House Speaker Mike Turzai long has thought that the Pittsburgh Water and Sewer Authority should be privatized, and the Pittsburgh Post-Gazette’s reporting on a Peoples Natural Gas offer to partner with the authority only reinforced that, a spokesman said Thursday.
“You’ve got a private sector company that has come in and offered a billion dollars and will put in the resources necessary to improve that failing infrastructure,” said Neal Lesher, spokesman for Mr. Turzai, R-Bradford Woods. The Peoples offer “seems to make a lot of sense to us,” he added. “I can’t believe the city didn’t take it.”
The Post-Gazette documented an effort by Peoples, starting in 2016, to join forces with the troubled authority, including an assumption of debt that approaches $1 billion, and a pledge of ongoing payments to the city. The company made a formal, written offer in January 2017. The city’s then-chief of staff, Kevin Acklin, served as one of the city’s points of contact with the gas utility.
Mr. Acklin left city hall in January and joined Peoples as vice president and chief legal officer. Mayor Bill Peduto has said that he has no plans to privatize the authority.
Last year Mr. Turzai and Rep. Harry Readshaw, D-Carrick, were prime sponsors of legislation that puts the authority under the oversight of the Public Utilities Commission, effective in April.
Mr. Lesher said Mr. Turzai saw PUC oversight as a way to push for the resolution of issues ranging from leaky pipes to billing issues and boil-water advisories. “There was precedent with asking the PUC, which is experienced in working with private utilities, ensuring that there’s adequate service both on the financial and the consumer protection side,” he said.
After the introduction of the bill in June, he said, the speaker’s office “may have talked with” Peoples representatives about it, Mr. Lesher said. “But really the impetus for the bill had come from the broader business community in Pittsburgh, in talking with groups like the Allegheny Conference and the Chamber of Commerce.”
Morgan O’Brien, president and CEO of Peoples, chairs the Greater Pittsburgh Chamber of Commerce.
Asked whether PUC oversight could be a stepping stone toward privatization, Mr. Lesher said: “I guess it could be. Ultimately, that’s a decision that the city is going to have to make. ...”
Mr. Readshaw said he has had no contact with Peoples and did not view PUC oversight as a precursor to privatization.
Privatization “certainly wasn’t the goal. It wasn’t my goal,” he said. “I’m against [privatization], but ultimately it’s not for me to say. The mayor and city council will have final say on privatization.”
Sen. Wayne Fontana, D-Brookline, said he was worried that privatization would boost rates.
“If you’re going to put a billion dollars into anything as a for-profit company, guess what’s going to happen? They’re going to pass that on to the consumer.”
Rich Lord: rlord@post-gazette.com or 412-263-1542.
First Published: February 23, 2018, 12:56 a.m.
