Acquisition Of Newtown Water Companies

Bodes Well For Former Owner

By John Voket

In mid-January, Aquarion Water Company completed the acquisition of assets of several Connecticut water companies, including the Olmstead Water Company and Chestnut Tree Hill Water Company in Newtown, which were formerly owned by Ron Black, current operator of Watertown-based Water System Solutions & Design.

But the roughly 210 local customers of these small water companies will initially notice very little change from the services they were receiving from Mr Black, and perhaps some from his father, since these water companies have been in the Black family for two generations.

That is because Aquarion plans to keep Ron Black on as the primary operator, he told The Bee February 2, one day after his first team meeting with Aquarion officials.

In the long run, however, Mr Black said that customers of these small water companies may notice improvements in their service as a result of capital investments Aquarion will likely make to bring the technology and utility infrastructure up to 21st Century standards, something Mr Black was unable to do as an owner-operator.

“I’m glad that Aquarion is contracting with my firm to keep me on as operator of these two Newtown systems, as well as hiring my firm to do the capital improvements that my smaller company just couldn’t formerly afford,” Mr Black said. “With 580,000 customers in the region, Aquarion can take up the improvements for the customers in my former systems.”

Mr Black was also hopeful that with his expertise, Aquarion would consider also hiring his firm to work on systems they already own, or are considering acquiring in the future.

Calling it a win-win-win situation for himself, his former customers, and Aquarion, Mr Black said the latest move by Aquarion is freeing him up to do what he does best, and removes the need for him to occupy too much of his time handling “administrative chores.”

Charles V. Firlotte, Aquarion president and CEO, said the latest acquisitions are “part of a strategic growth initiative Aquarion implemented some time ago, and it reinforces our commitment to serving communities in the greater Danbury area.”

As the largest private water utility in New England, and the seventh largest in the United States, Mr Firlotte said Aquarion has the unique ability to purchase smaller water systems that may have difficulty meeting all Department of Public Health (DPH) directives.

“As we integrate these water companies into the larger Aquarion network, we will be working closely with all regulatory agencies to ensure compliance with applicable standards,” the Aquarion official added.

The company that is headed by Mr Black today was started in the 1920s by his grandfather R.J. Black, and it has gone through myriad business and name changes since. When the second generation of the Black family, Ron’s father, was coming of age, R.J. said he would turn over the family business, as long as his son completed a college degree.

The same offer was made to Ron when he graduated from high school, so armed with a degree in music education and years of tutelage under his father, Ron Black eventually inherited the company in 1998.

The Olmstead and Chestnut Tree Hill Water Companies were just two of the 600 to 700 small neighborhood utility companies operating in Connecticut at present, and when his father took them over in the late 1980s, they were considered “troubled systems.”

Only One Way To Go

As his family worked to maintain and improve the 14 systems under their ownership, Ron eventually realized that the only way the complete modernization of infrastructure could occur was if the companies were acquired by an entity that had the capital to handle the expense.

And that meant a customer base large enough to spread the capital costs across hundreds of thousands of rate payers — instead of the few hundred under the Black family’s ownership.

Throughout the years, the Black family has designed, built, and serviced hundreds of public water supply systems.

“This has given us the knowledge and expertise required to diagnose and resolve the ever-increasing and complex problems and issues presently facing owners and operators of regulated public water systems,” Mr Black said. Today, his Water System Solutions & Design firm handles all phases of small public water supply system construction and renovations.

He builds complete DPH-approved water supply systems and services components, both new and existing. In addition, the firm handles:

*Well and booster pumps, systems and stations — repairs and installations.

*Chlorination and pH treatment systems — repairs and installations.

*Water storage and pressure tank replacement, installation, inspection, and cleaning.

*Repairs and installations of water system electrical control and alarm systems.

Mr Black also brings to the table several decades of experience working successfully with the State Department of Public Health and Department of Public Utility Control (DPUC).

“Our firm has had extensive experience in the design, design-build, and operations phases of both existing system renovations, and new systems from design through completion, particularly when it comes to noncommunity systems,” he said. “Our experience with both the DPH and DPUC regulatory process and personnel continue to allow us to move projects through from design, well installation and testing if required, construction and final approvals, activation and operations.”

Systems For Schools, Industry

One of the local DPH-regulated water systems his company recently designed, built and/or and steered through DPH and DPUC was TNT Enterprises. He also completed work for the Millbrook School district in New York, where Mr Black designed and built a new pumping station for the school campus; four new water systems for the Mansfield Public School district; three systems for the Region 6 School District; and new pumping station/system for 250 homes in the Greenridge Tax District in Brookfield.

Mr Black explained that the regulatory and approval processes at the state level for new and renovations design, building, operations, and management of DPH-regulated small water utilities has become more complex, cumbersome, and detailed over the past few years, and is now reaching a new level with the December 1, 2009, effective date for the Groundwater Rule, while at the same time increasing the responsibilities and liability exposure for the designers, builders, operators, and owners alike.

“Our in-house designers work in concert with the owner’s site engineering firm as needed to meet and exceed all DPH and DPUC standards and requirements,” he said. “We typically take systems from the beginning to the end, inclusive of design, submittals, construction, and operations.”

In regard to his latest venture, Mr Black wanted Newtown customers to know that “In no way are me and my company becoming employees of Aquarion.”

He also said that he appreciates Aquarion’s commitment to the environment, and believes that the utility can still generate a profit for investors while “making the water industry better.” In the coming months, Mr Black said, this will be borne out as Newtown customers begin to hear about planned capital improvements finally in the works as a result of the investment being made by the conglomerate.