Pennsylvania American Water to purchase Butler Area wastewater system

Nov. 15, 2023
As part of an approval to purchase the wastewater system, Pennsylvania American Water will increase its affordability assistance contributions and establish a payment arrangement program for commercial customers.

Pennsylvania Water announced that it has received approval to purchase the Butler Area Sewer Authority’s (BASA’s) wastewater system for $230 million.

The approval from the Pennsylvania Public Utility Commission (PUC) follows a settlement agreement reached in August between the Office of Consumer Advocate, Office of Small Business Advocate, and Bureau of Investigation and Enforcement of the PUC.

The approved settlement agreement will expand the company’s assistance programs to address affordability. As part of the agreement, Pennsylvania American Water will nearly double its shareholder contribution to the hardship grant program, increasing the fund by $3.5 million over five years. The agreement also expands the program’s income eligibility criteria from 200 to 250 percent of Federal Poverty Income Guidelines, resulting in an estimated 52,900 additional water and 8,800 additional wastewater customers being eligible to receive bill assistance grants. The agreement also benefits commercial customers by establishing a payment arrangement program for commercial customers – previously only available to residential customers.

Upon taking ownership, Pennsylvania American Water said that it will make necessary treatment and collection system upgrades to improve the wastewater system, which are expected to total more than $75 million.

As part of the agreement, Pennsylvania American Water will offer employment to all of BASA’s employees, maintain the existing BASA operations center for a minimum of 10 years, assume BASA’s planned capital improvement projects utilizing qualified Butler area contractors, and adopt BASA’s rates at closing without any changes for a minimum of one year.

Pennsylvania American Water expects to close on the acquisition by the end of 2023.

The BASA system serves nearly 15,000 customer connections over 32.5 square miles, including the City of Butler; parts of East Butler Borough; and parts of the Townships of Butler, Center, Connoquenessing, Summit and Oakland. Pennsylvania American Water is already the drinking water service provider to approximately 19,500 customers in the region, and its predecessor companies have served the Butler area since the late 1800s.