Questions abound at East Coventry sewer sale meeting

EAST COVENTRY — For customers, and potential customers, of an expanded sewer collection system, Wednesday was a day for questions.

That was the day two separate two-hour open house sessions were held at the Ridge Fire Company for those who want to know more about Pennsylvania American’s $7 million bid to buy the township’s sewer system.

Whether it’s sold or not, the system, which currently serves about 1,100 customers, will be expanding into the Parker Ford area to service another 385 households, with expansion potential for 70 more.

That expansion, which has been mandated by the Pennsylvania Department of Environmental Protection, comes with a price tag of more than $27 million.

So perhaps it’s no surprise that many of the people who showed up to ask questions live in the Park Ford area of town. Depending on how the financing for the project is arranged, they could end up paying nothing but a regular quarterly sewer fee, or see their sewer charges go from zero to $1,161 per quarter by 2033.

“I’m worried about the cost,” said Ruth Ann Rittenbough, who also noted that many “houses are split” into apartments and she wanted to know how they would be billed.

“I think we should talk to Valley Forge Sewer Authority,” said Robert Meissner, who is not a customer of the system, and would not be when it expands either. “They come up as far as Schuylkill Township and their rate is only $75 per quarter.”

Added Meissner, “This is a company that trades on the stock exchange. Their first priority is to make money and to answer to stockholders. I’m not sure people understand what that will mean once they own the system.”

Linda Ottaviano, who lives on Route 724, wanted to know exactly where the pipe would be laid because if it is more than 150 feet from her home, she does not believe she will be required to hook up to the system. The septic system on her property “works just fine,” she said.

However, although the current township ordinance does not require those who live more than 150 feet from a sewer line to hook up, it is not clear whether that rule will apply if the township sells to Pennsylvania American.

“I’m undecided,” said Bob Townsend, 86, who owns a house in Parker Ford. “There are still so many unanswered questions.”

There were many questions Ben Morris could not answer.

Morris, the senior director of business development, said the map on display Wednesday showing where the sewer lines might run in Parker Ford, is not final. It was drawn up by engineers working for the township. “It certainly looks reasonable,” but if the sale goes through, “we’ll have to take a closer look.”

Many people asked Morris about his company providing public drinking water to Parker Ford as well. Given that some of the failing septic systems in the area are polluting drinking water wells, as well as nearby Pigeon Creek, that is an understandable question, but not one Morris could answer Wednesday.

Kara Rahn, senior manager, of government and external affairs for Pennsylvania American, was able to answer a reporter’s question.

Resident Sam Cantin praised the township’s outreach effort. Already a customer on the sewer system, Cantin said “I received two letters from the township and they had a lot of information about this on their website.”

Cantin said he spent most of his time at a table set up to explain potential rate changes. “It’ll be a jump, that’s for sure.”

East Coventry’s sewage is treated at the treatment plant run by the North Coventry Sewer Authority off Route 724. It currently has a contract with the township, but if Pennsylvania American buys the system, a new contract between the two will have to be drawn up.

Selling the sewer system relieves the township of direct responsibility for the construction of the new sewer collection system in Parker Ford, which would become the responsibility of the buyer.

Pennsylvania American’s bid included a provision to pay for the entire Parker Ford project without making any of the residents there pay any money upfront, saying it has paid for similar projects that way in the past, although the final decision rests with the Pennsylvania Public Utilities Commission.

Should the township elect to continue to own its system, and all customers, including the new Parker Ford customers, collectively pay for the new collection system, sewer rates for all customers would increase by 143 percent — from $185 per quarter to $449 per quarter — by the year 2033, according to township projections.

However, should the township elect to continue to own its system and put the full cost of the Parker Ford project on the 384 new customers alone, existing customers would see their rates increase to $199 per quarter in 2033 — a 7.6 percent increase

Under that scenario, Parker Ford customers would have to pay roughly $70,000 upfront, or a quarterly sewer rate of $1,161 — a 527 percent increase over the current rate of $185 per quarter.

Under the rate projections provided by PA American, rates 10 years from now would rise to $388 per quarter, a 109% increase. The township’s consultant, PFM, also created projections assuming a higher rate increase, which would put the 2033 bill at $542 per quarter — a 193 percent increase over the current rate.

However, the township could choose to ease that impact by putting $2.5 million in a rate-stabilization fund. Should the system be sold to PA American, that money could be used to subsidize sewer customers for another 14 years so that their rates would go up at the same pace as if the township still owned the system, according to the presentation.

Both Aqua and PA American are regulated by the Pennsylvania Utilities Commission, so the companies do not have full control over their rates. About every two years, they ask the PUC for a rate hike based on their expenses, and the PUC spends eight to 12 months investigating the “case,” before issuing the new rate. Most often, the new rate is less than the company requested.

“Certainly, cost has been a concern I’ve heard about a lot,” Township Manager Eugene Briggs, said as the afternoon session wound down and the crowd around his table began to shrink. “People are also asking how soon because their septic systems are failing now.”

According to information on the township website, the board of supervisors could make a decision as soon as Aug. 14.

Once the decision about whether to sell or not is made, getting the Park Ford expansion built and operating “is going to be a very heavy lift,” Briggs said.