HARRISBURG, Dec. 14 – The PA House Consumer Protection, Technology and Utilities Committee heard testimony Wednesday about legislation that would impose more stringent requirements for the acquisition of municipal water and wastewater systems and bring more transparency to that process, Majority Chairman Rob Matzie announced.
Matzie, D-Beaver, and several colleagues introduced the bill package to reform Act 12 – which was enacted in 2016 to change the way water and wastewater systems are valued for acquisition – to bring greater scrutiny and openness to these transactions.
“Act 12 was originally created to give public utilities incentives to acquire failing or stressed municipal systems that could no longer provide safe, reliable service to customers, Matzie said. “Unfortunately, that’s not how the act is being used. Instead, municipalities and municipal authorities are exercising the provisions to sell healthy, well-operated systems at amounts much higher than their present value. Consumers end up footing the bill for those purchases through hugely inflated rates – without any improvement to services.
“Even worse, the sales often happen with little notice to taxpayers or ratepayers, so the public is left in the dark about a pending sale until it’s too late. Our bill package would add needed guiderails to the act so that it would continue to allow for acquisition of struggling utilities but would better protect consumers from the sale of healthy systems.”
Matzie said that among other things, the legislation would:
- Place purchase price limits on the acquisition of healthy systems.
- Ease the burden on ratepayers by spreading out future rate increases.
- Give the Public Utility Commission the necessary time to review these sales.
- Add strict public notification requirements on both buyers and sellers.
Matzie introduced the legislation together with state Reps. Lisa Borowski, Carol Kazeem, Leanne Krueger, and Jennifer O’Mara, all D-Delaware; Liz Hanbidge, D-Montgomery; and Christina Sappey, D-Chester.
