Pennsylvania American Water to buy Butler wastewater system for $231.5M

Hershey-based Pennsylvania American Water, a subsidiary of American Water, has signed an agreement with the Butler Area Sewer Authority to purchase its wastewater system for $231.5 million.

The system serves nearly 15,000 customers over 32.5 square miles, including the City of Butler; Butler and Center townships; East Butler borough; parts of Connoquenessing borough and Summit and Oakland townships; and a small portion of Penn Township.

Pennsylvania American Water already provides drinking water to approximately 19,500 customers in the region.

As part of the agreement, the utility will offer jobs to all of Butler Area Sewer Authority’s employees; maintain the existing operations center for at least 10 years; take over the authority’s planned capital improvement projects utilizing qualified Butler-area contractors; and adopt the authority’s rates at closing with a minimum 1-year rate freeze.

Pennsylvania American Water will make necessary treatment and collection system upgrades to improve the wastewater system, expected to total more than $75 million.

Once approvals from regulators are received, the transaction is expected to close by the end of next year.

“We are pleased that BASA and other community leaders recognized the value we provide to our water customers and are entrusting us with the future ownership of their wastewater system,” Pennsylvania American Water President Mike Doran said in a release. “… Pennsylvania American Water is well positioned to step in and assume responsibility for the community’s wastewater needs by using the existing expertise of current employees, leveraged by the resources we can provide as the commonwealth’s largest water and wastewater utility.”

Paula Wolf is a freelance writer

Pennsylvania American Water to invest $16.5 million in upgrades

Mechanicsburg-based Pennsylvania American Water announced plans this year to rehabilitate 14 of its water storage tanks and build seven new structures.

A release estimated the cost of the improvements at about $16.5 million.

The rehabilitation program involves inspecting, sandblasting and repainting tanks to extend their service lives and help protect water quality.

Two of the projects are in central Pennsylvania. The utility will rehabilitate and repaint a 60,000-gallon ground storage tank in Lake Heritage, Adams County, and a 3 million-gallon ground storage tank in Lower Allen Township, Cumberland County.

“Storage tanks are critical to meeting the supply demands of our customers and providing fire protection for our communities,” Pennsylvania American Water President Mike Doran said in the release. “Properly and proactively maintaining tanks benefits our customers because of the cost efficiencies we can achieve by rehabilitating rather than replacing them.”

Pennsylvania American Water, a subsidiary of American Water, is the largest investor-owned water utility in the state, providing water and wastewater services to approximately 2.4 million people. Last month, the company completed a $235.3 million deal with the City of York to acquire York’s wastewater system assets.

Paula Wolf is a freelance writer.

York Water Co. revenue grows 9% in Q1

York Water Co. reported first-quarter operating revenue of $14.24 million, an increase of nearly 9% from a year ago.

Meanwhile, net income was $3.859 million, up $154,000 compared with the first three months of 2021.

A release explained that revenue rose primarily due to growth in York Water Co.’s customer base from the West Manheim Township wastewater acquisition and utilization of the Distribution System Improvement Charge. The DSIC is a Pennsylvania Public Utility Commission-allowed charge that water utilities collect from customers for the replacement of aging infrastructure.

The expansion in revenue was offset somewhat by higher operation and maintenance expenses and depreciation.

From January through March, York Water Co. invested $7.5 million in capital projects, such as routine items and wastewater treatment plant construction as well as replacements and improvements to infrastructure. The company estimates it will invest $35.3 million more in 2022, excluding acquisitions, for armoring and replacing the spillway of Lake Williams dam, additional main extensions, and routine improvements to its pipes, service lines and other facilities to ensure a safe, adequate, and reliable supply of drinking water.

PUC approves sale of York wastewater system  

Pennsylvania American Water Co. received final approval Thursday from the state Public Utility Commission for its $235 million purchase of the York city wastewater system, the PUC announced. 

The City of York and the York Sewer Authority entered into an agreement two years ago to sell the system to Pennsylvania American Water, which filed an application seeking PUC approval of the transaction in July 2021. The commission held a public input hearing on the proposed acquisition Jan. 5 of this year. 

As part of the agreement, Pennsylvania American Water said in a previous release, it will request approval to preserve York city’s current wastewater rates for a minimum of three years, offer employment to all wastewater system employees, and contribute at least $50,000 in donations to nonprofit organizations serving city residents. 

The York wastewater system serves 13,700 customers in the city and 30,000 through municipal agreements with the townships of Spring Garden, Manchester, West Manchester, York and Springettsbury and the boroughs of North York and West York. Last May, Mechanicsburg-based Pennsylvania American Water purchased the Royersford borough wastewater system, which serves nearly 1,600 customers, for $13 million. 

The release from the utility also noted that it has experience with larger municipal systems like York’s, having acquired the wastewater networks of McKeesport in 2017 and Scranton in 2016. 

York Water Co. sees increased revenue in 2021 

York Water Co. reported 2021 operating revenue of $55.12 million, up from $53.85 million the year before. 

The $1.27 million increase was primarily due to utilization of the Distribution System Improvement Charge – a Pennsylvania Public Utility Commission-allowed charge that water utilities collect from customers for the replacement of aging infrastructure – and an expanding customer base. 

The rise in revenue was partially offset by higher operation and maintenance expenses and depreciation, a release noted. 

Last year, York Water invested $34.4 million in capital projects. It also invested $12 million to acquire West Manheim Township wastewater collection system, adding approximately 1,800 new wastewater customers. In 2021, the utility replaced about 61,000 feet of pipe to improve its distribution system, reduce ongoing expenses and improve customer service. 

President and CEO JT Hand, who announced the annual results, said in the release that York Water plans to invest approximately $44 million in 2022 and $50 million in 2023 – not counting acquisitions – for main extensions, dam improvements, an elevated water tank, water treatment plant construction, and improvements to pipes, service lines and other facilities. 

$2.74 million water main upgrade to start in Dauphin County

Pennsylvania American Water announced Thursday that it’s beginning construction to replace nearly 2 miles of water main in Derry Township and Steelton borough to improve reliability, reduce service disruptions, and increase water flows for firefighting.

The cost of the Dauphin County system upgrades is $2.74 million. They will cover 10,000 feet of water main, some dating back to the early 1900s. Traffic restrictions will be in force during construction.

In Derry Township, a $1.4 million project will replace 5,800 feet of aging water main, installed in the 1960s to 1980s, with an 8-inch ductile iron main. Work will take place 7 a.m. to 5 p.m. Monday-Friday on Limerick Court from Wood Road to Cook Court, Windsor Court, Cook Court, Randall Circle, Highland Road, and Leearden Road from Mine Road to Sand Road.

The $1.34 million Steelton project will replace 4,200 feet of aging water main, installed in the early 20th century, with an 8-inch ductile iron main. Work will take place 7 a.m. to 4 p.m. Monday-Friday on South Second Street from McKinley Street to R Street, Q Street from South Second Street to South Fourth Street, South Seventh Street from Spruce Street to Marshall Street, and South Sixth Street from Spruce Street to Marshall Street.

During construction, customers might experience temporary service interruptions, discolored water and/or lower than normal water pressure.

Harrisburg entrepreneur finds niche in flavored water space

Sean Banks, founder of Krisp Drinks LLC, created the Harrisburg-based flavored water company after finding that many flavored water products are still made with sugar and artificial sweeteners. PHOTO/IOANNIS PASHAKIS

Harrisburg-native Sean Banks had an epiphany when he was restocking a cooler at the local convenience store he managed — one that would lead him to starting Krisp Drinks LLC, a beverage company with the goal of providing a healthy alternative to sugary sodas and flavored waters.

Banks, an entrepreneur who previously started his own clothing line, noticed that he was restocking the flavored waters in his coolers multiple times a day. When he asked customers what compelled them to buy the products, many told him it was because of their perceived health benefits.

Upon researching the most popular flavored waters in the store, Banks said that many of the drinks that customers believed were a healthy alternative to sugary sodas weren’t as healthy as those customers may have thought.

“I started conducting research on different types of waters — their pH, flavors and their perceived benefits,” Banks said. “What I found was that most flavored waters are full of sugar and artificial ingredients.”

Banks then had a second epiphany while ordering those drinks for the store. Out of all of the drinks he stocked the coolers with every day, none of them were produced by Black-owned companies.

“The one thing I kept noticing was that there were no brothers on the shelf,” he said. “I could be that person to help make change to bring about some diversity in those coolers.”

These two realizations culminated in a budding business for Banks after his mother was diagnosed with diabetes and she had to swiftly change her diet, which he said was difficult for her because of her love of sugary drinks.

“She loved sodas and sweet tea, but knew she had to make a change,” he said. “That’s when I knew I had to make a drink that was diabetic friendly, organic and sweet enough for those used to sugary beverages.”

Banks quickly got to work on Krisp Drinks LLC — a flavored waters and drinks company that donates two percent of its profits to charities serving youth in underserved communities.

Beverage companies spent $1.04 billion in 2018 to advertise surgery drinks and energy drinks, according to a report released last month from the Rudd Center for Food Policy & Obesity at the University of Connecticut. Of those ads, Black preschoolers, children and teens viewed twice as many TV ads for sugary drinks and energy drinks compared to White youth in the same age groups.

Banks saved what he could while working at the convenience store and called a Shenandoah manufacturer that gave him a list of things he would need before he could move forward on the manufacturing of his product.

Within two months, Banks completed the manufacturer’s list and soon found a partner for the venture.

Krisp produces three beverage lines: Krisp Flava, subtly flavored spring water; Krisp Fruitish, spring water made with additional flavoring; and Krisp natural spring water. Both Fruitish and Flava’s formulations were created in Banks’ dining room with the help of friends and family members.

Banks said that while the purpose of his drinks are to provide a beverage option in stores that offers zero sugars, zero net carbs and ten calories a bottle, he created the Fruitish line for customers like his mother, who wouldn’t normally purchase flavored waters.

Krisp Drinks currently has three product lines. “Fruitish” is the company’s organic, zero sugar, zero calorie flavored water. PHOTO/IOANNIS PASHAKIS

“(Fruitish) is flavored water but it isn’t organic. It’s designed as an entry point for people used to sodas and sweet tea,” he said. “When we were working with our flavor house that does the professional formulations, I said I needed more sweetener in it. If it doesn’t taste like Kool-Aid, the underserved minority communities won’t like it.”

Banks’ venture was helped along through one-on-one consulting with the Kutztown University Small Business Development Center of Pennsylvania. Martin Bill, a program manager of international trade and agribusiness at the center, said that Sean thoughtful, thorough and methodical in the creation of his company.

“His approach to business and design shows talent,” he said. “He does his homework.”

Krisp first found its way into local convenience stores after Banks began going door to door to local businesses. He said that he found a break in the form of an agreement with Dave Riswold, owner of Harrisburg-based D&F Distributing, who gave him a list of stores his company distributed to and offered to purchase a pallet of the flavored waters and take the drinks to any stores that purchased the product.

Krisp looks to soon expand out of the local market.

The company is currently sending products to big box stores such as Rutters, Giant and Wawa with the hopes of getting the drinks approved and placed into coolers in time for the spring, when most companies reset their products and introduce new ones.

Banks recently signed an agreement with Cascadia Managing Brands, a Ramsey, New Jersey-based food and beverage brand management firm, to take an equity position in the business.

Cascadia is working with Krisp to provide Banks with an avenue to national distribution.

Early in the creation of his company, Banks struck a friendship with leadership at the firm who helped him ensure he was driving the brand in the right direction. He said they were stunned that he had created the product, partnered with a local manufacturer and brought the product to local convenience stores, all on a $35,000 budget.

Now that he is able to fully partner with the firm, Banks said he hopes to begin hiring to have four full-time employees by the end of the year and have the products in over 200 stores in the same time frame.

Suez Water pays $9.5M for Montour County system

Lower Paxton Township-based Suez Water Pennsylvania Inc. has purchased a small water and wastewater operation in Montour County, expanding the company’s reach north of Harrisburg.

The company said Monday that it paid $9.5 million to acquire the water and sewer assets of Mahoning Township, which serve about 1,200 customers. Suez officials said the plan is to connect the Mahoning Township systems with the utility company’s Bloomsburg treatment plant, which opened in 2016.

Suez already has begun laying an $8.5 million water pipeline between Bloomsburg and Mahoning Township, which are about 6 miles apart. The company also said it will spend about $500,000 to replace water and sewer main lines in the Mahoning systems. Customers will continue to pay existing rates, though billing has switched to monthly from quarterly statements.

“Mahoning Township is the perfect fit for us as we expand our customer base in Pennsylvania,” said John Hollenbach, vice president of the company’s Mid-Atlantic division. “It is close to our existing operations and resembles many communities we already serve in the state.”

Suez now serves more than 167,000 people in Pennsylvania in portions of nine counties, including Columbia, Cumberland, Dauphin, Luzerne, Montour, Perry, Schuylkill, Wyoming and York counties. Suez’s Pennsylvania operations are part of New Jersey-based Suez North America, which is a subsidiary of Suez, a French-based utility company.