Commonwealth Court dismisses appeal against BASA sale
Pennsylvania Commonwealth Court dismissed an appeal Thursday, Sept. 26, against the sale of the Butler Area Sewer Authority to Pennsylvania American Water filed by Center and Summit townships.
The townships filed the appeal in December after the Pennsylvania Public Utility Commission approved the sale in November.
Commonwealth Court Judge Ellen Ceisler wrote in the memorandum opinion that Center and Summit townships had reached an agreement in August 2023, saying that they would not contest the sale, which factored into the court’s dismissal. Additionally, neither Center nor Summit filed written objections to the settlement agreement by the Aug. 21, 2023 deadline.
The water company and the City of Butler filed motions against the appeal, after the townships made their move against the sale.
Jim Lokhaiser, Butler Township commissioners chairman, said Thursday that township administrators were confident that the appeal would not stop the $230 million sale of the sewer authority.
“Hopefully everything moves forward now from here,” Lokhaiser said. “We have been very patient with this waiting for the outcome.”
The dismissal of the appeal is a complicated matter, according to Michael Gallagher, solicitor for Center and Summit. Gallagher said that while Commonwealth Court is dismissing the appeal because it came too late in the sale process, there was not a proper opportunity prior to the sale’s approval to contest it. He said the dismissal is based on procedure more than the actual content of the appeal.
Additionally, the court summary said the appeal could have been filed directly after a court decision on a similar case, Cicero v. Pennsylvania Public Utility Commission. That decision was issued July 31, 2023.
“The Commonwealth Court held that the township should have filed objections before the PUC made its decision,” Gallagher said. “They’re saying we should have filed objections, but at that point, you really couldn’t file objections, because the Administrative Law Judge had made the recommendation that the sale be set aside.”
Lokhaiser said the Butler Township commissioners will be in touch with Obermayer Rebmann Maxwell & Hippel, a Philadelphia-based law group which has been representing the township, city and BASA in the case.
Gallagher said it will be up to Center and Summit supervisors if they choose to proceed with their objections to the sale. One option, Gallagher said, is the townships could apply to have the Pennsylvania Supreme Court hear the case.
BASA provides sewer service to about 15,000 customers in a 32.5-square-mile area that includes the city of Butler, Butler and Center townships, East Butler, and parts of Connoquenessing, Oakland, Summit and Penn townships.
As per the terms of the sale agreement, Butler and Butler Township will split the $230 million equally, after the payments of debts and liabilities relating to BASA. Center and Summit township supervisors said they were appealing the sale because customers outside the two municipalities which own the authority, won’t see any benefit from the sale’s revenue.
Butler Mayor Bob Dandoy said the revenue from the sale will make a “very dramatic” impact on Butler, but officials still have work to do to close on the sale with Pennsylvania American Water.
“We’re pleased, obviously, we’re happy the commonwealth court saw it the way they did,” he said. “We’re happy that we’re able to move forward now ... it’s going to take some time to get everything together.”
In August, Butler and Butler Township each voted to “acknowledge” that BASA would waive its right to terminate its sale agreement with Pennsylvania American Water for 60 days after Pennsylvania Commonwealth Court rules on an appeal against the sale.
According to the settlement, Pennsylvania American Water can increase wastewater rates by up to 1.4 times the current rate a year after closing the sale, or on Jan. 1, 2025 and only recoup $228 million through customer rates.
