Harrisburg is considering privatizing its water and sewer system, asking qualified companies to submit letters of interest to the city.
The “request for information” is designed to gauge market interest and ascertain preliminary qualifications, a first step in potentially selling the system, said Mayor Eric Papenfuse.
“I’m not saying we’re going to do it,” Papenfuse said. “But if it seems beneficial, then we’ll take it to the next step.”
Letters of interest are due to the city by the end-of-day, Sept. 16, potentially followed by interviews and a formal bidding process.
Capital Region Water (CRW) currently operates the city’s water/sewer system, overseen by a five-member volunteer board appointed by the city. The municipal utility was established in 2013 following the dissolution of the former operator, the Harrisburg Authority. If the city sells the system, CRW would be dissolved.
Papenfuse said that the decision to explore privatization was prompted by the city’s dissatisfaction with CRW. He strongly objects to CRW’s proposal to implement a stormwater fee, which would initiate a new fee for most customers starting on Jan. 1. Under the proposal, customers would pay a fee of $72 a year or $6.15 per month, money designed to fund improvements to the city’s aging stormwater system and reduce the flow of toxins into streams and the Susquehanna River.
Papenfuse said that he also considers the Front Street interceptor project, which was delayed several times last year, to be a “complete boondoggle,” and charged that CRW lacks a firm plan to bring the city into compliance with a federal partial consent decree to reduce pollution into area waterways.
“I have concerns about Capital Region Water’s ability to manage the projects they do have planned,” Papenfuse said. “I want to explore if a private company can do a better job.”
Marc Kurowski, chairman of the CRW board, said that he was surprised by the city’s exploration of a sale, which he learned about on Thursday afternoon, just hours before Harrisburg publicly posted the request for information notice on its website. CRW officials and the board now need to discuss the matter and decide what to do next, he said.
“We were not part of the conversation or discussion that prompted this to happen,” he said. “We need to do some homework and figure out what it means and figure out what the next course of action is.”
If the system is sold, the buyer would get access to about 20,300 water customers, primarily in the city limits, and a 17,000-connection wastewater system that serves Harrisburg and several surrounding municipalities.
A buyer also would receive all assets currently owned and operated by CRW, including the stormwater infrastructure, a wastewater treatment facility, five pumping stations and the 6-billion-gallon capacity DeHart Reservoir.
“This is not a bid situation yet,” Papenfuse said. “We are only asking companies if they have an interest and the expertise.”
Click here to read the city’s “Request for Letter of Interest.”