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Peoples Gas parent company to pay $25M to $30M for pipes, pumping stations
The North Versailles Twp. Sanitary Authority voted 5-0 to approve an asset purchase agreement with Aqua Pennsylvania Wastewater Inc. after three of the company’s executives told the authority board members about their company and the purchase agreement as they did earlier in November when they met with the township commissioners.
Scott Shearer, managing director of PFM Financial Advisors LLC, said his company was hired by the township in June to help with the sale. He said under the agreement, Aqua will pay between $25 million and $30 million for the township sewer system, including the pipes and three pumping stations.
Aqua is owned by Essential Utilities Inc. of Bryn Mawr, Montgomery County, the parent company of Peoples’ Gas. The company operates in nine states with more than 3,100 employees and under the agreement, all of the sanitary authority’s employees will be offered employment with Aqua.
To take effect, the agreement will need the approval of the Pennsylvania Public Utility Commission. Shearer said it will take four to six months to get the proposed agreement to the PUC and it’s hoped the transaction will close around the end of 2024.
If the agreement is approved by the PUC, sewage rates will remain the same until 2027. Then, sewer rates are projected to rise to between $103 and $113 per month, with any increase needing the approval of the PUC. If North Versailles were to keep the system, the monthly rate is estimated to be $120 per month in 2027, according to Aqua.
Billing will change from quarterly to monthly, Marc A. Lucca, president of the company, told the authority board. Customers will no longer be able to pay their bill in person at the authority office but will be able to pay online and can also access an Aqua-owned U.S.-based customer service call center with any questions.
In addition to the purchase price, Aqua plans to spend at least $7 million over the next 10 years on the North Versailles system, primarily to replace pipes, according to Tom Rafferty, director of municipal partnerships for Aqua.
Authority board member Romodore Abdullah asked why the system was being sold.
Township Commissioner Sam Juliano, who was one of three township commissioners along with the commissioner-elect who attended the meeting, said he sees what’s ahead for wastewater systems in terms of increased federal regulations.
“I’m looking at this as a good financial decision,” Juliano said.
Township resident John Cheripko asked the authority board during the earlier citizen’s comments portion of the meeting to address the board after they heard from Aqua and his request was granted.
“I would personally rather see (rate decisions) kept 100 percent within the community,” Cheripko said.
Lucca said the township sewer system is getting older and next year will be worth less than now.
Cheripko said that $2 million to $3 million in sewage fees will be “leaving the township” every year.
“We could do the upgrades ourselves,” he said. “Who’s going to be more responsible with our capital?”
Shearer noted that since the borough’s wastewater is treated by the Allegheny County Sanitary Authority, some decisions affecting residents’ sewage rates are already being made outside of North Versailles.
NVTSA Board Chairman Frank Pearsol expressed agitation when he said he wasn’t made aware until the day before Thanksgiving that the vote whether to approve the purchase agreement would be held at that meeting.
“I won’t stand in the way of what the elected officials want to do,” Pearsol said. “The commissioners are the only ones that can sell it.”
Authority board member Jim Turbuk was absent from the meeting.
Shearer said with the approval, Aqua and the NVTSA are now in the early to middle stages — if it were a baseball game, it would be the “third or fourth inning,” he said — of the purchase process.*
T.J. Martin is a freelance writer from Trafford whose work has also appeared in the Pittsburgh Post-Gazette and Irwin Standard Observer.
*CORRECTION: Due to an editing error, this quote was incorrect. We apologize for the mistake.
Originally published December 05, 2023.