Towamencin Municipal Authority.
In May, the Towamencin Township Board of Supervisors will decide whether or not to sell — or, in one bid proposal, lease — its sanitary sewer system to one of five interested bidders, in a move that could mar the relationship between township leaders and thousands of taxpayers.
According to The Reporter Online’s Dan Sokil and Emily Rizzo of WHYY, the first of two town hall sessions held last week on the potential sewer system sale showed an outpouring of hundreds of residents in red shirts opposed to the sewer sale. Many of them were members of the Facebook group Towamencin Neighbors Opposing Privatization Efforts, or NOPE.
Supervisors paid $9,500 to private consultant Public Financial Management to develop a study on whether it was worth it to value and monetize the sewer system, per WHYY.
The township received five bids for the sale or lease of the sewer system: NextEra Energy for $115.3 million, Pennsylvania American Water for $92.4 million, Aqua Pennsylvania for $54.1 million, Franconia Sewer Authority for $23.5 million, and VICO for $45 million or $55 million, which is also the only bidder who wants to lease the system long-term.
NextEra, VICO, and Franconia Sewer Authority are offering a two-year rate freeze. Aqua and Pennsylvania American are the only two of the five regulated by the Public Utility Commission.
Check out the entire bid results presentation here.
According to PBS, 10-year sewer rate estimates ranged from $874 for Aqua to $1,060 for NextEra. The sewer system is estimated to cost between $20 million and $30 million for upgrades over the next five to 10 years, per The Reporter.
Regardless of whether the sanitary sewer system is sold or not, PFM analyst Scott Shearer informed the public that there would be a sewer rate increase in the future.
Shearer told supervisors, per The Reporter, that proceeds can be used to pay off outstanding debt and pensions, increase homestead and farmstead exemptions above the current $50,000 discount, shift current debt service millage to parks and recreation and fire service, and put funds in a reserve account.
At present, any resident using the sanitary sewer system is charged an annual fee of $450, which was increased from $375. Any sale would have no rate increase in the first year but could be as much as $600 in 10 years, per The Reporter.
Towamencin NOPE, which was spearheaded by resident Kofi Osei, is being helped by David McMahon, who started the original NOPE in Norristown, according to WHYY. McMahon and NOPE Norristown were successful in fending off a sale to Aqua, and then McMahon advised Conshohocken NOPE, which also denied Aqua, per the report.
WHYY states that Aqua owns most of the utilities in the Philadelphia suburbs. At present, Aqua is seeking to increase wastewater bills by 33 percent through a rate case petition with the Pennsylvania Public Utility Commission, according to WHYY.
Osei told WHYY the potential sale is bad for democracy and called it “politically expedient money.”
According to The Reporter, during public comment, Osei told supervisors the residents do not want their sewer sold to the highest bidder.
“Since they have not gone out of their way to ask us what we want out of our sewer system, I want to ask everyone here: Who would like to keep municipal control and ownership of your sewer system? Raise your hands,” said Osei, and about 150 people responded.
During the nearly two-hour public comment session, residents spoke up against the sale.
According to The Reporter, resident Ron Hugick said, “These increased costs are going to get passed on to the school district, the businesses in the township, we’re going to see our school taxes go up because of this, maybe someone doesn’t locate in this area. There are some things here that I don’t think you’re being honest with the residents about.”
Resident Bob Gillmer asked PFM if their information was accurate as far as projecting zero tax increases for the township for 10 years, if it were to sell the sewer system. Gillmer calculated a tax increase of 26 percent over current levels beginning in 2023 if the township does not sell, according to The Reporter.
“If those are the projections we’re using, to the supervisors, are we committing to zero tax increases for ten years if we sell?” Gillmer asked.
Towamencin Township Manager Donald Delamater has remained tight-lipped, according to WHYY, over how the township plans to use the sale money, why the township wants to sell, and whether residents’ concerns are being considered in the decision to sell.
At the town hall session, following the presentation, Supervisor Joyce Ferguson Snyder, the sole Democrat on the five-member board, was the only one to ask questions and comment on the situation.
“Why in the world would our township want to sell our house, and then rent it back to us at an increased cost? … No matter what, our rates are going to go up. And we’re losing control of an asset we currently own. I’m not understanding why we would want to give that up,” Snyder said.
Read more in-depth on the situation on the WHYY.org website here. Read more resident comments on The Reporter Online.
See also:
Towamencin Inches Closer To Possible Sewer Privatization With Feb. 11 Bid Deadline
Editorial: Selling the Sewer System Would Be Bad for Towamencin (and Elsewhere)
Lansdale Public Works Committee Prepping for Additional Merck Sewage Flow Beginning Next Year
