Another ‘case of the underdogs’: Towamencin residents oppose sewer privatization

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For-profit water companies have placed bids on Towamencin Township’s sewer system and this month, residents will have a chance to voice their concerns to township supervisors.

Public town halls will be held in-person and streamed via Zoom at 7 p.m. on Wednesday, April 6 and Wednesday, April 20.

In September 2020, Towamencin supervisors voted unanimously in support of a study on whether to value and monetize, or privatize, the sewer system. PFM, Public Financial Management, a private consulting agency, has been conducting that analysis, and will present their findings at the town halls.

Towamencin Township in Montgomery County, is part of North Penn School District with about 18,000 residents, according to the 2020 United States Census.

Many Towamencin residents have opposed the privatization of their sewer system since 2021, when local group Towamencin NOPE, “Towamencin Neighbors Opposing Privatization Efforts,” was created. The Facebook group has over 400 members, and is disseminating a petition by Food and Water Watch.

Over the course of three months,  NOPE pushed for Towamencin to hold town halls over the issue, and now, they are relieved they’re finally happening.

According to NOPE organizers, they knocked on around 500 doors to spread awareness on the potential sewer sale. Early in their campaign, most of the residents they spoke to were unaware of the issue. So far, they say no one that they’ve spoken to supports the sale.

Towamencin’s sewer system is one of many municipal public utilities in Montgomery County and across the Philadelphia suburbs that have either been at risk of takeover or have been sold to for-profit companies.

After paying PFM $9,500 to perform the analysis and valuation of the sewer system, Towamencin supervisors voted unanimously in January 2021 for PFM to begin the second phase of the process; to gauge interest from potential bidders and to analyze those bids.

The Township then received five formal bids offering terms of sale or lease from interested firms. Those bids include one from NextEra Energy for $115.3 million, Pennsylvania American Water for $92.4 million, and Aqua Pennsylvania for $54.1 million.

Sewer rates would rise if any of these companies close the sale. The current rate is $450 a year and the ten-year sewer rate estimates range from $874 for Aqua to $1,060 for NextEra. All the bids include a two-year rate freeze.

Kofi Osei, 29, founder of Towamencin NOPE, isn’t looking forward to PFM’s presentation during the town halls, which will come before the public comment portions.

Osei described it as a “full infomercial from the consultants,” and said, “[the] supervisors can spin this however they want before taking our input.”

NOPE organizers’ concerns about PFM’s intentions are not unfounded. In a January 2021 contract agreement, PFM, who has conducted similar studies in the Philadelphia region, including for the City of Chester, states they will not collect fees for phase two and three of their process “if the transaction does not close.”

“They’re going to present a bunch of projects that we never knew we needed to do,” Osei said. “And somehow, it’s going to look like we should privatize, even though our system is well-maintained and the township’s finances are fine too.”

Osei created the Towamencin NOPE group after seeing the after effects of Cheltenham selling its sewer system to Aqua Pa. Cheltenham utility rates rose soon after the sale.

Local groups have been sprouting across Montgomery County in efforts to stop sewer system privatization, and in many cases, have won.

David McMahon started the original NOPE in Norristown, which won the battle against Aqua Pa’s efforts to buy its sewer system. McMahon then advised Conshohocken NOPE, which also turned Aqua away. Now, he’s helping Towamencin’s branch.

In relation to other private water companies, Aqua owns the majority of utilities in the Philadelphia suburbs. In August 2021, the company filed a rate case petition with the state Public Utility Commission seeking to increase wastewater bills by 33%.

While Towamencin has had fairly stable sewer rates for decades, rising rates is only one of Osei’s concerns.

He said it’s about the public’s ability to have input on what happens with their utilities.

“This is bad for democracy”

Osei said a major fear is the public losing their say on the sewer system and its increasing rates.

“They can make this decision, and then three years from now, when the rates rise, it’ll be too late to complain about it,” Osei said.

He said it’s also an issue if Towamencin residents’ voices are not included in the decision to sell their public utility.

“This is really bad for democracy,” Osei said. “If our local government is telling us we need to build a new road or repair a fire station, they should come to the residents and ask us how we want to deal with that … If we want to raise taxes or if we want to lower some service to pay for something else, then we can have those discussions, instead. But this is politically expedient money.”

Donald Delameter, Towamencin Township Manager, said the point of the town hall is to get public “comments and get questions and have a dialogue about it.”

But Judy Phipps, 76, another NOPE organizer, said she still feels excluded from the township’s decision making. She said it reminds her of voter disenfranchisement.

“And not only are you not listening to my vote, but you’re not even telling me what it is that I’m voting for or against,” said Phipps.

She’s lived in Towamencin for over 50 years and has knocked on over 100 doors in her Hunter Hill neighborhood in the past year.

“Everybody says, ‘This is really wrong. We don’t want this sold,’” Phipps said.

She’s particularly worried about older adults, those who rely on fixed incomes, through SSI or Social Security, who may not be able to afford the projected rates if Towamencin sells.

According to the 2020 United States Census, 22% of Towamencin residents are 65 and up.

According to The Reporter, Scott Shearer of PFM said during the Jan. 13 Township Supervisors meeting that residents will see some kind of rate increase no matter if the Township sells.

But Phipps, like Osei, believes residents have a right to own the utility, “I don’t believe this is something that the supervisors have the right to sell out from under us,” Phipps said. “Once the asset is gone. We have no say in anything.”

Phipps has attended public meetings to express her concerns, and said she doesn’t feel like the supervisors are really listening, or answering residents’ questions.

She said the township could do a better job disseminating information. For instance, she only found out about the potential sale because of Osei’s NOPE Facebook page in 2021.

“They were going to sell this and not tell people about it. And that just seems wrong to me,” Phipps said. “It feels like a case of the underdogs being squashed by the people in power and the people in power not being willing to listen.”

The Township sent a letter informing residents of the potential sale process in October 2021. It also compiled an FAQ on its website, including general reasons for why the Township may want to sell the sewer system.

The FAQ includes broad plans on how the Township would use the sale money.

But Phipps said the website is “difficult to navigate.” And she said she has asked the township for further details on its plans for the sale money, and is left empty handed.

Delamater did not want to share with WHYY News how the Township plans to use the sale money or the specific reasons why the Township would want to sell, and said that would be discussed during the April town halls.

When asked about residents’ concerns over their voices not being considered in the decision to sell, Delamater did not want to comment.

Delamater said Towamencin will likely make its decision in May 2022.