Board approves $75.1M sewer system sale
LIMERICK >> The Limerick Township Board of Supervisors unanimously approved the $75.1 million sale of the township sewer system to Aqua Pennsylvania Wastewater Inc. during Tuesday’ s meeting.
The deal is expected to close in the fall of 2017, following a review by the Pennsylvania Public Utility Commission.
The seven current township sewer employees will become fulltime employees with Aqua with substantially similar compensation and benefits, according to the company and township officials.
The goal of the sale, according to supervisors, was to fund future capital projects for the police, volunteer fire companies and public works department and reduce township debt. With increasing demand for services, this new deal is said to ensure the community will be in good hands for the foreseeable future.
“Police protection, fire and emergency response services, and the need to maintain a road network of approximately 100 miles are the primary services Limerick must ensure to maintain the vitality of this community not only for today, but for future generations” supervisors’ Chairman Thomas J. Neafcy Jr. said in a press release.
“We are pleased to accept this bid and to be able to fund these important capital projects without the need for increased taxes,” Vice Chairwoman Kara Shuler said in the release. “We also realize that the excess funds provide an opportunity of financial stability and stable tax rates for this community for many more years if a proper investment strategy is undertaken by the board.”
Aqua’s $75.1 million bid came in 43 percent higher than the other two offers. With this deal, the town--
ship will also receive an additional $400,000 for pending development, according to a presentation made during Tuesday’s meeting.
The next step in the process will be the submission of an application to the Public Utility Commission, whichwill review the details prior to the actual closing. Until that time, the township will continue to operate the sewer system. As the sale closing date approaches in the fall of 2017, the public will be notified of the pending change by Aqua along with contact and billing information, the release states.
The sale closes the book on a tumultuous history for the sewer system.
The township has run the system since 2008, after members of the Limerick Township Municipal Authority signed over ownership and operations. A municipal authority was created by the board in 1966 and operated as an independent municipal authority. Township Manager Dan Kerr said at the time such a power transfer would achieve cost savings for Limerick in the long run, though members of the authority disagreed saying it was pure politics at play. One of the members of both the authority and the Board of Supervisors was David Kane, who resigned as a supervisor on Sept. 7, 2008, after accusations of cronyism. He was later convicted of tax evasion-related charges and then sentenced to federal prison.
Eight years after taking control, the township stated another reason for selling the sewer system was because of increasing operational costs and future capital investments that would need to be done to the system. Regulations made by the Pennsylvania Department of Environmental Protection would “begin to place a greater financial and operational burden on the entire department” according to the release. Additionally, capital investments to the current $36 million collection and treatment system would have been required.
The board has toyed with the idea of selling the sewer system in the past, following informal inquiries from companies that run sewer systems, Kerr explained previously. The offers were never high enough for serious consideration, though. This time, however, was different. New legislation out of Harrisburg and the board’s commitment to funding over $22 million in capital improvement projects without raising taxes has changed the situation, he said.
Earlier this spring, the Pennsylvania General Assembly passed Act 12, which allows municipalities to sell sewer systems at market value instead of at a Public Utility Commission evaluation, Kerr said.
“It possibly could add more value to the system,” he said at the time.
In addition, the supervisors were exploring funding options to pay for upcoming public safety capital improvement projects without a tax hike, Kerr said.
The township is gearing up for a new $10.4 million police headquarters and administration building. Design and engineering is wrapping up and construction is slated to begin in early 2017.
Additionally, over the next 15 years, the township has $13million budgeted to renovate the two township volunteer fire company stations and purchase new equipment. Lastmonth, the township broke ground on a Limerick Fire Company fire station. After that, the Linfield Fire Company will undergo a $2.5 million renovation, Kerr said.
Other supervisors’ goals include maintaining the ongoing business strategy that has resulted in the township’s “AAA” bond rating by the Standard and Poor’s organization. This achievement is the highest level recognized by the financial industry and enjoyed by only a handful of communities within Pennsylvania. Also the board looks tomaintain the township’s history of low tax rates, which has consistently been in the lower third of all 62municipalities in Montgomery County.
In the release, Neafcy praised Aqua’s organizational structure, history of customer service, responsiveness and dedication to maintaining a high level system at the lowest cost possible.
“While this decision was not made lightly, we are assured that the residents and rate payers of this community will be well served by Aqua,” he said, “and look forward to having them as part of our wonderful Limerick community.”