For the past couple of years the city of Nashua has been trying to take over Pennichuck Corporation, the local water company. It began when Pennichuck began merger talks with Philadelphia Suburban, a large publicly traded water utility. Mayor Bernie Streeter stepped in to disrupt the the negotiations and intitiate a referendum on the need to maintain local control.
City leaders want to acquire three subsidiaries of Pennichuck Corp. - Pennichuck Water Works, Pennichuck East Utility, and the Pittsfield Aqueduct Co. - and then hand them over to the Merrimack Valley Regional Water District to manage.
Pennichuck has been fighting back in the courts which so far have refused to rule on the case, saying it is an issue for the PUC.
The court ruled that if "the City forces the company through a lengthy and expensive proceeding before the PUC only to abandon acquisition efforts at or near the end of that process, Pennichuck may sustain future damages that dwarf (the $6 million) which it claims have incurred to date." The court determined that it was too soon to determine whether this would occur, and therefore ruled that Pennichuck's case was not yet ripe for consideration by the court.
Here in this era of privatization and smaller government, we have a local power grab. I can see no benefit to the city taking over a water company, and there had been no talk of it and no complaints regarding service until the company entered into negotiations to merge with Philadelphia. The mayor's worried about the loss of local control and now is trying to fabricate a case that the city could manage the water services at a lower cost.
One of the main advantages to a takeover of the private company would be lower increases in water rates in the future, according to the city’s consultants.
Engineering consultant George Sansoucy said he’s projecting water rates with Pennichuck Corp., through 2015, would increase 77 percent, while under city ownership, the increase would be about half that figure.
Pennichuck CEO Don Correll, however, said those projections are just speculation.
Meanwhile the city is contemplating privatization of trash collection. Of the benefits:
BFI would like to take over the Four Hills Landfill on West Hollis Street, probably through a purchase or long-term leasing agreement.
The company would then run the facility for the city, pick up all residential trash and recyclables and import trash to generate revenue, Neura said. This would enable the city to eliminate a $4.5 million deficit the landfill is running at now while receiving $12 a ton in royalties from trash that is hauled in from outside communities, he said.
But they think they can run a water company. Sure.
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