Board approves sale of York City wastewater system; now back to council
The York City Sewer Authority Board on Wednesday evening approved the $235 million asset purchase agreement of the city's wastewater treatment system with Pennsylvania American Water.
But the agreement isn't final until the York City Council votes to transfer the responsibilities of owning the system from the authority to the city before the company buying the system files with the Pennsylvania Public Utility Commission to purchase it.
The four-member sewer authority board voted 3-1 in favor of the asset purchase agreement, with Chairperson Phil Briddell voting against it.
"There’s lots of reasons, one of which is that this is a forever situation, and I personally had a tough time with letting go of the local control of the plant operation,” Briddell said. “It was truly a community resource. And I felt that part of it had legitimately not been fully explored.”
Briddell had said Tuesday that it wasn't made clear to the sewer authority board until last week that only York City residents would benefit from a three-year rate increase moratorium in the agreement.
York City Council President Henry Nixon, though, said that he knew that from the beginning because the other municipalities are responsible for setting their own rates. York City solicitor Jason Sabol also emphasized that it was public knowledge.
If York City Council votes to transfer ownership of the system, it would trigger a $20 million upfront payment to the city, which would more than fill the $14 million budget hole officials had anticipated for this fiscal year.
The number was originally reported to be $15 million, but Sabol confirmed Wednesday that the first dollar amount was just the least amount of an advance the city would receive.
Pennsylvania American Water, whose representatives didn't make a presentation at Wednesday's meeting, must apply to the state Public Utility Commission to finalize the sale.
The agency would then conduct a six-month review before reaching a decision.
During that time, the PUC is expected to review a formal complaint that the York Area Regional Sewer Authority said it plans to file.
The authority, composed of Manchester, West Manchester, Spring Garden and York townships, as well as North York borough, has opposed the city's sale plan from the start, saying that privatization will ultimately result in significantly higher user fees. The authority recently criticized the fact that the three-year moratorium on rate hikes only applies to city residents.
Residents from the six other municipalities that use the system — West York uses the system but is not a member of the regional authority — would need to negotiate any relief with Pennsylvania American Water.
"We strongly disagree with your thought process," said Tim James, manager of Manchester Township and member of the regional authority, addressing the city sewer authority board on Wednesday. "If you don't have the right to find a better alternative to lessen the negative impact on the residents of our community, then we don't know who does."
York City Council and Mayor Michael Helfrich have emphasized the importance of the deal for what it would mean for the 2021 city budget, which was drafted to be contingent upon the sale.
Anticipation of the deal being approved prevented a 48% property tax increase and saved 20 jobs.
— Logan Hullinger can be reached at email@example.com or via Twitter at @LoganHullYD.