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Date: 4/4/2023
WARE — The town is looking to solve water and sewer problems with the sale of its water and wastewater assets, and has begun looking for a private utility to assume management of these systems.
The town has already issued a “request for proposal ... to sell the assets to a reputable utility presently regulated by the Massachusetts Department of Public Utilities to consider,” according to a press release issued by the town on March 17.
Reasons for sale
The major impetus behind this initiative is to unburden the town financially of water and sewer costs, along with greatly improving the safety, reliability, and reducing the cost to residents and businesses for water and sewer services. “It is expected Ware residents will receive a greater level of service at a more reasonable price than the town could provide on its own,” the release states.
Simply put, the town cannot keep up with the financial demands of continuing its present state of operations, due largely in part to new, stricter permit issued to the town as part of the National Pollutant Discharge Elimination System as of February of this year. This would require capital investments to address the extensive iron and manganese quality issues that have “plagued the town’s potable water system,” the release stated. Additionally, the money required to comply with the new permit’s stipulations on discharge limits into the Ware River is too steep for the town’s current financial standing.
A Tighe & Bond rate study from November 2021 found “the required improvements will have a significant impact on the rates the town will be required to charge to meet new debt obligations to fund the improvements and subsequent operational expenses.” This means that cost to residents may see an increase to account for the additional money needed for the town to keep managing its own sewer and water services and treatment. The town also states that it “doesn’t have the financial capacity or possess the engineering/technical expertise internally to complete the required improvements, nor can it do so unilaterally at a cost effective price.”
In light of the hardship financially to maintain town-run sewer and water for the new permit requirements and the town’s inability to fund this, the release stated that it is advantageous to all to seek a private utility to take over. The town would receive money from the sale of the assets, which Town Manager Stuart Beckley said would be determined for best use in the future.
Beckley explained that the intention is also that town water and sewer employees become employees of the company. “It is very important to the town that any proposal fully explain how the employees will be employed, paid and benefited,” Beckley said.
Rate increases
If a private utility were to take over, there are procedures in place to ensure rates do not rise astronomically or change significantly. According to Beckley, the company that took over would have to file a case with the DPU to increase rates. Beckley said, “The DPU will be responsible to regulate the rates. If the town moves forward with a private utility, the proposed rates would be part of the proposal and negotiations before a purchase is finalized.” That is to say, the rates would be set before the town committed to transfer of services to the company. Beckley also said the charges for sewer usage are based on the water usage over a given period of time.
Next steps
Now that the RFP has been issued to solicit bids from a private utility, there are several steps to follow to complete the whole process.
According to the release, the town must obtain an “appraisal of property assets to ensure a fair value price is obtained in the transaction.” All responses to the issued RFP are due on May 18, which the town will review and consider and based on this the Selectboard will make a recommendation.
Then, the Selectboard will create a warrant for the proposed transaction, which is to be voted on at a Special Town Meeting. The release states that this meeting may take place later in the summer. Prior to the meeting, the results of the appraisal will be made public.
A public information session, hosted by the selected utility to share information and provide answers to any questions, will take place so that residents have a complete understanding of all aspects of this transition prior to a Town Meeting. The full RFP and press release can be found at townofware.com.