Area Town Leaders Explore Regional Water Authority

By Steve Bigham

First Selectman Herb Rosenthal met with other area town and state leaders last week to continue discussions on how to address the pending sale of Bridgeport Hydraulic and its 20,000 acres of Connecticut land.

The talk centered on the possibility of the town and state taking over the Water Company and then turning it into a separate public water authority. According to Mr Rosenthal, this could be done by an act of the state legislature and would effectively block the sale of the company to Yorkshire, PLC, a subsidiary of Kelda Group of Great Britain.

Kelda Group is nearing a $590 million deal, which would make it the new owner of Bridgeport Hydraulic (aka Aquarion). Analysts predict the deal will yield little more than five percent for its investors.

“It seems like an odd investment. The concern we all have is that Kelda will raise rates or sell off the land in order to make it work,” Mr Rosenthal told the Board of Selectmen Monday night.

Bridgeport Hydraulics, “Aquarion,” had planned to sell of 1,390 acres of open space in Fairfield County including 46 acres in Newtown. State and local officials fear Kelda has the same plan, although it recently agreed to a moratorium on the sale of any land for two and three years.

There are advantages to a public utility in that it does not have to pay income taxes, can borrow money at municipal bond rates rather than corporate rates, and does not have to pay dividends to shareholders. And the evidence is there, according to Mr Rosenthal, pointing to New Haven’s South Central authority, whose rates are 27 percent lower than those offered by Bridgeport Hydraulic.

The water company’s rates would not affect most Newtown residents since they receive their water from a different source. However, the stabilization of rates by a public water authority would minimize the need to sell off the land, Mr Rosenthal said.

Area towns would all have representation on the proposed authority.

Last week’s meeting was held in Bridgeport at the offices of Bridgeport Mayor Joseph Ganim.