Nutter, Clarke Spar Over Death of PGW Privatization Deal

Photo | Jeff Fusco

Despite some glimmers of last-minute hope a few weeks ago and Doug Oliver’s endorsement of a sale earlier this week, Mayor Michael Nutter’s proposed deal to sell Philadelphia Gas Works to a Connecticut company for $1.86 billion — already comatose after City Council President Darrell Clarke announced in late October that Council would not touch the matter — has ended not with a bang, but a withdrawal.

In a statement yesterday afternoon announcing the termination of its offer, UIL Holdings placed the blame squarely on City Council:

“Unfortunately, we had no choice but to terminate our efforts in the City of Philadelphia to acquire the PGW assets,” said James P. Torgerson, UIL’s President and Chief Executive Officer. “We are extremely disappointed that no ordinance was introduced to approve the acquisition and we’re equally disappointed that we were not afforded a hearing to present the facts regarding our bid proposal. Philadelphia and the City’s gas customers would have benefitted from our accelerating the pace of pipe replacement and from our management of the PGW assets.”

Nutter didn’t hide his frustration in his own statement:

“This decision by the Philadelphia City Council is a big mistake and represents a massive failure in leadership for our City and our citizens. It is unfortunate for Philadelphia that City Council could not make a public decision in this important matter following public hearings and an up or down vote. Instead, City Council held no hearings and chose a behind-the-scenes decision making process and no action, thus shutting out the public and denying Philadelphians the opportunity to voice their views.

“The citizens of our City, the customers of PGW and our own City workers will feel the negative effects of this terrible indecision for years to come, and ultimately will regret that City Council chose to end a legitimate debate on this issue even before it started.”

But Clarke slapped it right back:

“It is unfortunate that Mayor Nutter chose to pursue an extremely narrow deal to privatize PGW that ignores opportunities to increase Philadelphia’s economic output. This deal would have resulted in significant job loss among Philadelphians by allowing UIL to lay off employees and to shift jobs away from experienced PGW workers, who are bound by residency requirements to live in our City, to less experienced workers from anywhere outside of Philly.

“Make no mistake, the failure of this deal is not the fault of UIL Holdings. The lack of sufficient jobs, consumer and safety protections in this deal are a direct result of the Nutter Administration’s Request for Proposals, which was limited in scope and issued with no input from City Council. Such a shortsighted deal that did not address the concerns of the approving authority, in this case City Council, never had a chance of winning our endorsement.”

For thoughts on what the death of the deal means for Philly’s future as an energy hub, see Patrick Kerkstra’s spot-on analysis from late October.

Previously: Mayor: Council Is Fibbing! Council: Nuh-Uh!