Public water utilities say Pa. Senate bill will force up rates

The Associated Press

HARRISBURG — Legislation criticized by opponents as a vehicle for for-profit water companies to take over municipal water authorities in Pennsylvania by imposing expensive regulations on them passed the Republican-controlled state Senate on Tuesday.

Opponents also warned that the bill will precipitate ratepayer increases when water authorities must meet the new regulations or after they are forced to sell out to for-profit water companies.

York City recently sold its wastewater treatment system to Pennsylvania American Water for $235.3 million. As part of the state Public Utility Commission’s approval, the company will adopt the existing wastewater rates for three years and will continue billing customers on a monthly basis.

Over the next five years, Pennsylvania American Water plans to invest approximately $17.5 million in York City wastewater system improvements, according to the company. That includes control system upgrades and wastewater main rehabilitation projects.

The City of York's wastewater treatment plant.
Tuesday, August 25, 2020
John A. Pavoncello photo

The York City system serves 45,000 customer connections, including some 14,000 customers in the city and several neighboring communities. With the acquisition of the York City system, Pennsylvania American Water will be the wastewater service provider for more than 220,000 customers across the state.

The bill passed, 27-23, with the backing of Senate Republican leadership. Opposition crossed party lines. The sponsor, Sen. Pat Stefano, R-Fayette, said the bill will create “uniform safety, security and quality standards for all water and wastewater suppliers.”

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The bill goes to the House.

Under it, water systems must submit asset management plans to state regulators for approval within a year-and-a-half. The plans are designed to determine when equipment must be upgraded and must include a cybersecurity program that is developed by an accredited professional.

During floor debate, one opponent, Sen. John Kean, D-Delaware, said the bill will make it easier for major water companies — Pennsylvania subsidiaries of Aqua America and American Water backed the bill — to take over municipal water companies, against the interests of rate payers.

The Pennsylvania Municipal Authorities Association wrote to senators in April, saying its members worry about a "significant increase in rates to the consumer.”

Because of the financial burden, “this could force low-income communities to sell their rights to clean and reasonably priced water to private industry,” the association wrote.

In a statement, Pennsylvania American Water said the bill requires water and wastewater systems to adopt standard industry practices that benefit customers and taxpayers. Aqua Pennsylvania said the legislation improves water quality and makes utilities more accountable to their customers.

— The York Dispatch contributed to this report.