entities.
They haven’t all always been on the same page in this discussion. Chester Water Authority officials have openly questioned the motives of Econsult in recommending a sale.
With assets of $4 billion and a sparkling credit rating that matches its water, it’s no surprise that Chester Water Authority is being targeted.
For now, the company and its loyal customers seem to have dodged another bullete.
We’ll drink to that.