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Is Aqua’s $12 Million Payment Offer to Chester Legal?

Proposed Budget relied on payment from Aqua to Chester.

The state appointed Receiver for Chester’s December 2, 2020 Status Report revealed that City officials proposed a budget that relied on a $12 million payment from Aqua to the City of Chester for the sale of the Chester Water Authority assets, even though no such sale has happened, or even been voted on by the City. The Status Report also revealed that this $12 million payment from Aqua would be non-refundable to Aqua unless the City sold the CWA to another entity). Click to see Status Report

This $12 million payment is being offered at the same time that Aqua has asked the City to vote to sell the Chester Water Authority, and at the same time that Aqua has pending litigation against the City to try to block any deal the City might reach with the CWA that would not involve a sale to Aqua. The Receiver has not accepted this $12 million payment as part of the 2021 budget, which has created tension between the Receiver and Chester’s Mayor. This disagreement over the proposed $12 million payment by Aqua (whose parent company is Essential Utilities) was addressed by Chester’s Mayor at the end of the December 23, 2020 City Council meeting. In a video from the meeting posted to Chester’s Facebook page, the Chester Mayor reveals that the $12 million payment “is on the table”, “if we work with certain individuals, Essential,” and if the Receiver allowed that the City would use that payment to save jobs recently cut by the Receiver. See Video of 12/23/2020 Council Meeting (starting at approximately 1:14)

This back and forth between the Receiver and the Mayor, and the Mayor’s comments about the payment being conditioned on working with Essential (Aqua’s parent company) raises serious questions:

  • Is it legal for Aqua to propose this payment?
  • Given the RFP process and litigation between the City and Aqua, doesn’t this payment look like the City is favoring one party to the RFP process over others?
  • Doesn’t Aqua’s offer of money appear to be in exchange for Chester voting to sell the CWA to Aqua?
  • Was this payment discussed at the secret meeting Aqua had with officials prior to opening the RFP process regarding the CWA?

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