Hingham Journal Letter
Letter to the Editor of the Hingham Journal, by Katharine Reardon
Buy the Hingham Water Company: Increase local control of this precious resource
February 25, 2019
I’ve lived in Hingham for 40 years, and have been involved with Hingham Town affairs for much of that time. Hingham is a wonderful place to live right now, and I want the Town to continue to be a good place to live and raise a family for generations to come.
That is why at the upcoming Town Meeting, I’m voting for the Town of Hingham to acquire the water company. Our water supply is too critical a resource to trust to an ever shifting string of for-profit companies. They do not share our priorities, nor as they as invested in the Town’s future as we are.
Our water company has been acquired three times in the last seventeen years (in 2002, 2007, and by Eversource in 2017, for ever increasing prices). These acquisitions show that water utilities do provide a dependable and profitable revenue stream. No wonder Aquarion wants so desperately to hang onto it.
In Massachusetts, outside of “Service Area A”, composed of Hingham, Hull and part of Cohasset, Aquarion provides water to only two towns, Millbury and Oxford. The Town of Hingham is trying to acquire the part of Aquarion that provides water to Service Area A, which is about 72% of Aquarion’s Massachusetts business.
In Massachusetts, public water companies are the norm, not the exception. Only a very small percent of the state’s population is served by non-public water systems. The vast majority of the population is served by publicly owned water systems or providers like the Massachusetts Water Resources Authority (MWRA). Having a private water company like Aquarion makes Hingham an outlier.
Aquarion’s track record demonstrates its focus on financial performance. The level of unaccounted for water or leakage is much higher than the state norm of 10%. They fix water mains mostly on a “break / fix” basis. After their own studies highlighted Downer Avenue’s water main as needing replacement in 2007, 2011 and 2014, the situation reached a crisis just a few weeks ago when the main broke and nearly forced the closing of Foster School. Hingham can do better than this.
Here in the Town of Hingham, we have a long history of two important things: strong management and self-sufficiency.
Hingham is one of a few Massachusetts towns recognized with a AAA bond ratingby all three rating agencies (Fitch, Moody's and Standard & Poor's). The AAA rating is the highest credit rating an organization or municipality can receive.
The Hingham Municipal Light Plant has been a publicly owned municipal utility since 1894. And everyone in town I talk to praises their service – almost never losing power, and having it promptly restored on those few occasions when it does go out, even when our neighboring towns are out for days. The Town of Hingham will bring the same focus on execution, customer service and good management to the water company. That is the standard for Hingham in all areas.
Can we afford this purchase? The purchase price is $110 million (not the undefined $250 million Aquarion has been promoting in its campaign to confuse the issue). This is like acquiring a profitable apartment building with all of its units fully rented. The cash flow from water ratepayers will be more than sufficient to pay off the acquisition costs, especially once we no longer will have 55% of every revenue dollar paid to Aquarion leaving Service Area A entirely.
Most importantly, acquiring the water company will NOT increase our taxes, and the acquisition doesn’t compete with other capital projects the Town is considering, such as improving or replacing Foster School. As for the impact on water rates, they’re likely to increase more quickly under Aquarion than under Town ownership. And at the end of the debt period, Hingham will fully own this asset.
Obviously Aquarion/Eversource wants to keep its profitable water business. But I believe that the future interests of Hingham will be better protected with the Town of Hingham being the steward for this vital resource. The Town has done its due diligence over the past seven years, and we’re ready to bring the same AAA-rated management style to running the water company.
So mark your calendars to show up at the High School for our Annual Town Meeting on Tuesday, April 22nd, and vote Yes for the Town of Hingham to buy the water company.