17414_Authority_April_2024

municipalauthorities.org | 51 Bellitto said any assertion that low rates equals infrastructure disinvestment is false. “We’re a nonprofit,” Bellitto said. We provide low cost and high value to our customers. At North Penn Water Authority, our average customer spends $1 per day for all the water for a household.” Bellitto criticized the for-profit business model in public utilities due to the high salaries of top executives. “My entire organization of North Penn Water Authority — 52 employees. Our whole aggregate salary is four and a half million dollars. There you go. You got the whole company doing all the work every day, 52 employees making the same amount of money as the top guy at Aqua. This is why they have to raise the rates,” he said. “This aggressive push to privatize municipal systems is driven by an upper management of these private utilities who are motivated by their own personal financial benefit,” Bellitto said. But not everyone who testified wants to kill Act 12. In some municipalities that have garnered the interest of private water companies — like Chester and Towamencin, residents have gone on the offensive to block the deals, oftentimes clashing with elected leaders. Results, however, have been mixed. Kofe Osei, an organizer with NOPE and a newly elected Towamencin Township Supervisor, said privatization efforts have had a negative impact on democracy. He said Pennsylvania American Water’s attempt to purchase Towamencin’s sewer system, which is tied up in court, has laid bare issues of the state’s referendum laws. “Even in the face of lawsuits from residents to compel the township to exit the sale, the pro- sale supervisors have committed public dollars in our budget to defending their clearly unpopular decision in court,” Osei said. The Public Advocate vs. The Public Utility Commission The second panel of the day focused on policy solutions from the perspective of local utility and municipal leadership, which included the Pennsylvania Office of the Consumer Advocate, and the Pennsylvania Public Utilities Commission. Pennsylvania’s Consumer Advocate Patrick Cicero also called for the repeal of Act 12. Referring to it as an “utter failure,” Cicero said his office has found that water and wastewater rates in Pennsylvania have grown at some of the fastest rates in the country. As a result, he said people are unable to pay their bills. Cicero said that if the legislature cannot agree to a full repeal, his office’s second recommendation is to sunset the provisions in the law after a set date and conduct a complete review of Act 12. While Stephen DeFrank, Chairman of PA Public Utility Commission, did not offer a definitive policy stance from his agency, which ultimately approves all rate hikes. DeFrank said there is an underlying interplay between Act 12 and Act 11 of 2012 that is also fueling rate increases. Act 11 allows private companies, which own multiple water and wastewater treatment systems, to spread the cost of upgrades among its entire statewide customer base, regardless of where a ratepayer draws water. DeFrank refers to this as a “cross subsidization tool.” Anthony J. Bellitto, Jr., PE, Executive Director of North Penn Water Authority, and Noel Brandon, Board Chair of Chester Water Authority, defended municipally-owned water systems during the Senate hearing. (Photo: Kenny Cooper/WHYY) State Senators Judy Schwank, Katie Muth, Carolyn Comitta, and John Kane prepare for the first panel on Act 12. (Photo: Kenny Cooper/WHYY)