Aqua's proposed rate increase for New Garden customers suspended for 7 months10/19/2021 07:46PM ● By Richard Gaw
By Richard L. Gaw
On Aug. 20, Aqua Pennsylvania Wastewater, Inc. (Aqua) released a statement proclaiming that they had filed an application with the Pennsylvania Public Utility Commission (PUC) requesting to increase water and sewer bills for their customers that if approved would jack up monthly rates for its customers in New Garden Township well into the double figures, beginning in 2022.
By the next day, the offices of New Garden Township were flooded with questions and opposition about the proposed rate hike, but township officials told residents that the proposal is just that – a request for increase, one that first needed to be reviewed and approved by the PUC before it would go into effect.
In a letter posted by the township on its website on Sept. 17, officials assured residents that “typically, the PUC does not grant the full amount of an increase sought by a public utility.”
True to form – and by a vote of 3-0 – the PUC recently voted to suspend Aqua's proposed water and wastewater rate increases for a period of seven months, in order to first investigate the utility company's annual revenue and rate increase requests. The project will be assigned to the Office of Administrative Law Judge for evidentiary hearings and the issuance of recommended decisions or settlements.
Translated, those township residents who tap into the wastewater systems now owned by Aqua will not see any rate increase at least until May 2022.
From the time the PUC approved New Garden Township's sale of its wastewater system to Aqua on Dec. 20, 2020 for $29.5 million, the threat of a rate increase for New Garden customers using what is now Aqua systems has been on the front burner of discussion and anticipation, but it has been the size of the proposed increase that has angered residents.
Aqua is proposing to increase its annual operating revenues for water services by approximately $86.1 million – a revenue growth of nearly 17 percent, and is seeking another increase in its annual operating revenues for wastewater services by $11.5 million – or 31.2 percent. If rates are approved by the PUC, that would tack an additional $97.6 million – an increase of 17.8 percent – onto the utility company's revenue.
Under the proposals, the average monthly bill for a residential water customer using 4,000 gallons per month would increase by $11.97 (17.3 percent), from $69.35 to $81.32, and the average monthly bill for a residential wastewater customer would increase $18.44 (33.2 percent) from $55.51 to $73.95.
Aqua seeking to recover $1.1 billion in improvements
In their statement explaining their reasons for the proposed rate hikes, Aqua said the company is seeking to recover the $1.1 billion it spent to upgrade its “distribution and wastewater systems, improving drinking water quality and service reliability throughout its water and wastewater operations.”
Currently, the company provides water service to approximately 434,264 customers in portions of more than 200 municipalities throughout 32 Pennsylvania counties, and wastewater service to approximately 40,284 customers in portions of more than 40 municipalities throughout 15 Pennsylvania counties. Collectively, the two companies serve nearly 1.5 million people throughout the Commonwealth.
The statement also stated that a significant portion of Aqua’s capital program has been dedicated to upgrading and rehabilitating treatment plants and wells, including the installation of equipment to meet new, more stringent water quality requirements for increased sustained disinfection. Improvements to wastewater operations include collection system replacement and renewal, treatment plant rehabilitation to ensure reliable operation and that high-quality treated water is returned to the environment, upgrades to electrical systems, and the installation of generators to ensure continued service during power outages.
Beginning in 2016, the company has spent $295 million to purchase eight public utilities throughout southeastern Pennsylvania, which in addition to New Garden include Cheltenham, East Bradford, East Norriton, East Whiteland, Limerick, Lower Makefield and Willistown, and is currently in negotiations to purchase the DELCORA wastewater system in Delaware and Chester counties for $277 million – as well as proposed to purchase the Chester Water Authority for $410 million.
The township is undergoing measures to let PUC officials know the degree of disapproval coming from its residents. At their Sept. 20 meeting, the supervisors voted 5-0 to agree to submit a letter to the PUC stating their opposition to Aqua’s proposed rate increase, and to the Chester Water Authority offering its support against Aqua’s proposed purchase of the utility company.
The township's letter to the PUC, signed by township solicitor Vince Pompo, requests a public meeting at the Township Building between PUC officials and New Garden residents who are opposed to these proposed rate hikes. Attorney William Christman said at the board's Oct. 18 meeting that the PUC has not responded to the request.
Other township news
In related news, the supervisors unanimously approved an ordinance that amended several components applicable to the sale of its wastewater system to Aqua that provide regulations for sewer sludge; the installation, use and maintenance of private sewage pump stations; tapping fees; subdivision and land development; and zoning.
The board gave approval to a proposal by Page Excavating Company in the amount of $6,835 that will improve drainage capability at the intersection of Mercer Mill and Penn Green roads in the Village of Landenberg, an area that has experienced serious flooding during heavy rains.
The board also authorized the use of the township's open space funds to purchase an eight-acre property along Penn Green Road in Landenberg for $575,000, and extend the date of its closing to Dec. 31, 2021.
The board also gave their approval for the township to spend $17,460 to make repairs to the roof, plumbing and oil tank of an historic home located in the Saint Anthony's in the Hills property, that the township now owns. The cost of these repairs will come from a fund created by the township early in 2020 in the amount of $150,000 in order to pay for expenditures related to the township's long-term plans to develop the site as a center of preservation, recreation and community activity.
The township's annual resident satisfaction survey is now available on its website and is available for comments through the end of November. In addition, the township's quarterly online newsletter is available at www.newgarden.org.
To contact Staff Writer Richard L. Gaw, email [email protected].