Towamencin Municipal Authority.
Unless the public can change the minds of at least two Republican Towamencin Township Supervisors in the next two weeks, a big-time corporation will soon own a small-town sewer system.
On May 25, supervisors will vote on whether to sell its sewer system and its amenities to NextEra Water, a subsidiary of NextEra Energy, for $115.3 million. Supervisors voted 4-1 Wednesday night to advertise the sale of the sewer system.
Supervisor Joyce Snyder, the sole Democrat on the five-member board, was the dissenting vote. The meeting took place at Dock Mennonite Academy on Forty Foot Road.
Last month, at a second town hall session with residents, the four Republican supervisors – Chairman Chuck Wilson, Vice Chairman Rich Marino, treasurer Kristin Warner, and secretary Laura Smith – made their intentions known that they are selling the sewer system.
“Our next meeting … would be the next time this is discussed and voted upon. There will at some point be a meeting of the Towamencin Municipal Authority to consider the sale as well,” Wilson said Wednesday night.
“This is a complex decision, and the board felt it was our fiduciary responsibility to the residents and rate payers of the township to evaluate if the sale of the sewer system assets makes sense to the township financially,” he said.
Residents, including those of the 539-member strong Facebook group Towamencin Neighbors Opposing Privatization Efforts (NOPE), continue to be vehemently opposed to the sale, and about 12 of them took the podium during public comment to voice their concerns over future rate hikes from the private entity and poor customer service. You can watch the meeting on the Towamencin Township website here.
Kofi Osei, of Cambridge Way, who also spearheaded the creation of Towamencin NOPE, said he will do one more thing to try and stop the sale – he will organize the creation of a Home Rule Charter. He said this will be the second time in his lifetime that the board of supervisors had to make an incredibly unpopular decision that was a huge detriment to the township residents, referencing the “Bridge to Nowhere” over Forty Foot Road.
“I’m going to share one of the things I’m going to do to try and stop this. You guys were careful to cart out (solicitor) Jack Dooley to say there isn’t any referendum for the sewer sale, but we are allowed by state law to have a referendum to rewrite this township’s charter,” Osei said. “So, if you enjoy how you run this government right now, I would suggest selling to Franconia -- there is no bidder listed on the agenda – but if not, I will begin organizing to write a Home Rule Charter for Towamencin.”
A home rule charter is like a local constitution. All counties and municipalities in Pennsylvania can create and adopt a home rule charter, which gives governments the ability to self-govern. Home rule municipalities can set property and personal tax rates, and develop ordinances rooted in local needs and not by the state legislature. Home rule municipalities can do anything not denied by the General Assembly, and do not have to be run by state laws. There is almost no oversight from the state, but any change to a charter requires a referendum on a ballot.
To adopt home rule, citizens must vote to create a government study commission, and elect members of the commission. This commission will analyze the current government and make a recommendation. If the recommendation is approved, then the commission writes the home rule charter. The charter must be adopted by a majority vote in a referendum.
Township supervisors plan to use the interest from the sale to pay for a number of future township improvements.
One major benefit: The Homestead Exemption can increase to $76,000, which equates to an additional $139 in tax savings for eligible property owners. Commercial properties and properties that are not the primary residence of the taxpayer are ineligible for Homestead Exemption.
Along with $5 million in-hand, the township will have $120.3 million in its coffers after the sale. Once it pays off $19 million in sewer and other debt, funds $7.5 million in pensions and post-employment benefits, pays $1.8 million in fees and uses $5 million to jump-start projects, the township will have $87 million in reserves, of which it intends to use the interest earnings to fund future projects.
Of that $87 million, the township can establish reserves to fund projects for township facilities and major equipment purchases at $15 million, fund fire services, infrastructure and equipment at $10 million, fund parks and open space for $20 million, apply $20 million for stormwater upgrades, and apply $22 million to transportation projects.
Open space funds are expected to go toward land acquisitions, $50,000 for annual TYA baseball field improvements, and $50,000 a year for community pool infrastructure.
Stormwater upgrades include funding the township’s share of the Skippack Creek Alliance Pollution Reduction Plan, completing a 10-year strategic stormwater management plan, and replacement of 150,000 linear feet of corrugated storm water pipe.
Fire service funding can go toward the main fire station replacement and upgrades, and pumper and rescue truck replacements.
Transportation funding, generated by $660,000 in interest per year alone, includes planned intersection improvements at Welsh and Orvilla roads, and the Valley Forge Road, Troxel Road, and Kriebel Road intersections along Sumneytown Pike.
NextEra’s offer was $23 million more than the next highest bidder PA American Water. NextEra Water President Bruce Hauk told the public at last month’s second town hall session that NextEra does not expect to recover the full amount of the proposed purchase price. According to its bid, NextEra anticipated that “the fair market value appraisals will be lower than our proposed purchase price, and therefore, future rates would not reflect a return on or of the full purchase price.”
The NextEra deal comes with a two-year rate freeze. Indicative rates for the next 10 years, based on a monthly billing cycle, range from $37.50 in Year One, to $88.40 in Year 10. Indicative rates for the next 10 years, annualized, range from $450.00 in Year One to $1,060.80 in Year 10. By 2025, rates could jump to $653.64 at the face amount, and township ratepayers could be shelling out as much as $1,036 by 2027.
However, NextEra cannot guarantee rates, as those are done at the discretion of the Public Utilities Commission. And it is that agency where NOPE will take its fight next.
“This does not mean this is over. Far from it,” wrote resident Jenn Richman Foster on the Citizens for the Revitalization of Towamencin Facebook group. “Even if we can’t convince these supervisors to listen to their constituents, this still has to get through the PUC. This is where our fight will pick up … Decisions like this have consequences, and the first will be our petition with the PUC, and the next will be at the ballot box.”
According to the purchase proposal, 14 current wastewater treatment plant employees would be offered employment with NextEra Energy. Those working for the township that serve in the collection system will be “re-deployed” to other maintenance projects in the township, like streets or park maintenance. However, a US Water employee will be placed in a managerial role in Towamencin.
The next meeting is May 25 at 7 p.m. at Walton Farm Elementary School.
See also:
Letter to the Editor: Vote No on Selling Sewer System
Residents Speak Out After Towamencin Supervisors Signal Intent to Sell Sewer System
Towamencin Supervisor Majority Says They’re in Favor of Selling Sewer System Despite Opposition
North Penn Says Proposed Towamencin Sewer Sale Would Have Minimal Impact on District
To Sell or Not to Sell: Towamencin Board to Decide Sanitary Sewer Fate in May
Towamencin Inches Closer To Possible Sewer Privatization With Feb. 11 Bid Deadline
Editorial: Selling the Sewer System Would Be Bad for Towamencin (and Elsewhere)
