By Beth Barhydt
The potential sale of Aquarion Water Company, currently owned by Eversource, to the South Central Connecticut Regional Water Authority (RWA) has sparked significant debate and concern in the communities it serves, including New Canaan. Aquarion, one of the largest private water companies in the state, has been regulated by the Public Utilities Regulatory Authority (PURA), ensuring a steady control over water rates and service standards. RWA, on the other hand, operates as a quasi-governmental agency, primarily serving the Greater New Haven area. The concern arises from RWA’s history of higher rate increases and other issues regarding the deal’s financing and the way in which this opportunity for the sale to RWA came about, quickly and quietly moving through what normally would have been a lengthy and public process.
Additionally, the proposed acquisition has financial implications for the municipalities currently served by Aquarion. As a private company, Aquarion contributes significant property taxes to towns like New Canaan.
Local officials, including New Canaan’s First Selectman Dionna Carlson and state Senator Ryan Fazio, have voiced concerns.
Carlson, during a discussion with the New Canaan Sentinel, voiced significant concerns about the potential acquisition of Aquarion Water Company by the South Central Connecticut Regional Water Authority (RWA). With the potential for far-reaching implications on both water rates and town revenue, Carlson made clear that the sale could spell serious challenges for New Canaan residents and the town’s long-term finances.
Carlson first addressed the key issue of rate increases. Aquarion, which has been privately owned by Eversource and regulated by the Public Utilities Regulatory Authority (PURA), has imposed only an 8.5% rate increase over the past decade. In stark contrast, RWA, a quasi-governmental agency responsible for water service in the Greater New Haven area, has raised its rates by over 40% during the same period. “RWA’s claim that it would hold rates steady after the acquisition is difficult to believe given their track record,” Carlson stated. She expressed concern that RWA’s internal financial structure, which lacks oversight from PURA, would inevitably lead to higher costs for consumers. “Once they are no longer regulated by PURA, RWA would have free rein to impose rate hikes without the same level of accountability.”
Carlson went further, questioning the feasibility of RWA’s pledge not to impose further increases. “They’ve promised no new rate hikes, but I don’t see how that’s sustainable,” she said. “The reality is, if a quasi-government agency like RWA takes over, they will likely need to recoup the costs of the acquisition, and that money will have to come from the customers.”
State Senator Ryan Fazio echoed her concerns, particularly regarding the transparency of the legislative process leading to the potential aquisition. “This was a major change that appeared out of nowhere,” Fazio said, pointing to the lack of public debate before RWA was allowed to enter the bidding process. “This was a multi-billion dollar policy shift that happened without any substantial public hearings or input from the communities that will be directly impacted.”
Fazio was particularly concerned about the financial impact on households. “RWA’s rates are significantly higher than Aquarion’s. If they take over, residents in New Canaan and other towns could see their water bills skyrocket,” he explained. “The lack of oversight from PURA is a huge red flag. We could be looking at rates 40% higher or more in the near future.”
Carlson also focused on the financial impact on New Canaan beyond rate increases, specifically regarding the loss of property tax revenue. Currently, Aquarion pays more than $300,000 annually in property taxes to the town. However, if RWA takes over, as a quasi-governmental agency, it would be exempt from property taxes and would instead make Payments In Lieu of Taxes (PILOT). Carlson expressed doubts about the reliability of PILOT payments, pointing out that RWA has stated it would not increase payments even if they make improvements to their infrastructure. “This is a serious issue for New Canaan. Without those property taxes, the town could lose a critical source of revenue that we depend on for essential services,” Carlson explained. “PILOT payments are not a reliable replacement. They’re static, which means they won’t keep pace with inflation or improvements. Over time, we’d be essentially receiving less and less money.”
Carlson also emphasized the potential loss of influence for New Canaan on RWA’s board of directors. Under the proposed governance structure, board seats would be allocated based on the number of water customers and the amount of land owned by the water utility in each municipality. Larger cities like Stamford, Norwalk, and Bridgeport would have a disproportionate amount of representation compared to smaller towns like New Canaan. “Our town would essentially be sidelined when it comes to decision-making,” Carlson warned. “New Canaan’s representation would be minimal compared to these larger cities, and we would have little say in how decisions affecting our water service are made.”
Fazio highlighted this as a major concern, suggesting that New Canaan and other smaller towns could find themselves at the mercy of larger municipalities when it comes to critical decisions about water rates and infrastructure investments. “This governance structure is set up to favor the bigger cities,” he said. “New Canaan would be left with a diminished voice, and that’s not something we can afford when it comes to essential services like water.”
Both Carlson and Fazio called for greater transparency and more robust public discussion about the potential sale. “This sale could have long-lasting effects on our town’s finances and water service,” Carlson said. “We need to make sure that residents are fully informed about what’s at stake and that we, as a community, are involved in the process.”
Fazio echoed this sentiment, urging residents to engage in the discussion and push for more oversight. “This is a critical issue, and it’s not just about rates,” he said. “It’s about how decisions affecting our town are made and who gets to make them. The residents of New Canaan deserve a say in this process.”
As the discussion continues, Carlson and Fazio stressed the need for residents to stay engaged and submit their questions and concerns.
Residents can stay informed by visiting RWA’s website or submitting questions via email to jslubowski@rwater.com or by calling 203-401-2515.
