New sale terms included in BASA settlement
A settlement agreement reached in Pennsylvania American Water’s pending purchase of Butler Area Sewer Authority will allow wastewater rates to increase by as much as 1.4 times the current rate in the year after closing the sale or Jan. 1, 2025.
The joint petition, revealed Monday, Aug. 14, involves BASA, the city of Butler and Butler, Center and Summit townships; the water company; the state offices of Consumer Advocate, Small Business Advocate and the Bureau of Investigation and Enforcement of the Pennsylvania Public Utility Commission.
The settlement agreement was unanimously approved by all parties involved in the sale.
The water company and BASA amended the purchase agreement to adjust the purchase price to $230 million from the initial $231.5 million. As part of the settlement agreement, the water company can recoup only $228 million through customer rates.
The purchase of BASA by Pennsylvania American Water still is under review by the Public Utility Commission. The administrative law judge still has to consider the settlement and then issue a recommendation to the commission for its final decision on the sale.
As part of the agreement, Pennsylvania American Water will contribute $3.5 million, or $700,000 annually over five years, to the company’s statewide hardship grant program which helps low-income families pay overdue water and wastewater bills in emergencies. The company also will increase eligibility for hardship grants from 200% to 250% of Federal Poverty Income Guidelines.
The water company also will introduce a formal program for payment arrangements for commercial customers, which used to only be available to residential customers.
