Thursday, Town Council chose to move forward with the evaluation of selling water and wastewater services to Virginia American Water.
From there proposal:
Virginia American is the largest investor-owned water and wastewater utility in the Commonwealth of Virginia. We provide service to approximately 350,000 people within seven counties and two cities. Virginia American and its predecessors have provided drinking water service to the City of Alexandria since 1850; Dale City since 1966 (Prince William County); areas in and around the Northern Neck (18 well systems – treatment and distribution) since 2000; and wastewater services to Dale City (Prince William County) since 2013. Virginia American has also provided drinking water service to Fort Lee since 2001 under a contract with the U.S. Army; and water treatment and distribution to the City of Hopewell and portions of Prince George County since 1924.Virginia American is a leader in providing communities with both safe and reliable water and wastewater service.
The (Company employs approximately 135 professionals with experience in all areas of water and wastewater operations. Virginia American has the expertise, record of environmental compliance, commitment to invest in necessary capital improvements and experienced management and operations team necessary to provide safe and reliable water and wastewater services to the Town’s customers. Virginia American regularly invests in infrastructure. Approximately $25 to $40 million is invested annually across the state. Since 2017, the company has invested nearly $98 million in water and wastewater infrastructure upgrades, including the replacement of aging water mains in our Alexandria, Eastern, Hopewell and Prince William Districts.
The next step is if you, the public to weigh in on the proposal.
A Town Hall event is scheduled for January 27th @6:30 at the Civic Center, 500 Tazewell Ave.
The full Virginia American Water proposal is available on the town website.
Is this the same American Water Company whose stock sells for $163.57 per share in the most recent listing?
American Water Reports Third Quarter 2021 Results and Affirms 2021 Guidance Range
11/02/2021
Announces 2022 Guidance, Long-term Growth Targets, and Capital Investment Plans
Third quarter 2021 diluted earnings of $1.53 per share, compared to $1.46 per share in 2020; Year-to-date 2021 diluted earnings of $3.40 per share, compared to $3.11 per share in 2020
Quarter and year-to-date results reflect an estimated unfavorable impact of $0.07 per share and $0.04 per share, respectively, from cooler and wetter weather in 2021 compared to 2020; on a weather normalized basis, results increased 10% and 11% for the quarter and year-to-date periods, respectively
2021 diluted earnings per share (EPS) guidance range of $4.18 to $4.28 per share affirmed.
This guidance range excludes any estimated impact from a closing of the announced sale of Homeowner Services business (HOS) in 2021
2022 diluted EPS guidance range of $4.39 to $4.49 established, reflective of continued growth of the Regulated Businesses and announced sale of HOS
Long Term EPS compound annual growth rate (CAGR) established at a narrowed range of 7 to 9% for the 2022-2026 period
Increased regulated investment over the next 10 years by $6.0 billion to a range of $28-32 billion, reflective of redeployment of Homeowner Services sale proceeds
CAMDEN, N.J.–(BUSINESS WIRE)– American Water Works Company, Inc. (NYSE: AWK) today reported results for the quarter ended September 30, 2021, of $1.53 per share, compared to $1.46 per share in 2020.
The Company today also established 2022 diluted earnings per share guidance, and announced its long-term EPS growth target, and capital investment plans.
“We continue to deliver solid results with third quarter 2021 earnings in line with our expectations.”
“These results demonstrate that we continue to grow our business through the consistent execution of our strategies,” said Walter Lynch, president and CEO of American Water.
“Building on our year-over-year success, we have further strengthened our regulated business and will now deliver even higher quality earnings,” added Lynch.
“With our recently announced sale of our Homeowner Services business, we can accelerate on our commitment to build and maintain reliable and resilient water and wastewater infrastructure, continue to put our customers first, and deliver water and wastewater solutions where we create the most value for customers and communities.”
“Additionally, 100% of our earnings going forward will come from our regulated and regulated-like businesses, providing long term, stable and steady growth.”
Cape Charles is about to become a corporate cash cow!
I attended the Town Council meeting last Thursday; all of the public comments offered at the meeting included specific concerns about the merits of the sale of the utility assets and several speakers, including myself, asked for specific information and clarifications of published information. The council did not respond to any of the speakers’ comments; I am waiting to see the meeting minutes to understand if all of the written statements are entered into the public record.
Finally, the town manager indicated that an important consequence of the council deciding to move forward with discussions with American Water means that, under the PPEA rules, the town will release additional information, including financial information, to the public.
American Water’s proposal posted to the Town’s website promises to audit the assets and the operations after acquisition and create a funding plan for capital and operational upgrades. Their proposal also indicates that the cost for water and sewer has not increased since 2012 and that they will administer rates based on American Water’s strategy. Cape Charles residents already pay the highest rates for water and sewer in Northampton County – the minimum is nearly $100/month per residence. Does the town council are about the impact of increased costs for property owners (and increased rental rates and prices at the businesses in town)?
I’m still waiting for the town council to answer these two questions:
1. The town is halfway through the 10-year term of a NO INTEREST LOAN for the new water and sewer plant. There is no cheaper way to use other people’s money than a 0% interest loan. What is the town going to do with the proceeds of the sale? Please don’t tell me that they are going to rearrange the budget line items and build a new town hall and claim that it’s not due to the proceeds of the sale. The value of a new town hall accrues primarily to the town employees, the town council and the town business. There’s very little value to residents, business owners, property owners, tourists and other stakeholders.
2. Why hasn’t the town evaluated the option to keep ownership of the assets – at least for 10 more years – at the end of the 0% interest loan – and outsource the operation and maintenance of the water and wastewater systems? This plant is only 10 years old – it has a 50 year life – and the amount of capital improvements should not be high – American Water’s proposal documents that the water distribution and wastewater/storm water collection systems have been upgraded within the last 15 years. Outsourcing the operation and maintenance for 10 years would allow a clearer understanding of the limitations of the existing assets and infrastructure – and the cost/benefit of capital improvements.
Don’t Sell