Pennsylvania American Water Completes Acquisition of the Butler Area Sewer Authority Wastewater System
Pennsylvania American Water has completed the $230 million acquisition of the Butler Area Sewer Authority (BASA) wastewater system. The system serves over 15,000 customer connections across 32.5 square miles in Butler County. The company plans to invest more than $75 million over five years to upgrade the infrastructure, including pump stations, electrical safety, and treatment procedures. The deal will eliminate BASA's $49 million debt and liabilities. Current wastewater rates will be maintained for at least one year, after which customers will transition from flat rate to usage-based billing. The company will also increase its hardship grant program by $3.5 million over five years and extend payment arrangements to commercial customers.
Pennsylvania American Water ha completato l'acquisizione del sistema fognario Butler Area Sewer Authority (BASA) per un valore di 230 milioni di dollari. Il sistema serve oltre 15.000 collegamenti per clienti su una superficie di 32,5 miglia quadrate nella Contea di Butler. L'azienda prevede di investire oltre 75 milioni di dollari nei prossimi cinque anni per aggiornare le infrastrutture, inclusi i punti di pompaggio, la sicurezza elettrica e le procedure di trattamento. L'affare eliminerà il debito e le passività di BASA pari a 49 milioni di dollari. Le attuali tariffe per le acque reflue saranno mantenute per almeno un anno, dopodiché i clienti passeranno da una tariffa fissa a una basata sul consumo. L'azienda aumenterà anche il suo programma di sovvenzioni per difficoltà economiche di 3,5 milioni di dollari nei prossimi cinque anni e estenderà gli accordi di pagamento ai clienti commerciali.
Pennsylvania American Water ha completado la adquisición del sistema de aguas residuales Butler Area Sewer Authority (BASA) por un valor de 230 millones de dólares. El sistema atiende a más de 15,000 conexiones de clientes en un área de 32.5 millas cuadradas en el Condado de Butler. La empresa planea invertir más de 75 millones de dólares en los próximos cinco años para mejorar la infraestructura, incluyendo estaciones de bombeo, seguridad eléctrica y procedimientos de tratamiento. El acuerdo eliminará la deuda y responsabilidades de BASA que ascienden a 49 millones de dólares. Las tarifas actuales de aguas residuales se mantendrán durante al menos un año, después del cual los clientes pasarán de una tarifa plana a una facturación basada en el uso. La empresa también aumentará su programa de subvenciones para dificultades económicas en 3.5 millones de dólares durante cinco años y extenderá los planes de pago a los clientes comerciales.
Pennsylvania American Water는 Butler Area Sewer Authority (BASA)의 폐수 시스템을 2억 3천만 달러에 인수했습니다. 이 시스템은 Butler 카운티의 32.5 평방 마일에 걸쳐 15,000개 이상의 고객 연결을 제공합니다. 회사는 펌프 스테이션, 전기 안전 및 처리 절차를 포함한 인프라를 업그레이드하기 위해 향후 5년 동안 7,500만 달러 이상을 투자할 계획입니다. 이 거래는 BASA의 4,900만 달러 부채와 책임을 없앨 것입니다. 현재의 폐수 요금은 최소 1년 동안 유지되며, 이후 고객은 고정 요금에서 사용 기반 청구로 전환됩니다. 회사는 또한 향후 5년 동안 어려움 보조금 프로그램을 350만 달러 늘리고 상업 고객에 대한 지불 약정을 연장할 것입니다.
Pennsylvania American Water a finalisé l'acquisition pour 230 millions de dollars du système d'eaux usées Butler Area Sewer Authority (BASA). Ce système dessert plus de 15 000 connexions client sur une superficie de 32,5 miles carrés dans le comté de Butler. L'entreprise prévoit d'investir plus de 75 millions de dollars sur cinq ans pour moderniser l'infrastructure, y compris les stations de pompage, la sécurité électrique et les procédures de traitement. Cet accord permettra d'éliminer la dette et les passifs de BASA s'élevant à 49 millions de dollars. Les tarifs actuels des eaux usées seront maintenus pendant au moins un an, après quoi les clients passeront d'un tarif forfaitaire à une facturation basée sur la consommation. L'entreprise augmentera également son programme de subventions pour les difficultés économiques de 3,5 millions de dollars sur cinq ans et étendra les arrangements de paiement aux clients commerciaux.
Pennsylvania American Water hat die 230 Millionen Dollar schwere Übernahme des Butler Area Sewer Authority (BASA) Abwassersystems abgeschlossen. Das System bedient über 15.000 Kundenanschlüsse auf einer Fläche von 32,5 Quadratmeilen im Butler County. Das Unternehmen plant, über die nächsten fünf Jahre mehr als 75 Millionen Dollar in die Modernisierung der Infrastruktur zu investieren, einschließlich Pumpstationen, elektrische Sicherheit und Behandlungsverfahren. Der Deal wird die Schulden und Verbindlichkeiten von BASA in Höhe von 49 Millionen Dollar beseitigen. Die aktuellen Abwassergebühren werden mindestens ein Jahr lang beibehalten, danach werden die Kunden von einer Pauschalgebühr auf eine verbrauchsabhängige Abrechnung umstellen. Das Unternehmen wird auch sein Notfallhilfsprogramm in den nächsten fünf Jahren um 3,5 Millionen Dollar aufstocken und die Zahlungsvereinbarungen für gewerbliche Kunden verlängern.
- Acquisition adds 15,000 customer connections expanding market presence
- Planned $75 million infrastructure investment over 5 years
- $3.5 million increase in hardship grant program
- Extension of payment arrangements to commercial customers
- Retention of approximately 30 BASA employees
- Future transition from flat rate to usage-based billing may impact customer costs
- Significant capital expenditure of $230 million for acquisition
Insights
The
The acquisition strengthens AWK's regulated utility business model and expands its rate base, which typically translates to predictable revenue streams and earnings growth. The commitment to maintain current rates for one year, followed by a transition to usage-based billing, suggests potential for future revenue optimization. The
The strategic acquisition expands Pennsylvania American Water's wastewater infrastructure footprint significantly, bringing their total customer connections to over 113,000. The planned
The transition from flat-rate to usage-based billing aligns with industry best practices and typically leads to more efficient resource utilization. The retention of BASA's workforce ensures operational continuity while providing these employees access to broader career opportunities within a larger organization. This acquisition demonstrates AWK's commitment to consolidating fragmented water utility operations while maintaining service quality.
“Pennsylvania American Water is proud to continue building our solid legacy of operation in
Pennsylvania American Water plans to invest more than
In addition to the system investments above, Pennsylvania American Water will nearly double the shareholder contribution to its hardship grant program, increasing the fund by
“This has been a monumental effort by so many partners who worked tirelessly to get this deal across the finish line,” said
In October 2022, BASA agreed to sell its wastewater system to Pennsylvania American Water. The Authority deemed the sale essential to improving the system's infrastructure and removing its burden of meeting increasingly stringent environmental standards and regulations. Proceeds from the sale are expected to be used by BASA to eliminate the Authority's existing
“This is an exciting time,” Butler Township President Commissioner James Lokhaiser Jr. “It’s not often that you’re presented with such an amazing opportunity like this one. We are so grateful to the residents who engaged with us and shared their ideas to ensure we got the best deal possible. I also cannot say enough about Pennsylvania American Water’s commitment and willingness to work with every single stakeholder to make sure everyone was fully informed about how this transition will work. This is the start of something new and big for our communities.”
The Pennsylvania Public Utility Commission (PUC) approved the purchase on Nov. 9, 2023, following a settlement with interested stakeholders. The PUC regulates, reviews and approves rates and rules and regulations, and any future changes to rates would have to be reviewed and approved by the Commission. Pennsylvania American Water will maintain current wastewater rates for at least one year. Customers will eventually transition from flat rate billing to usage-based billing, which is calculated on the water consumed as measured by the water meter.
“This settlement marks a significant milestone and much-needed relief for small businesses with the establishment of the first-ever formal commercial customer payment arrangement with Pennsylvania American Water,” said Pennsylvania Small Business Advocate NazAarah Sabree. “Implementing this program will help reduce the financial pressures small businesses experience due to increased utility expenses. With these structured plans, we are empowering small businesses to manage their financial commitments while continuing to thrive. Thank you to Pennsylvania American Water for understanding these businesses' vital role and for your commitment to supporting their success.”
Approximately 30 BASA employees have been offered employment with Pennsylvania American Water, subject to standard pre-employment screening. These employees gain immediate access to training, development and career opportunities in Pennsylvania American Water's or its parent company's operations.
With today’s acquisition, Pennsylvania American Water is the wastewater service provider for more than 113,000 customer connections across the Commonwealth.
About American Water
American Water (NYSE: AWK) is the largest regulated water and wastewater utility company in
About Pennsylvania American Water
Pennsylvania American Water, a subsidiary of American Water, is the largest investor-owned water utility in the state, providing high-quality and reliable water and wastewater services to approximately 2.3 million people.
AWK-IR
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Media Contact:
Gary Lobaugh
Director, Government and External Affairs
gary.lobaugh@amwater.com
Source: American Water
FAQ
How much did Pennsylvania American Water pay for the Butler Area Sewer Authority system?
How many customers does the acquired BASA system serve?
What infrastructure investments will Pennsylvania American Water make in the BASA system?
Will BASA customers see immediate rate changes after the acquisition?
