Council to Nutter: Not So Quick on PGW Sale

Its approval is needed to finalize the $1.86 billion deal.

Just because Mayor Nutter has made the deal doesn’t mean the City Council will ratify his $1.86 billion sale of Philadelphia Gas Works to a Connecticut company.

The Daily News reports:

Depending on whom you ask, a supermajority of Council members is already dead set against the sale, or else there is only one true opponent – Councilwoman Marian Tasco – and the rest are paying her lip service.

Council President Darrell Clarke, known for keeping his cards close to the vest, is doing just that. But he’s also making it clear that he won’t lose any sleep if the deal falls through.


"I don't necessarily think it needs to be privatized, but if somehow this particular agreement didn't conclude, it's not like nobody else is interested in the potential purchase of the facility," said Clarke, who wants to explore the potential for public-private partnerships or other arrangements that would expand PGW without selling it.

The Inquirer adds:

The winning bidder, Connecticut-based UIL Holdings Corp., has the option to back out of the $1.86 billion deal if Council takes no action by July 15.

Clarke sounded skeptical about unloading such a "valuable asset," saying he would like to see PGW do what a private company would do - diversify and take advantage of the natural gas boom in the Marcellus Shale.

"If I have an opportunity to do more with that asset, that would be my first option," he said.

There is other opposition, as well:

Local environmental groups are organizing against the proposal, which they say will promote more natural gas drilling and hydraulic fracturing in Pennsylvania.

“Public policy decisions, such as not buying dirty fracked gas or not expanding polluting facilities, such as the liquefied natural gas plant will no longer be driven by the elected City Council who are accountable to Philadelphians,” said Tracey Carluccio with the Delaware Riverkeeper Network in a statement, “But [will] be in the hands of an out of reach company serving their bottom line.”

In the Philadelphia Business Journal, the mayor makes his case:

“There was a time when city ownership of a gas company made sense,” said Mayor Michael Nutter at a Monday press conference at City Hall. “I believe that time has now long-passed.”

Since Nutter first began examining the possible sale of PGW in 2010, he made it clear that there were certain criteria that had to be met. The agreement will keep utility rates the same, and no jobs will be lost, for at least three years. If UIL decides to increase rates, it will have to go through the same process PGW would go through today to do so, Nutter confirmed.

 

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  • critical mass

    When did we become infatuated with privatization? Thus far it is destroying our environment, our education system, and our health care system. Now we’re going to destroy our public utilities. Nutter is a disaster.

  • RightsTough

    Dear City Council: This PGW Sale will serve ONE PURPOSE: Paying for the City Pensions for a period of X number of years. However, once these Private Equity guys gain control of this MONOPOLY Utility, they will raise the rates and cover their investment through higher rates. These higher rates will go on for perpetuity. All of your kids and grand kids will be subjected to this corporate surcharge FOREVER!

    To be clear: NOTHING GODD will come out of this PGW Sale unless you are a partner at the Equity Firm or unless you are one of the people who will have their unsustainable pensions covered for a period of time.

    What’s next? Sell the highways to cover pensions? Sell the State stores to cover the pensions? Sell City Hall to cover the pensions? Call me crazy but perhaps the PENSIONS are the problem!!

  • matthew brandley

    The inky and the mayor stated it well. Its all biz! advantage of the exporting and stroage of natural gas tanks along the river and the potential to export over seas to europe. MD just aproved export terminal at calvert cliffs today for natural gas so the phila area could be the 2nd largest petro refiner in the country in the next 2 years folks. more $ more high paying jobs