Perhaps there hasn’t been this much drama surrounding water since the Titanic.
The tension surrounding a possible sale of the Chester Water Authority (CWA) continued earlier this month at the November CWA board meeting at Neumann University.
After expressing disappointment during an earlier meeting about heavily redacted documents from the Pennsylvania Department of Community and Economic Development (DCED) between Aqua America and Chester’s Act 47 consultant about a possible acquisition, the board uncorked new redacted documents that show the CWA sale had been discussed for months.
CWA Solicitor Francis Catania received board approval earlier this month to take legal action against DCED, forcing it to provide an un-redacted copy of the requested materials.
“It’s very revealing,” he said of the new documents. “It took us 90 days and a lot of effort to get it, but the truth is slowly coming out. We never believed this just happened without planning. We don’t have the full truth uncovered, but we will keep pursuing it.”
On a projection screen in a small gym, Catania detailed the newly available information which includes emails between Aqua’s Executive Vice President of Strategy and Corporate Development Dan Schuller and Act 47 consultant Dan Connelly which took place between April 24-26.
The April 24th email from Schuller to Connelly with Aqua President Marc Lucca copied, says in part, “…we enjoyed meeting with you and your colleagues today and look forward to continuing the dialogue. Your insights on Chester really helped us understand the dynamics of the City.” Schuller closes the email by asking for the city’s outstanding debt balance.
Connelly responds on April 25th that the city’s outstanding debt balance entering the year was $18,929,027. He continues by saying the city is in the process of executing a borrowing of about $20 million to fund much of the past obligations and in addition to their debt liability, the city’s unfunded pension liability is $61,239,939.
“We are interested in the discussions that are taking place regarding the Chester Water Authority and would like to be helpful where appropriate,” Connelly states in the email.
“The first time the CWA board found out the proposal from Aqua was in May,” Catania pointed out. “We don’t know if this is the first involvement but this is the first evidence we have found that specifically indicates their involvement.”
No one from the City of Chester or the CWA is copied on the emails.
A letter from Adam L. Santucci, Esq., of McNees, Wallace & Nurick, (Chester Act 47 consultant) to Kenneth Schuster, Esq, Chester City solicitor, dated May 23rd, five days after the CWA unanimously rejected a $250 million unsolicited acquisition offer from Aqua America, recommended two attorneys that “may be able to help with the proposed acquisition of the Chester Water Authority” and stated “we will be happy to participate in the discussion.”
“We have two consultants – Connelly and Santucci – discussing with a for-profit company the possibility of acquiring our assets,” said Catania. “The letter is evidence of what (Mayor Thaddeus) Kirkland said; how the city never raised this issue. It was raised by Aqua and DCED.”
The four actions the letter recommends the city should take immediately were: formally put CWA on notice of the city’s intention to play a role in ongoing evaluation of the potential sale of the authority’s assets; assemble a team of city representatives to work with CWA in the process of that evaluation (Steve Mullin agreed to be the point person for the Recovery Team); schedule a meeting with the city’s appointed CWA board members; consider hiring an engineer to help value the city’s portion of the CWA’s assets.
Catania noted the City of Chester did not hire the lawyers the letter recommended.
Perhaps every aquatic drama has to involve an iceberg since board member Joe McGinn made reference to one by asking what is happening below the surface that still keeps the Aqua deal in play.
“Why is Aqua actively soliciting state municipalities to reconsider their resolution and running full-page ads about rates? “Why is everyone that is involved with it, acts like this deal fell from the sky?” McGinn questioned.
Public opinion before and after the meeting was against a possible sale.
“We don’t want to see our rates triple. CWA is iconic and it needs to be left alone. The ratepayers and all the municipalities in this area do not want Aqua in here. Everybody involved would be happy if it stayed CWA,” said Ron Navin, one of several CWA employees who stood outside with signs admonishing the possible sale.
“Don’t sit here and mess up a great company. Anybody who decides that they want to let the CWA go is going to have a fight with me. I’m coming to let you know that if you don’t follow the mission in what it states to the ratepayers we are going to have a problem,” said CWA employee Bill Barber during public comment.
Responses to the Right to Know Request and full emails can be viewed at http://www.chesterwater.com/cwasale.html.
