Today the Guardian had a long piece about the circumstances around the potential sale of the Chester Water Authority to Aqua. Chester Water Authority serves Garden City and areas mostly west of here out into Chester County. There’s a number of nice photos included in the article, and its worth a read. It does a good job of explaining how changes in state law brought us to this point.
In 2016, Pennsylvania became the first state to pass legislation that allows private companies to buy public utilities for more than they are worth – relying on what’s known as fair market value rather than depreciated value. Companies can recoup the over-priced investments by passing on the cost to all their customers through statewide rate hikes, meaning residents pay while shareholders reap the rewards.
This really is a crazy system. The law allows companies to purchase public utilities at inflated prices, which they then recoup by overcharging their new customers in the future. So we, the ratepayers, will end up paying Aqua to allow them to acquire our public assets.
With more than a dozen pending lawsuits, the case could be tied up in court for years. If sold, it would be up to the court to determine the city’s share of the proceed.
So we’ll likely be hearing about this sale for years to come. Its hard to think anyone but the lawyers is winning because of this state law.