By Carol Britton Meyer, March 21st 2019
The Advisory Committee (AC) supported a warrant article last night (March 20), voting 11-2, that if approved by a two-thirds vote at the April 22 Town Meeting would allow the town to purchase the Aquarion water system that serves Hingham, Hull, and part of Cohasset.
The majority vote was the same for the other three related articles (voting 11-2), with only AC members Eric Haskell and Libby Claypoole voting “no” on all four articles.
The other articles relate to:
*appointing the Hingham Selectmen as water commissioners, at least for the first year;
* establishing a (self-supporting) water system enterprise fund;
* appropriating money to cover transition costs if the proposed acquisition wins voter support.
Majority view
In response to an email from the Hingham Anchor following the meeting, AC Chairman Donna Smallwood summed up comments made by Advisory Committee members who voted in favor of the four articles. “Members voting in the majority spoke to financial benefits to the ratepayers in both the short and long term — with lower and slower water rate increases — along with savings available for additional needed capital improvements. They cited the importance of local control of this system delivering our water, a critical and scarce resource,” she said. “Members in favor of the articles observed that town ownership would result in more transparent governance, including rate setting, and believed that the town would prove a better steward of the aquifer. They also expressed confidence in the town’s ability to successfully operate the water system, pointing not only to the 96 percent of all Massachusetts water connections owned and operated by municipalities but also to the town’s success in operating the Light Plant. They saw acquisition of the Water Company as an opportunity to benefit generations to come.”
Minority view
Smallwood also summed up the views of the members who cast the minority votes. “Members voting in the minority spoke to the need for further investigation of options for governance and operation, along with more developed agreements with Hull and Cohasset. They observed that the current proposal is not sufficiently detailed and suggested that the town take more time to refine it. They expressed concern that the town will not be able to run the water system efficiently with the proposed third-party contractor and therefore that the suggested savings may prove unrealistic [mentioned by Claypoole].” That’s because the impact on overall savings would depend on the degree to which binding quotes exceed the non-binding estimates used in the town’s financial model, according to Claypoole.
Haskell also made a PowerPoint presentation to the AC in which he concluded (and Claypoole agrees) that putting the purchase question on the ballot for this year’s town election was feasible and would help encourage voter participation in the purchase decision. In his PowerPoint presentation Haskell called such a purchase “the largest single transaction in the history of the Town of Hingham. “Submitting the water utility purchase to the voters for confirmation on the [town election] ballot is not required but is a choice Town Meeting can make and might be the right thing to do,” Haskell said. “. . .The fact that a [town election] ballot vote is not required does not mean that it is not permitted.” This would mean that approval of the purchase would be contingent upon a majority ballot vote at the April 27 town election, not a two-thirds vote as required at Town Meeting.
Haskell also stated, however, that the town’s attorney had given him an opinion that such a (town election ballot vote) could not be done. Although Haskell, an attorney himself, expressed skepticism about that conclusion, Haskell explained that he did not feel that he could ask the AC to override the advice of town counsel.
Looking back
The vote on the four articles by the full Advisory Committee followed an earlier Advisory Committee Water Company Subcommittee vote that supported the acquisition article 4 to 1 and the other three related articles unanimously.
Earlier the Selectmen made the decision to advance the acquisition proposal to a Town Meeting vote following the Water Company Acquisition Study Committee’s recommendation that purchasing the system would be a wise move, resulting in an expected cost savings of nearly $50 million over the 30 years the debt would be repaid if Town Meeting approves the approximately $110 million purchase (purchase price only). With completion of the payments — in 2049 — total savings are projected to increase to $7.4 million per year.
The Advisory Committee recommendations on all four articles will appear in the Town Meeting warrant and will include full details about each so that citizens can make an educated decision at Town Meeting on April 22.
A group called Citizens for Hingham Water supports the purchase due to the expected cost savings over 30 years and beyond and what they consider to be the benefits of local ownership and control.
In contrast, another group — Keep Aquarion — is opposing any such acquisition in large part due to the purchase price and related costs and in consideration of the large number of expensive capital projects under consideration.
However, supporters of the proposed acquisition confirm that such a purchase wouldn’t negatively impact the town’s AAA bond rating or ability to borrow for other capital projects and that the bond payments would be met through the water rates and would not increase taxes.
Check the Hingham town website at hingham-ma.gov to access water company acquisition-related documents and financial models.