NV Twp. Considers Sale of Sewer Authority

By T.J. Martin
The Tube City Almanac
November 16, 2023
Posted in: North Versailles Twp. News

The potential sale of the assets of the North Versailles Twp. Sanitary Authority to Aqua Pennsylvania Wastewater Inc. took another step forward earlier this week when the North Versailles Twp. Commissioners voted Wednesday to support the evaluation of the proposed deal.

In a public presentation on the proposed sale during the monthly commissioners meeting on Wednesday night, the board heard from Scott Shearer, managing director of PFM Financial Advisors LLC, which the township and authority hired in June to help assist it with the proposed sale.

Aqua is owned by Essential Utilities of Bryn Mawr, Montgomery County, the parent company of Peoples’ Gas.

Shearer said Aqua Pennsylvania Wastewater Inc. and the authority have signed a letter of intent in which the company will pay between $25 and $30 million for the sewer system, including the pipes and three pumping stations.

According to a written presentation presented by Shearer to the commissioners, the sale would also include “the rights and obligations of the authority’s existing sewer service contracts and intermunicipal agreements” but the township would remain responsible for any future additions to the sewer system, such as to service any new land development. The final valuation of the sale will be determined by the Pennsylvania Public Utility Commission.

No authority employee will lose their job if the sale is approved, Shearer said.

Shearer noted the proposed agreement is between the authority and Aqua Pennsylvania Wastewater Inc. The township will act as a “joinder,” giving their support to the agreement.

The sewage authority will meet Nov. 28 to consider the resolution to sell the system. If they agree to do so, it will take between a year and 18 months to close, Shearer said.

The board and authority had directed PFM Financial Advisors LLC to determine what estimated future sewage rates might be if both the sanitary authority keeps the system and if they agree to the proposed sale.

Based on a number of assumptions regarding financial factors in the future, Shearer said if the authority keeps the system, the average residential bill of $79 per month in 2023 is projected to increase to $100 per month in 2024, then climb by an additional less than $10 per year to $159 per month in 2033.

If the sale is approved, the average rate is estimated to remain at $79 per month through 2026, then climb to $136 per month in 2027 and 2028, $139 per month in 2029 and 2030, $142 per month in 2031 and 2032 and $145 in 2033. The estimate notes that, if the sale to Aqua Pennsylvania Wastewater Inc. is approved, any sewage rate increase would need the approval of the Pennsylvania Public Utility Commission.

“Whether the system’s sold or whether it’s kept, rates are going to be going up,” Shearer said.

After two Aqua Pennsylvania Wastewater Inc. executives addressed the board about the company, Marc A. Lucca, president of the company, told the board, “Your system’s in trouble. Your system is in need of repair.”

Wastewater systems require investment, he said, adding, “It’s not just, ‘Flush it and it goes away.’”

He said talking about rates was important but that he hopes the decision of the board isn’t based solely on rates.

“You cannot have a thriving community without a water and wastewater system, “ Lucca said.

The board voted 6-1 to “to support the evaulation (by the sewage authority) of a potential sale.”

Commissioner Russell Saula voted against the resolution.

“I think down the road it’s going to cost a lot of money,” Saula said after the meeting. “I believe (the rates) are going to skyrocket.”

Originally published November 16, 2023.

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