The city of Chester is not waiting around for the courts to settle the dispute that has blocked their deal with the Chester Water Authority.
The city is again going into "sell" mode.
City Council Wednesday approved a move to accept bids to buy the iconic water company that serves customers in the city and dozens of surrounding towns in both Delaware and Chester counties.
It's the latest twist in a story that has taken more turns than a rollercoaster. And it probably feels about the same way for Chester Water Authority workers.
It's no secret that the city needs money in its years-long effort to climb out distressed status. With E-Consult, the consultant hired by the state to help guide the city's finances whispering in its years, Chester has looked at the water authority as a way to raise money.
The threat to the water authority actually goes back a few years, when utility giant Aqua Pa. offered an unsolicited bid to buy Chester Water for a cool $320 million.
That offer was soundly rejected by the Chester Water board, which found itself under siege from both workers and customers who feared massive rate hikes after a takeover by Aqua. Chester Water Authority has about 42,000 customers in some 43 municipalities in Chester and Delaware counties.
But no sooner than that crisis passed than another loomed on the horizon. That would be the sea of red ink the city of Chester has wallowed in for years. The city now found itself under a deadline to emerge from Act 47 "distressed" status or face the possibility of going into receivership.
E-Consult thought it saw a path out for the city - by selling off all or part of the Chester Water Authority.
Instead, the two sides got together and cut a deal.
In exchange for a $60 million bailout, the city would give up its rights to a sale of any or all of the company for 40 years. In order to raise the funds for the $60.2 million payment, CWA announced plans for a 10 percent rate hike. Customers grumbled, but still preferred that scenario to a takeover by Aqua.
All settled, right?
Uh, not exactly. Aqua, which happens to be customer of Chester Water, cried foul. The utility giant went to Delaware County Court in an effort to block the deal, saying they saw no upside for customers, them included.
That's where it's been now for a couple of months.
Now Chester is once again moving forward with a possible sale of the company.
Why do I get the feeling that Aqua could soon be knocking on the city's door?
The resolution passed by City Council requests what is referred to as an RFP - request for proposal - to buy the company.
A statement from Mayor Thaddeus Kirkland announcing the move makes the case that the city has the right to sell off the company, something that Chester Water has questioned in the past.
"Under Pennsylvania law, as the incorporating entity, the City of Chester is entitled to pay off the debts of the Authority and then take ownership of its assets," the statement proclaims. "By issuing the RFP, City Council tonight decided to explore how to pursue the path toward a more fiscally healthy future for the City."
It's clear the city is frustrated that it has been unable to close the deal with Chester Water.
"Over the last two years, lawyers for the authority and the City of Chester, along with myself, have worked to try and reach a settlement agreement in principle," Kirkland's statement said. "To date, we have been unsuccessful in doing so."
It's equally clear that the city realizes this is likely not going to sit well with Chester Water, its workers and customers, and the long tradition of the company in the region.
"Any proposal we can envision selecting will have to include, a seamless transition from the authority to a successful bidder and include meaningful rate protections for the system’s users and will have to come from an operator with a long track record of responsible water-industry stewardship — a history that we as a City simply do not have," the statement says. "For those reasons, among many others, we know we need to find the right partner to take over and own these assets if our conversations with the CWA continue to bear no fruit."
The next move in this long saga? Look for another offer from Aqua.
We'll have full coverage later today.
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